The Hills Shire Council v Stankovic

1. [1]

   The Hills Shire Council seeks orders under s 8 of the Vexatious Proceedings Act 2008 (NSW), prohibiting Mr Milovan (also known as Michael) Stankovic from instituting proceedings in New South Wales, without leave of this Court. Orders staying proceedings he currently has on foot in the New South Wales Land and Environment Court, to which the Council is a party, are also sought.

2. [2]

   In 2005, the Council brought proceedings against Mr Stankovic in the Land and Environment Court, seeking various orders under s 76B of the Environmental Planning and Assessment Act 1979 (NSW), as to the use and condition of property in Kellyville which Mr Stankovic then owned, and where he was living. The Council claimed that he was keeping up to 100 pigs there and using the property as a junk yard.

3. [3]

   In February 2005, Lloyd J dismissed the proceedings for want of prosecution, in the Council’s absence. The Council later applied to have the proceedings reinstated. On 14 March 2005, Pain J gave judgment in favour of the Council and made orders against Mr Stankovic, including as to costs: Baulkham Hills Shire Council v Stankovic & Anor [2005] NSWLEC 110.

4. [4]

   That was the start of a long course of litigation. Mr Stankovic was finally refused leave to appeal Pain J’s judgment: Stankovic v The Hills Shire Council [2015] NSWCA 279.

5. [5]

   In 2015, Mr Stankovic also commenced further proceedings in the Land and Environment Court, seeking to have Pain J’s 2005 orders set aside, amongst other orders. In August 2015, Pepper J stayed those proceedings, pending determination of these proceedings.

6. [6]

   The Council’s standing to bring these proceedings arises from s 8(4)(d) of the Vexatious Proceedings Act, it having been a party to many of the proceedings on which it relies to establish its case against Mr Stankovic. It also relies on proceedings in the Family Court, as well as proceedings which Mr Stankovic has brought against former legal representatives and his trustees in bankruptcy, in which he has variously advanced claims that the orders made against him in 2005 by Pain J were not valid; that the sequestration order later made against him in the Federal Circuit Court was also not valid; and that he has suffered damages exceeding $35 million, as the result of the sale of the Kellyville property.

7. [7]

   At the hearing, in accordance with Viavattene v Attorney General (NSW) [2015] NSWCA 44, the Council refined the general order sought as:

8. [8]

   Mr Stankovic opposed the Court exercising its discretion to make any orders against him.

Legal representation

1. [9]

   In almost all of the proceedings the Council relied on, Mr Stankovic has appeared unrepresented. One exception was in Stankovic v The Hills Shire Council [2012] NSWSC 738, which Adamson J dismissed. Then he was represented by Dr Walsh, who appeared for him again on this application. Another was on an application in Stankovic v The Hills Shire Council [2015] NSWCA 279 at [13], when leave to appeal from the judgment given by Pain J in the Land and Environment Court on 14 March 2005 was refused. Mr Stankovic was also represented in some applications made in respect of his bankruptcy.

2. [10]

   This is relevant because firstly, there was in this case no objection to the tender of the judgments on which the Council relied to make out its case. Secondly, because in this case there was no issue lying between the parties as to the proper construction of the Vexatious Proceedings Act. Thirdly, because a conclusion that particular proceedings are vexatious is more difficult to reach where a party was legally represented, as was conceded by the Attorney General in The Attorney General for the State of New South Wales v Mohareb [2016] NSWSC 1823 at [65].

The parties’ cases

1. [11]

   The Council’s case rested on some 41 judgments published since 2005 by the Land and Environment Court, the Federal Magistrates Court, the Federal Court, the District Court, the Court of Appeal and this Court, in proceedings to which Mr Stankovic was a party. Of those, 23 were particularly relied on.

2. [12]

   Prior to the hearing and outside of the time directed, Mr Stankovic had prepared an extensive affidavit, while he was still unrepresented. There he deposed to his views as to what had transpired in various of the proceedings on which the Council relied; the errors he believes that were made in the proceedings in the Land and Environment Court, Federal Magistrates Court and Court of Appeal; and why the orders sought by the Council should not be made. Much of this affidavit was objected to and finally not read, Mr Stankovic being legally represented at the hearing.

3. [13]

   It was not finally contended for Mr Stankovic that the evidence was not capable of establishing that he had instituted and conducted “vexatious proceedings” as defined in s 6 of the Vexatious Proceedings Act, or that he had done so frequently. It was thus acknowledged that he faced difficulties resisting the orders sought, given the decisions relied on, but it was urged that the Court should accept that his case was not hopeless.

4. [14]

   The case pressed for Mr Stankovic as to the Court’s exercise of its discretion included that:

   1. (1)

      The Court should not to take into account judgments given in the Family Court proceedings commenced by his wife;

   2. (2)

      The Court should “minimise” its consideration of proceedings he had commenced against his lawyers, which had arisen out of disputes over legal costs;

   3. (3)

      The Court should take into account Mr Stankovic’s lack of legal representation in most of the proceedings to which he was a party;

   4. (4)

      Mr Stankovic did not want to be a permanent litigant, but wanted to resolve “this one issue”, although it was not entirely clear what that issue was;

   5. (5)

      Referring to Attorney-General v Wentworth (1988) 14 NSWLR 481, it was contended that Mr Stankovic had not sought to harass, annoy or embarrass anyone and that he had not made applications for purposes other than having a court adjudicate upon the issues to which they gave rise and that he had only ever sought to “get a just result in relation to his financial position”;

   6. (6)

      If the Court was minded to make an order under the Act, it should not “close the door completely” on the pursuit of the issues he has pursued to this point;

   7. (7)

      Accordingly, any order made should still leave it open for Mr Stankovic to institute proceedings against the Council, or any other party, on any ground that had not already been ruled upon by the Court of Appeal. He should also be permitted to bring further proceedings in relation to matters he had already litigated, if he obtained new evidence, such as evidence proving fraud.

Issues

1. [15]

   It was thus common ground that whether the orders pressed would be made depended on:

   1. (1)

      The Court being satisfied that:

   2. (2)

      The Court being satisfied that it should exercise its discretion to make vexatious proceedings orders against Mr Stankovic.

2. [16]

   For reasons which follow I am satisfied that these issues must be resolved in the Council’s favour, it having established as it has that Mr Stankovic’s ongoing pursuit of his views as to the judgment given by Pain J in 2005, his later bankruptcy and the sale of his Kellyville property, in both proceedings he has brought and interlocutory applications he has made in other proceedings, has involved the institution and conduct of “vexatious proceedings” as defined; that he has done so frequently; and that the circumstances are such that the Court’s discretion must be exercised, albeit not in the form of the orders pressed.

Mr Stankovic has instituted or conducted “vexatious proceedings”

1. [17]

   The Council particularly relied on judgments in:

   1. (1)

      Proceedings brought in relation to sequestration and other orders made against Mr Stankovic by Raphael FM on 12 May 2009. Those orders were dealt with by:

   2. (2)

      Proceedings brought in the Land and Environment Court, this Court and the Court of Appeal in relation to the Kellyville property; its sale to Eric Newham Namul Pty Ltd by Mr Stankovic’s trustees in bankruptcy; and damages arising from his loss of the property, which were dealt with by:

   3. (3)

      Proceedings brought in the District Court and this Court relating to damages sought by Mr Stankovic against his former solicitors, which were dealt with by:

2. [18]

   In addition to these judgments, the Council also submitted that when exercising its discretion to make the orders sought, the Court should take into account three Family Court judgments to which Mr Stankovic was a party, because he had pursued his case in those proceedings on the same grounds as the proceedings that they argued were vexatious.

3. [19]

   There was no issue between the parties that Mr Sankovic was a party to the Family Court proceedings, but whether the judgments were relevant to the exercise of the Court’s discretion was not agreed.

4. [20]

   I consider that the Family Court judgments are relevant, evidencing as they do that in those proceedings Mr Stankovic has also pursued a course by which he calls into question decisions, including that of the Court of Appeal and Full Federal Court, by which he is bound. That this was so, was, in truth, not disputed by Mr Stankovic.

5. [21]

   The evidence well established that Mr Stankovic commenced “vexatious proceedings” as defined in s 6 of the Vexatious Proceedings Act to mean:

6. [22]

   The word “proceedings” is defined in s 4 to mean:

7. [23]

   It was Pain J in Stankovic v The Hills Shire Council (No 2) [2007] NSWLEC 870 at [16] - [20] who first discussed the principle of finality in litigation in proceedings brought by Mr Stankovic. In the appeal from her Honour’s judgment, the Court of Appeal set out a summary of the proceedings and its procedural history and affirmed the validity of the Land and Environment Court’s reinstatement of the 2005 proceedings: see Stankovic v The Hills Shire Council [2015] NSWCA 279 at [4] - [16].

8. [24]

   Mr Stankovic did not appeal that judgment, but has plainly never accepted the conclusions reached, as recent judgments of the Court of Appeal confirm. Nor has he accepted conclusions reached in other judgments in relation to the claims which he has variously advanced, as to the invalidity of his bankruptcy and its consequences. The views which Mr Stankovic has long held are views which he continues to advance, even in the affidavit which he swore in these proceedings. They, too, plainly call into question judgments which bind him, including those given by the Court of Appeal and the Full Federal Court.

9. [25]

   In the result, it also cannot be doubted that Mr Stankovic has “instituted” a considerable number of vexatious proceedings, that term being defined in s 5(1) to include:

10. [26]

    Section 5(2) provides that a reference to instituting proceedings includes instituting:

11. [27]

    The evidence also establishes that Mr Stankovic has commenced vexatious proceedings “frequently”, as that word is used in s 8(1)(a). That is a relative concept, the meaning of which turns on its context. Whether such proceedings have been commenced “frequently” thus depends upon "the quality of the vexatiousness of a proceeding and the nature of the proceeding itself, inform the assessment of frequency": Potier v Attorney General in and for the State of New South Wales (2015) 89 NSWLR 284; [2015] NSWCA 129 at [114] - [118]. The considerations there discussed favour “‘frequently’ being a relatively low threshold”.

12. [28]

    As I will explain, the judgments the Council relied on establish that this threshold has been met in Mr Stankovic’s case. On the evidence there can be no question that despite his legal representation at the hearing of some of the proceedings in question, he has frequently instituted or conducted vexatious proceedings in Australia.

13. [29]

    It follows that the Court’s discretion to make orders under s 8 of the Act against him arises to be exercised.

14. [30]

    The reasons for those conclusions are as follows.

15. [31]

    In the proceedings relied on, Mr Stankovic has repeatedly contended that Lloyd J’s dismissal of the Land and Environment Court proceedings on 16 February 2005 was final and that any proceedings pursued after that dismissal, were invalid, void or of no effect.

16. [32]

    That argument was plainly wrong, given the powers exercised by the Court. It was rejected by the Court of Appeal in Stankovic v The Hills Shire Council and Namul Pty Ltd [2015] NSWCA 279, which found on the material before it, that there was no hint of any irregularity in the proceedings in the Land and Environment Court being reinstated and that Mr Stankovic’s challenge to the validity of the proceedings before Pain J was misconceived.

17. [33]

    Neither that judgment, or any other given by the Court of Appeal or the Full Federal Court have been sought to be challenged in the High Court, although I note that an application for an extension of time by Mr Stankovic to seek special leave to appeal Stankovic v Van Der Velde [2013] FCAFC 57 was refused in Stankovic v Terry Grant Van Der Velde & Ors [2014] HCASL 109.

18. [34]

    It follows that Mr Stankovic’s ongoing pursuit of the arguments which failed before Pain J and the Court of Appeal, in other proceedings, was “vexatious” as defined in s 6 (a) and (c) at least.

19. [35]

    In the bankruptcy proceedings, Emmett J discussed the problems with Mr Stankovic’s case, so advanced: Stankovic v Van Der Velde (No 3) at [16]. That judgment was not appealed, but the argument that the Land and Environment Court proceedings had been dismissed was also raised unsuccessfully again before Adamson J in this Court: Stankovic v The Hills Shire Council [2012] NSWSC 738. There was also no appeal from her Honour’s judgment.

20. [36]

    That argument was also advanced, however, before Yates J in Stankovic v The Hills Shire Council [2013] FCA 765, when leave to appeal Foster J’s dismissal of his application to annul his bankruptcy was also dismissed. Then other allegations already determined against him were also advanced, for example that his former legal representatives were not entitled to fees, earlier dealt with in Kent and Orlizki in the matter of the Bankrupt Estate of Stankovic [2012] FCA 333 at [20].

21. [37]

    Mr Stankovic, again, raised the belief he continues to hold about the dismissal of the proceedings in 2005, in the proceedings he currently has on foot in the Land and Environment Court, despite their rejection again in other judgments given in 2016 by the Court of Appeal. That is consistent with views he has expressed in the parts of the affidavit relied on in these proceedings, where his views and complaints about the reinstatement of the Council’s 2005 application in the Land and Environment Court, which have been repeatedly rejected, as I have explained, were raised again.

22. [38]

    Mr Stankovic’s pursuit of these claims resulted in proceedings which were vexatious, as defined.

23. [39]

    The Council pursued bankruptcy proceedings against Mr Stankovic in the Federal Magistrates Court in 2009. Sequestration orders were made by Raphael FM in The Hills Shire Council v Stankovic [2009] FMCA 478. Mr Stankovic’s trustees in bankruptcy sold the Kellyville property in September 2010. His challenge to that bankruptcy advanced on various grounds, including on the basis that he had paid the judgment debt to the Council, was not insolvent and the victim of fraud, failed: Stankovic v Van Der Velde [2013] FCAFC 57 at [12]-[13].

24. [40]

    Still Mr Stankovic has repeatedly and unsuccessfully called into question the validity of the bankruptcy, including in proceedings Namul Pty Ltd brought in this Court against him for injunctive relief, to prevent him trespassing on the Kellyville property and impugning its title: Namul Pty Ltd v Stankovic [2013] NSWSC 115. Mr Stankovic’s ongoing pursuit of those arguments in that and other proceedings, has in the result, also been “vexatious” as defined in s 6.

25. [41]

    Mr Stankovic also advanced such arguments in the applications for stay of Rein J’s orders: Stankovic v Namul Pty Ltd [2013] NSWCA 41. A second application for stay was dismissed in Stankovic v Namul Pty Ltd (No 2) [2013] NSWCA 260. Similar arguments were advanced on the appeal, when it was concluded that Rein J and the Court of Appeal were required to recognise and accept the orders of the Federal Magistrates Court, the Family Court and the Land and Environment Court: Stankovic v Namul Pty Ltd 2013 NSWCA 276 at [11].

26. [42]

    Such arguments were also advanced unsuccessfully in the applications pursued in 2013 to reopen the bankruptcy: Stankovic v Baulkham Hills Shire Council [2013] FMCA 178.

27. [43]

    Mr Stankovic’s pursuit of these claims also resulted in proceedings which were vexatious as defined.

28. [44]

    Despite his bankruptcy and the sale of the property, Mr Stankovic continued to assert that he owned it, entering the property, removing chains on gates and holding barbecues there: Namul Pty Ltd v Milovan Stankovic [2013] NSWSC 115 at [6]. Earlier he had filed a caveat which his trustees in bankruptcy had taken steps to remove: Namul Pty Ltd v Milovan Stankovic [2013] NSWSC 115 at [10]. Before Rein J, Mr Stankovic’s challenge to Namul’s right to ownership of the Kellyville property failed and Namul was granted the injunctive relief it sought, to prevent his continuing slander of is title. The appeal was dismissed in Stankovic v Namul Pty Limited [2013] NSWCA 276.

29. [45]

    Despite this, in Namul Pty Ltd v Stankovic [2016] NSWLEC 15 Moore J refused Mr Stankovic’s application to be joined as a party to proceedings between the Council and Namul in the Land and Environment Court, given the orders made by Rein J. Leave to appeal was refused in Stankovic v The Hills Shire Council and Namul Pty Ltd [2017] NSWCA 49, where again, Mr Stankovic's claim to be the lawful and rightful owner of the property failed, the Court concluding that Moore J’s order was the only one open, given what had been decided by Rein J and the arguments advanced having been ones previously considered and rejected.

30. [46]

    The pursuit of these claims thus also resulted in proceedings which were vexatious as defined.

31. [47]

    Mr Stankovic has also failed in proceedings he pursued against nine separate parties, including the Council, his trustees and his former solicitors, by which he sought orders for damages of some $35 million, based on his loss of the Kellyville property.

32. [48]

    In 2012, Adamson J found that his statement of claim which claimed huge financial loss, involved an abuse of process depending as it did, amongst other things, on complaints about the sequestration order and his re-agitation of matters on which he had not succeeded in other proceedings: Stankovic v The Hills Shire Council [2012] NSWSC 738 at [8].

33. [49]

    The damages claim was also advanced before Emmett J in Stankovic v Van Der Velde (No 3) [2013] FCA 183, when Mr Stankovic sought to reopen his 2009 bankruptcy and have the Kellyville property restored to him.

34. [50]

    The argument in relation to having suffered $35 million damages was also pursued before Foster J, when orders annulling the bankruptcy were refused: Stankovic v The Hills Shire Council [2013] FCA 652.

35. [51]

    Claims for $35 million damages were also pursued against Mr Magee, who acted for him in Family Court proceedings. They were dismissed as entirely hopeless and doomed to fail in Stankovic v Peter Michael Magee t/as Armstrong Legal [2014] NSWSC 873 at [23]. The appeal from that decision was given in Stankovic v Magee trading as Armstrong Legal [2016] NSWCA 168 and the appeal against the proceedings brought against Mr Magee in the District Court was dealt with in Stankovic v Magee t/as Armstrong Legal [2016] NSWCA 125. There it was observed at [16] that:

36. [52]

    Similar damages claims against Mr Hockey, who acted for Mr Stankovic in the bankruptcy proceedings, were dismissed in Stankovic v Hockey [2016] NSWSC 31. Similar claims against the State were dismissed by Davies J in Stankovic v State of NSW [2016] NSWSC 18 at [36] as unarguable, doomed to fail and an abuse of process.

37. [53]

    In the result, the pursuit of Mr Stankovic’s claims to having suffered $35 million damages, has also resulted in vexatious proceedings as defined.

38. [54]

    It is not necessary to discuss what Mr Stankovic advanced in the Family Court in detail. It is sufficient to note that there he also argued, for example, that he had never been made bankrupt and that he had a claim to $35 million damages.

Why a vexatious proceedings order must be made

1. [55]

   It is in the face of this relentless pursuit, since 2005, of claims about the 2005 Land and Environment Court proceedings, his bankruptcy, the Kellyville property and his extravagant damages claim, which have been repeatedly rejected, that despite the case advanced for Mr Stankovic, I am satisfied that the Court’s discretion to make orders under s 8 of the Vexatious Proceedings Act against him, must be exercised.

2. [56]

   That section relevantly provides:

3. [57]

   The purpose of the Act must also be considered when making such orders.

4. [58]

   In the second reading speech that purpose was explained to be that Parliament intended for the Act to “expand the powers of the courts to control vexatious litigants” and thus to protect the “effectiveness and efficiency of the justice system”, by reducing the financial and emotional cost of litigation and preventing the “harm caused to, and costs incurred by, opposing parties and other participants in the justice system as a result of persistent litigation by vexatious litigants”: New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 26 June 2008 at 9459.

5. [59]

   Further, that the Act sought to “protect the fundamental right of citizens to approach the courts to seek justice in accordance with the law while preserving the efficiency of the justice system and shielding other participants in the justice system from unmeritorious actions”: New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 26 June 2008 at 9459.

6. [60]

   These purposes were re-iterated by the Explanatory Notes to the Vexatious Proceedings Bill 2008 (NSW), which refer to the Act seeking to prevent vexatious litigation and thus the “waste of public resources, the harassment of defendants in litigation and the incurring of unnecessary costs”.

7. [61]

   Given what I have explained as to Mr Stankovic’s relentless pursuit of what he undoubtedly believes to be his rights, notwithstanding that he has never been able to establish the correctness of his views, that orders must be made to end his vexatious pursuit of arguments which have repeatedly failed, cannot be doubted. His conduct has been such that both those who he has wrongly pursued and the justice system itself, must be protected from what both his affidavit and the submissions advanced on his behalf, make apparent would result, if orders of the kind pressed were not made.

8. [62]

   On the evidence I have discussed, there is no apparent basis on which Mr Stankovic has any further claim to advance against the Council, or anyone else, in relation to the proceedings the Council brought against him in the Land and Environment Court, his bankruptcy, the sale of the Kellyville property or any resulting claim for damages.

9. [63]

   In the result, I am satisfied that orders of the kind pressed must be made, despite the submissions advanced on his behalf, which included that he did not wish to be a permanent litigant, but just wants to resolve “the issue”.

10. [64]

    The difficulty with Mr Stankovic’s case, so advanced, is that all issues Mr Stankovic has pursued in the litigation I have discussed, have been resolved by the judgments which bind him, even though he simply will not accept that to be so.

11. [65]

    The evidence establishes that Mr Stankovic has no insight into what has become a significant abuse of the Australian legal system and substantial and unnecessary costs being incurred by those who have become the victim of his relentless pursuit of claims which have repeatedly failed. That there is any possibility that such costs can be recovered is entirely unlikely, given that he is still a bankrupt.

12. [66]

    Given that even now Mr Stankovic has further proceedings on foot in the Land and Environment Court in relation to Pain J’s orders in favour of the Council, it seems assured that without the orders I propose to make, Mr Stankovic’s pursuit of his beliefs will continue. That will not only result in further unnecessary costs being incurred by the Council and potentially others, but also the further waste of considerable judicial resources, which will be required to be directed to dealing with what are on the evidence, now futile claims.

13. [67]

    The orders I propose to make will stay the further proceedings Mr Stankovic has brought in the Land and Environment Court, but they do not precisely reflect those otherwise finally pressed.

14. [68]

    That is because I am not satisfied that the Court should preclude Mr Stankovic pursuing claims of any kind against the Council in the future. As discussed in Viavattene at [76], like all litigants Mr Stankovic is bound by established principles such as res judicata and issue estoppel. Thus the orders must preclude his pursuit of claims inconsistent with the decisions by which he is bound. The Council is not entitled, however, to protection under the Vexatious Proceedings Act against any other legitimate claims which might arise to be pursued against it in the future.

15. [69]

    Contrary to the case advanced for Mr Stankovic, I do not, however, consider that the orders should carve out any particular claims in relation to the matters with which they are concerned, given the breadth of all of the claims he has to date already unsuccessfully advanced, including as to fraud: see for example Stankovic v Baulkham Hills Shire Council [2013] FMCA 178 at [10].

16. [70]

    Such an approach would simply invite further litigation from Mr Stankovic, who clearly has a fervent belief in his right to pursue his claims in relation to these matters, notwithstanding all that legitimately stands in the way of him being granted the relief which he has so repeatedly been refused.

17. [71]

    Accordingly, for these reasons, I order under s 8(7) of the Vexatious Proceedings Act 2008 (NSW) that:

    1. (1)

       Milovan (Michael) Stankovic is prohibited from instituting any proceedings in New South Wales:

    2. (2)

       Proceedings 2016/00166961 in the New South Wales Land and Environment Court are stayed.

    3. (3)

       The usual order as to costs is that they follow the event. That would be an order that Mr Stankovic is to bear the Council’s costs as agreed or assessed. Unless the parties approach to be heard on the question of costs within 14 days, that will be the Court’s order.