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Supreme Court 22 August 2017

Kostov v YPOL Pty Ltd

[2017] NSWSC 1071

Public order & justice offences
CONTEMPT CRIMINAL CONTEMPT CONTUMACIOUS BREACH OF COURT ORDER PUNITIVE PURPOSE OF CONTEMPT CHARGE CRIMINAL CONTEMPT FITNESS INQUIRY

Citation: Kostov v YPOL Pty Ltd [2017] NSWSC 1071
Court: Supreme Court of New South Wales
Date: 22 August 2017
Judge: Fagan J

Background

The plaintiff was a party to civil proceedings against the first defendant, YPOL Pty Ltd. On 1 December 2016, Bellew J made an order restricting communications between the plaintiff and the defendant's personnel and solicitors to a designated email address. Between 2 December 2016 and 27 March 2017, the plaintiff repeatedly breached that order by communicating through other means.

In March 2017, Fagan J heard the defendant's contempt charge in the plaintiff's absence, after refusing an adjournment application made by phone. The Court declared that the plaintiff had committed contempt and recorded a conviction. Determination of penalty was reserved, and the matter returned in August 2017 for that purpose.

By the time of the penalty hearing, psychiatric evidence had emerged that the plaintiff suffered from bipolar disorder throughout the period of the breaches. That evidence prompted both a tutor appointment for the civil proceedings and a series of contested questions about the validity of the conviction and the plaintiff's fitness to face sentencing.

  • Whether r 36.16(2)(b) of the Uniform Civil Procedure Rules 2005 (NSW) could be used to set aside a declaration of contempt and a conviction entered in the plaintiff's absence
  • Whether the contempt as charged and proved was criminal in nature (as opposed to civil), with consequences for which procedural regime applied
  • Whether the Mental Health (Forensic Provisions) Act 1990 (NSW) applied to fitness inquiries in contempt proceedings
  • Whether the plaintiff was unfit to be sentenced according to the criteria in R v Presser [1958] VR 45
  • What penalty, if any, was appropriate given the plaintiff's psychiatric illness

Decision

Criminal contempt and the inapplicability of the UCPR

Fagan J found that the contempt as charged was criminal in character, not civil. Because the UCPR apply only to civil proceedings, r 36.16(2)(b) was simply unavailable as a mechanism to set aside the declaration and conviction. The plaintiff's notice of motion seeking to invoke that rule was dismissed on this threshold ground, without the Court needing to reach the merits of her explanation for absence or whether a triable issue existed.

Fitness to be sentenced

The Court accepted psychiatric evidence from Dr Andrew Ellis that the plaintiff suffered from bipolar disorder, which had affected her throughout both the period of the breaches and the subsequent proceedings. Fagan J held that the Mental Health (Forensic Provisions) Act 1990 (NSW) did not apply to contempt proceedings of this kind. Instead, the Court applied the common law fitness criteria from R v Presser and found the plaintiff unfit to be sentenced.

Proceeding to finality despite unfitness

Despite the finding of unfitness, Fagan J concluded it was appropriate to proceed to finality rather than impose an indefinite stay. The Court reasoned that no detriment to the plaintiff resulted from doing so, because the outcome was the imposition of no penalty. The psychiatric illness had substantially diminished the plaintiff's moral culpability for the breaches, and that diminution was the basis for invoking s 10A of the Crimes (Sentencing Procedure) Act 1999 (NSW) to record the matter without imposing punishment.

Tutor appointments

Separate from the contempt proceedings, Fagan J found the plaintiff to be under a legal incapacity for the purposes of the civil proceedings, within the meaning of r 7.13 of the UCPR. The NSW Trustee and Guardian was initially appointed as tutor, then replaced by a proposed social worker, Ms Mary Jelen. Ms Jelen ultimately withdrew her consent before the judgment was delivered, and she was removed. As a result, the plaintiff was left unable to take any further step in the substantive civil proceedings until a new tutor is appointed.

Orders Made

  • The plaintiff's notice of motion filed 7 July 2017 (seeking to set aside the conviction and declaration) was dismissed.
  • On the defendant's notice of motion for contempt, no penalty was imposed pursuant to s 10A of the Crimes (Sentencing Procedure) Act 1999 (NSW).
  • The plaintiff was ordered to pay the defendant's costs of both notices of motion.
  • The non-publication order made 11 July 2017 (as varied 7 August 2017) was vacated, subject to a 28-day stay.
  • Ms Mary Jelen was removed as tutor in relation to the civil aspect of the proceedings.
  • The Court noted that the plaintiff, having been found to be under a legal incapacity, may not continue or take any step in the substantive civil proceedings unless and until a tutor is appointed by court order.
  • Copies of the reasons were to be forwarded to Dr Andrew Ellis and Dr Nicholas Babidge, Clinical Director, Department of Psychiatry, St Vincent's Hospital.
  • Publication of the judgment was restricted until 20 September 2017, except for copies provided for the purpose of the plaintiff's health care.

Key Takeaways

  • Criminal contempt proceedings are not "civil proceedings" within the meaning of the UCPR, and r 36.16(2)(b) therefore cannot be used to set aside a conviction for criminal contempt entered in a party's absence.
  • The Mental Health (Forensic Provisions) Act 1990 (NSW) does not govern fitness inquiries arising in contempt proceedings; the applicable standard is the common law test from R v Presser.
  • Where a fitness concern arises after conviction but before sentencing, the court retains a discretion to proceed to finality if the contemnor suffers no detriment from doing so, particularly where the outcome is the imposition of no penalty.
  • Psychiatric illness that substantially diminishes moral culpability can warrant the use of s 10A of the Crimes (Sentencing Procedure) Act 1999 (NSW) to dispose of a criminal contempt charge without imposing any punishment.
  • A finding of legal incapacity under the UCPR prevents a party from taking any further step in civil proceedings without a tutor appointed by court order, regardless of how the associated contempt proceedings are resolved.

Legislation and Cases Referenced

Legislation
- Uniform Civil Procedure Rules 2005 (NSW), rr 7.13, 7.14, 7.18, 36.16
- Crimes (Sentencing Procedure) Act 1999 (NSW), s 10A
- Mental Health (Forensic Provisions) Act 1990 (NSW)
- Mental Health Act 2007 (NSW)
- Civil Procedure Act 2005 (NSW)
- NSW Trustee and Guardian Act 2009 (NSW), s 41(1)(b)
- Supreme Court Act 1970 (NSW)
- Criminal Procedure Act 1986 (NSW)

Cases
- Kostov v YPOL Pty Ltd [2017] NSWSC 341 (conviction judgment)
- R v Presser [1958] VR 45 (fitness criteria)
- Witham v Holloway (1995) 183 CLR 525 (civil vs criminal contempt)
- Magnate Projects Pty Ltd v Youma Constructions (No 2) Pty Ltd [2005] NSWCA 331 (r 36.16 applications)
- Murphy v Doman [2003] NSWCA 249 (legal incapacity)
- Eastman v The Queen (2000) 203 CLR 1 (fitness inquiries)
- Kesavarajah v The Queen (1994) 181 CLR 230
- Hinch v Attorney-General for Victoria (1987) 164 CLR 15
- Hearne v Street (2008) 235 CLR 125
- ASIC v Sigalla (No. 4) (2011) 80 NSWLR 113
- Principal Registrar Supreme Court of NSW v Jando (2001) 53 NSWLR 527
- Director of Public Prosecutions (Cth) v De La Rosa (2010) 79 NSWLR 1