Perpetual Trustee Company Limited v Madormo

This is what appears to be the final chapter in a piece of unfortunate litigation that has been before the Court over many months.

The plaintiff, Perpetual Trustee Company Limited, has the benefit of a judgment in its favour for possession of land and premises at Cecil Hills owned by the defendant, Mr Enzo Madormo (the “Property”).

The plaintiff was represented at this latest hearing by Mr G Koning, solicitor. Without opposition from Mr Koning, the Court granted leave to Mrs Madormo, the defendant’s wife, to appear for her husband.

Today, and much earlier this morning (in circumstances which I will shortly explain) Mrs Madormo made an oral application for a stay of a writ of possession of the Property which is to be executed at any time after 9.30am this morning.

For the record, it is now 9.55am and I have no information as to whether or not the writ has been executed at this time.

The application has been brought before me as Duty Judge sitting in the Equity Division.

Last night, at approximately 9.30pm, I was informed by Court staff that a person had telephoned the Security Desk wishing to make an urgent application to the Duty Judge to stay a writ of possession that was to be executed the next morning. As it was conveyed to me, the officer at the Security Desk was given the impression, either by express representation or implication, that the person telephoning was a solicitor who was able to come into Court later that evening with a notice of motion and affidavits.

My staff and I made ourselves available at 12.30am this morning to hear the application. Instead of a solicitor, the Court found that it was being addressed by Mrs Madormo. She handed up a bundle of typed and handwritten papers and emotionally addressed the Court asking for a stay of the execution of the writ.

Mrs Madormo and her husband had been on notice of the writ since on or about 15 January 2019. In answer to my inquiry, the only explanation she was able to offer for the application being made the night before the writ was to be executed was that in addition to being focussed on trying to obtain finance to pay out her husband’s debt to the plaintiff of approximately $750,000, various family misfortunes had occupied her and her husband’s attention.

On reviewing the bundle of papers which Mrs Madormo provided to me, I noticed that there was correspondence from the plaintiff’s solicitor to Mrs Madormo referring to a judgment delivered on 11 January 2019 by Wilson J sitting as Vacation Duty Judge in the Common Law Division which refused a further stay of a writ of execution.

Mrs Madormo had not drawn to my attention the prior history of the matter and, given the lateness of the hour, I was unable to gain access to the Court's file and Her Honour's judgment.

I directed that Mrs Madormo should notify the solicitors for the plaintiff that the Court would sit again at 9.00am this morning to deal with her application. That is what has happened and I have heard the application on a contested basis.

In the intervening several hours I have been able to obtain the Court's file and have had the opportunity to review not one, but two judgments of Wilson J. As they are not available on JusticeLink I will include her Honour’s judgments of 8 and 11 January 2019 as an addendum to these reasons. This judgment should be read with those judgments. I do not propose to repeat the entire history of these matters and respectfully adopt her Honour’s accounts.

What is important to note for present purposes is that on 8 January 2019 her Honour granted what became the fourth stay of execution of a writ of possession in relation to the Property. In granting a stay up to and including 12pm on 11 January 2019, her Honour was largely moved by what can properly be described, with respect, as compassionate grounds. These included accepting Mrs Madormo's submission that if the writ of execution were then to be executed, not only would she and her husband have nowhere to go, but their children would be left homeless.

In granting the short stay on 8 January 2019 her Honour said (at page 5):

As is apparent from her Honour's judgment of 11 January 2019, Mrs Madormo had been unable to make good on her assertions of being able to obtain finance to pay out the plaintiff. In those circumstances her Honour dismissed the defendant's motion for a stay. In doing so her Honour noted (at pages 2-3):

Consequent upon her Honour's decision a further notice to vacate was issued by the Sheriff on 15 January 2019. That notice informed the occupants of the Property "that they must vacate the premises prior to 9.30am on Thursday 21 February 2019 otherwise action will proceed to evict you without further warning. There are no further extensions to this time frame unless initiated by the Plaintiff.”

Mr Madormo's further application to the Court last night was made, quite literally, past the eleventh hour to prevent the writ being executed this morning.

When the matter came back before the Court this morning Mr Koning indicated his client was not prepared to grant any further indulgences and was insisting upon the exercise of its right to possession of the Property.

Mrs Madormo responded, in an understandably emotional and agitated way given the circumstances confronting her and her family, to the effect that she would be able to obtain finance if only she could have more time. I will summarise the argument that ensued.

Her principal submission was that she had an offer of finance from RAMS. The difficulty with that submission is that the evidence from RAMS is not so clear. By an email sent from RAMS to Mrs Madormo on 19 November 2018 RAMS stated:

There was a further email from RAMS to Mrs Madormo on 7 December 2018 which said:

Of significance is the statement in the later email from RAMS that removing what were referred to as "defaults listed on her credit file at this time of year, can take up to 30 days". It will be appreciated that well in excess of 30 days have passed since the email of 7 December 2018 and Mrs Madormo accepts that at least one "default" remains on her credit file. There is no evidence as to when or how that default might ultimately be removed. All the Court has are Mrs Madormo's impassioned assertions and promises that will occur.

So the fact remains that there is no evidence that Mrs Madormo has, as at today, even an offer from RAMS for finance capable of acceptance by her.

A further difficulty for the defendant is that there are still three caveats on the title. There were four but Mrs Madormo has been able to obtain a withdrawal of one of them. Nevertheless, three creditors to whom it appears the defendant is indebted in a total sum of some $48,000 have not been paid out and still have caveats over the Property. Just as there is no evidence of a current loan offer from RAMS there is also no evidence that those debts are going to be able to be paid so as to procure withdrawal of those caveats.

Mrs Madormo made an offer in the course of her address that she (which I understood to include her husband) would undertake to the Court not to make any further applications for a stay of execution of a writ of possession if four more weeks were allowed to enable her to obtain the funds that have apparently now been sought for months. The difficulty with that offer is that there is no evidence before the Court which can give the Court any confidence that the finance will be able to be found and all the necessary steps taken (including an advance of funds) within that four week period.

I did explore with Mrs Madormo whether her family could tender a reasonable sum to the plaintiff, in effect as the price of obtaining a four week stay conditional upon her husband giving the undertaking that she had proffered. Mrs Madormo responded that her family only had $3,000-$4,000 in the bank. Given the history of this matter, that sum would clearly not be sufficient to, in effect, purchase a further indulgence. Mrs Madormo then told me that she had a sister who might be able to provide some funds. However, on further testing of that proposition, Mrs Madormo said that she had no idea how much her sister would be able to provide and that, in any event, her sister would have to borrow the money. Obviously enough that is not something that could have been done today. Had Mrs Madormo been in a position to arrange an immediate substantial tender of funds to the plaintiff, the Court might have entertained a short further stay upon Mr Madorno’s undertaking not to make any further applications for stays of execution if the full amount of his debt to the plaintiff was not paid out by a nominated date in the near future.

Another matter upon which Mrs Madormo relied was a complaint that she had made on her husband’s behalf to the Australian Financial Complaints Authority (“AFCA”) about the original loan made to her husband by the plaintiff. However, as part of his response to Mrs Madormo's submissions, Mr Koning tendered a letter to Mrs Madormo dated 15 February 2019 from AFCA which made it clear that the AFCA was giving consent for the financier represented by the plaintiff to proceed with the eviction that is to take place today. That letter includes:

Mrs Madormo did tender a subsequent email which suggested that the complaint to AFCA remained on foot. That may be so, but there is nothing to suggest that AFCA has altered its position of consenting to the writ for possession being executed.

Finally, Mrs Madormo again told me that her family had been the victim of many unfortunate events which were beyond their control including, most recently, the unexpected and sudden terminal illness of Mr Madormo’s father. She also said that if the writ were executed today her family, including the children, would have nowhere to go.

It is impossible not to feel sympathy for anyone who is before the Court in the position of Mrs Madormo and her family. However, I am unable to give any weight to her last submission because, as I have set out in paragraph [15] above, Wilson J put Mrs Madormo on clear notice in January that if the stay was not extended, then she would have to make alternative arrangements for the accommodation of her family, including her children. The fact that she has chosen not to do so, even if in the genuine but misguided hope that a refinancing would be available, is more than unfortunate, but does not provide a reason to keep the plaintiff out of its rights, especially after so many stays have already been granted.

In the final result, the Court accepts Mr Koning's submission that the time has come to bring this matter to an end by permitting the writ of possession to be executed. There is no evidence that Mr Madormo has taken any step to appeal the original judgment. He has been granted four stays of execution of the writ and the matter has now been outstanding for many months. The Court has extended every possible indulgence to Mr Madormo.

Furthermore, it appears from my examination of the file that at every turn appropriate allowance has been made for the fact that Mr Madormo has not had legal representation. However, the fact that Mr Madormo is not legally represented is also not in and of itself a reason to keep the plaintiff out of its rights yet again. While each situation is fact specific, in order to afford procedural fairness the Court will extend every proper, possible indulgence to a party who is not legally represented. Nevertheless, both parties to litigation must be treated fairly. Ultimately the fact that a party is unrepresented cannot be allowed to become an instrument of procedural or substantive unfairness to an opposing party which happens to be represented.

The order of the Court will be that the Mr Madorno’s oral application for a further stay of the writ of execution that was made ex parte early this morning and continued at this latest, contested hearing is dismissed.

As appears from page 4 of Wilson J’s second judgment, her Honour was of the view that, in the circumstances of the case as they were before her, there should be no order as to costs. That is the appropriate outcome again today. Quite properly, Mr Koning has not sought to be heard against that result. JudgmentcWilson J - 8 Jan 2019_2019_02_25_15_50_22_572 (253 KB, pdf) JudgmentcWilson J - 11 Jan 2019_2019_02_25_15_51_04_863 (138 KB, pdf)