Portcam Pty Ltd trading as Edge Residential Real Estate v Mervyn Keane [2021] NSWDC 686

Mr Keane (the Applicant) filed a notice of motion on 10 August 2021 whereby he sought to have a default judgment set aside on the basis that it was obtained irregularly by Portcam Pty Ltd trading as Edge Residential Real Estate (the Respondents).

In this Application, his Honour Justice Wilson dealt with two issues:

  1. Whether service was effected on the Applicant noting that he resided in Victoria and substituted orders for services were obtained;
  2. Whether the plaintiff was required to comply with the Service and Execution of Process Act 1992 (Cth) (SEPA).

SEPA deals with the interstate service of Court documents including originating process and the enforcement of Court orders outside the relevant State or Territory in which they are made. SEPA allows initiating processes to be served interstate if certain requirements are complied with.

The Applicant sought to set aside default judgment on the basis that the Respondent failed to serve the Applicant with a copy of the a ‘Form 1 Notice’ prescribed in Schedule 1 of SEPA with the statement of claim filed in the District Court of New South Wales and this invalidated the service of the claim.

A form 1 Notice found in SEPA advises readers:

  • to obtain legal advice with respect to the claim;
  • that a transfer/stay application is possible if they consider another jurisdiction or court to be more appropriate to deal with the dispute; and
  • that if they wish to defend the claim, they must file an appearance and a defence in the proceedings.

Was service of the Statement of Claim effected?

The Court noted that this was a factual matter and this was subject to debate between the parties as to whether the Applicant had actually received the statement of claim by way of substituted service orders.

The substituted orders allowed for the Applicant to be served by way of ordinary post to his residential address and that the statement of claim, along with application for substituted services orders, be forwarded to the Respondent’s known email address. Service of the Statement of Claim was completed in accordance with the orders.

Was service compliant with the Law?

Both parties addressed the application of SEPA in the circumstances and the failure to attach a Form 1 Notice as prescribed by the Act.

However, section 8 of the Act states that SEPA will not effect a Court’s power to grant substituted service in circumstances where they have been unable to personally serve a defendant. It was then necessary for the Court to consider the orders made in the proceedings for substituted service on 3 June 2021.

His Honour noted that there was no reference to compliance with SEPA and therefore this dispensed with the need for the Respondent to comply with the requirements when serving the claim.

Through the course of submissions by the parties, the Applicant’s Counsel did make the concession that an email forwarded on 4 June 2021 enclosing the statement of claim was opened by the Applicant on 7 June 2021.

It was therefore apparent that the Statement of Claim was received via email pursuant to the orders made by the Registrar and the Applicant was therefore aware of the proceedings on foot. Once the Statement of Claim was received, the Applicant began making enquiries for legal representation and instructions were provided to solicitors by 2 July 2021. In consideration of the Applicant’s conduct after receiving the Statement of Claim, his Honour noted that it was “difficult to see what practical difference an attached Form 1 Notice would have made”. His Honour also noted that it appeared that the delays between services and the default judgment entered were based on the Applicant’s own conduct.

Ultimately his Honour found that even if the Respondent had attached a Form 1 Notice to the Statement of Claim served by way of email, the practical impact upon the facts of this case “would be minimal to non-existent”.

This judgment is an important reminder regarding the merits of arguments brought before the Court in setting aside default judgment and that minor procedural irregularities will not automatically invalidate a default judgment.