Rados Stevanovic v The Free Serbian Orthodox Church St Nicholas, Reverend Father Dragan Saracevic & Ors [2004] NSWIRComm 329 (1 November 2004)

Last Updated: 5 November 2004

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Rados Stevanovic v The Free Serbian Orthodox Church St Nicholas, Reverend Father Dragan Saracevic & Ors [2004] NSWIRComm 329

FILE NUMBER(S): IRC 4344

HEARING DATE(S): 21/09/2004, 14/10/2004

DECISION DATE: 01/11/2004

PARTIES:

APPLICANT

Rados Stevanovic

FIRST RESPONDENT

The Free Serbian Orthodox Church, St Nicholas

SECOND RESPONDENT

Reverend Father Dragan Saracevic

& ORS

JUDGMENT OF: Backman J

LEGAL REPRESENTATIVES

APPLICANT

Mr M. Perry (of counsel) with Ms Rita Mallia (CFMEU)

SECOND RESPONDENT

Rev. Fr. Dragan Saracevic (self)

CASES CITED: Cardile & Ors v LED Builders Pty Limited (1999) 198 CLR 380

Jackson v Sterling Industries Limited (1987) 162 CLR 612

Patterson v BTR Engineering (Aust) Ltd & Ors (1989) 18 NSWLR 319

Cooper v Sithe Energies Limited & Anor (2000) NSW IRComm 176

Frigo v Culhaci (unreported 17 July 1998)

Riley McKay Pty Limited v McKay & Anor (1982) NSWLR 264

Ausbro Forex Pty Ltd v Mare & Ors (1986) 4 NSWLR 419

Brigitte Lipman & Anor v AG Lifestyle Management Pty Limited & Anor (2001) NSW IRComm 115

LEGISLATION CITED: Industrial Relations Act 1996

JUDGMENT:

JUDGMENT:

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

IN COURT SESSION

CORAM: Backman J

1 November 2004

Matter Number IRC 4344 of 2002

RADOS STEVANOVIC v THE FREE SERBIAN ORTHODOX CHURCH ST NICHOLAS, REVEREND FATHER DRAGAN SARACEVIC & ORS

Application under section 106 of the Industrial Relations Act 1996

JUDGMENT

[2004] NSWIRComm 329

Introduction

1. By Notice of Motion filed on 6 July 2004 the applicant, Rados Stevanovic ("the applicant") seeks Mareva Orders against Reverend Father Dragon Saracevic, the second respondent ("the second respondent"). Those orders, relevantly, are in the following terms:

"that the Second Respondent be restrained ... from by himself and his agents, removing, or causing or permitting to be removed from the State of New South Wales or selling, charging, mortgaging or otherwise dealing with or disposing of, or causing or permitting to be sold, charged, mortgaged or otherwise dealt with or disposed of, all or any of his assets within the State of New South Wales including, but without affecting the generality of the foregoing:

1. Legal and/or equitable interest in Lot 1304 in Deposited Plan 877493 at Glenwood - Registrar-General's folio identifier 1304/877493.

2. Legal and/or equitable interest in Lot 63 in Strata Plan 32542 at Blacktown - Registrar-General's folio identifier: 63/SP32542.

PROVIDED that this order:

(a) shall not apply to so much of the assets of the Second Respondent within the State of New South Wales as exceed in value the sum of $350,000.00;

(b) shall not prevent the Second Respondent from paying ordinary expenses up to an amount of $500.00 per week;

(c) shall not prevent any bank from exercising any rights of set-off which it may in respect of any facility afforded by it to the Second Respondent prior to the date of the order.".

2. I heard the application over two days on 21 September and 14 October 2004. On both occasions, the applicant was represented by Mr Perry of Counsel, the second respondent represented himself. The applicant and the second respondent each were provided with the services of an interpreter in the Serbian language.

3. On 21 September 2004, by consent of the parties, the applicant was granted temporary Mareva Orders to operate up to and including 14 October 2004.

4. The applicant also seeks substantive relief pursuant to section 106 Industrial Relations Act 1996 ("the Act"). On 21 September, this matter was set down for hearing for five days commencing on 14 March 2005. The second respondent is one of seventeen respondents nominated in the Amended Summons for Relief ("the Amended Summons") under section 106 of the Act.

The Evidence on the Notice of Motion

5. The Amended Summons alleges that the applicant, an artist with many years experience in the restoration and painting of church murals, frescoes, mosaics and also sculpture, was approached by the second respondent in Australia, sometime in 1997, to paint frescoes and icons inside the St Nicholas Serbian Orthodox Church at Blacktown. At that time the respondent, it is alleged, undertook to organise immigration formalities including a work visa and permanent residency. The Amended Summons also alleges that the second respondent promised the applicant that he would be remunerated for the work done.

6. There was evidence tendered by the applicant which suggests that the second respondent played a prominent role in facilitating immigration formalities on behalf of the applicant thereby enabling the applicant to remain in Australia in order to paint the frescoes and icons in the interior of the Church.

7. That evidence included a letter, and a translation of that letter into English, dated 21 January 1997 addressed to the Australian Embassy in Belgrade signed by the second respondent on letterhead which would appear to contain the names of both the first and third respondents named in the Amended Summons.

8. I should interpolate here that both entities appearing in the letterhead are described in slightly different terms in the Amended Summons. The first respondent is described in the Amended Summons as "The Free Serbian Orthodox Church School Congregation St Nicholas" and the third respondent in the Amended Summons is described as "The Free Serbian Orthodox Church for Australia and New Zealand". The letterhead on the 21 January 1997 letter describes the first respondent as "Serbian Orthodox Church School Congregation Saint Nicholas" and the third respondent as "Serbian Orthodox New Gracanica Metropolia Diocese for Australia and New Zealand". On 14 October 2004 I brought these discrepancies to the attention of the second respondent who informed the Court that the entities nominated in the Amended Summons as the first and third respondents are the same entities contained in the letterhead.

9. For the purposes of this application I am prepared to accept that the entities as described in the Amended Summons are the same entities contained in the 21 January 1997 letterhead.

10. In the letter of 21 January the second respondent advised the Australian Embassy that the "Church-School Congregation" wished to retain the services of the applicant to paint frescoes in the Byzantine style. The letter also referred to the applicant's accommodation arrangements and various costs and preparation associated with the work. A visitor's visa was sought for the applicant in the letter.

11. A second letter dated 12 February 1998 addressed to the Department of Immigration and Multicultural Affairs ("the Department") on the first and third respondent's letterhead signed by the second respondent as "Parish Priest" informed the Department that the "Church Board" has decided to sponsor the applicant to obtain a visitor's visa in order to renovate the interior of the Church by painting frescoes and icons in the Byzantine style.

12. An application dated 12 February 1998 to the Department for Nomination by a Business Sponsor formed part of the evidence tendered by the applicant. This application which appears to be signed by the second respondent as "Parish Priest/secretary" (although there was no direct evidence of this) nominated the Free Serbian Orthodox Church as the applicant's sponsor and contained details concerning the applicant's job description, weekly hours of work (35 hours) and annual salary ($35,000.00).

13. The applicant commenced painting frescoes and icons in the Church of St Nicholas at Blacktown from about 10 May 1997 until about 11 December 2001. The applicant says that during that time he was paid, although sporadically and only about $32,800.00 by the second respondent and was forced to make requests to the second respondent for money, however his requests were refused. Relations between the applicant and the second respondent, says the applicant, deteriorated over this period until 11 December when the applicant refused to do any further work for the Church.

14. The applicant's affidavit accompanying the Notice of Motion deposes to, "a number of rumours" concerning a transfer of the second respondent to another church. The source of these rumours is not identified by the applicant. The affidavit also deposes to information from "some people", (not identified) that the second respondent plans to leave Australia in order to avoid paying the applicant any money and to information from those same unidentified persons that the second respondent has said that he has transferred his property to his wife and children.

15. Evidence by way of affidavit was also relied upon by the applicant from Marko Micac. Mr Micac says that around the end of May 2004 in York Street Sydney he met the second respondent who told him that he did not have any property in his own name because on the advice of his solicitors he had transferred all his property to his wife and children. The second respondent cross-examined Mr Micac in relation to the alleged location where the conversation was alleged to have occurred, although there was no cross-examination on the content of the conversation.

16. The second respondent tendered a number of letters in his case including a letter dated 18 August 2002 from the "Executive Board" (also referred to in the letter as the "Executive Committee") and signed by Ilija Vitorovic as president and Andrija Tadich as secretary. (I note in passing that Mr Vitorovic is nominated as the seventh respondent in the Amended Summons.) The letter stated that the second respondent had been appointed by the Executive Committee, "...to act as an intermediary and spokesperson and furthermore to co-ordinate the work conducted by (the applicant)"; and, that "...under such appointment, at all times he acted under supervision, guidance, directives and control of the Executive Committee with their express knowledge and approval".

17. A second letter tendered by the second respondent dated 2 February 2003 was signed by Mr Vitorovic and Mr Tadich as president and secretary respectively "on behalf of the Executive (Managing) Committee". This letter states that the second respondent is not a member of the Executive (Managing) Committee but is an ex officio member of that Committee because of his position as a parish priest under Article 36 of the Constitution of the first respondent and under Article 113 of the Constitution of the third respondent. The latter Constitution ("the Constitution") was tendered into evidence by the applicant.

18. Under Article 113 of the Constitution, there appears a sub-heading entitled "The Executive Committee" which states:

The Executive Committee is elected at the regular Annual General Meeting of the Church-School Congregation together with all the other Boards for the period of one year. By virtue of his ex officio, the Priest is a member of the Executive Committee also (sic).

19. Several Articles in the Constitution shed some light on the respective roles and relationship between the first, second and third respondents. Article 5 states that the third respondent is "comprised of" the first respondent and other Church-School Congregations, churches, parishes etc established within Australia and New Zealand. Article 7 states that the various bodies referred to in Article 5 are "lawful bodies" and have the right to handle their own affairs and obligations. Article 9 makes clear that the Constitution regulates the various bodies and Church authorities making specific reference to the Free Serbian Orthodox Church-School Congregations.

20. Articles 83 to 92 deal expressly with Church-School Congregations. Article 84 states that such bodies are considered to be an integral part of the third respondent and as such are subject to, among other things, the orders of the Diocesan authorities headed by the Bishop.

21. Articles 111 to 118 concern the Executive Committee of Church-School Congregations. Article 111 states that the Committee stands at the head of the Church-School Congregations and that the Committee consists of a Managing Executive Board and other boards which for present purposes are not relevant. Article 118 sets out the authority of the Executive Committee. That authority includes the governing and handling of real estate and financial funds of the Church-School Congregation and its maintenance; determining the means of acquiring funds for building and repair of the church; and, to propose to the general meeting of the Church-School Congregation the manner of payment of the parish priest.

22. Articles 132 to 164 describe the role of the parish priest. Under Article 141 the parish priest is said to be under the direct control of the Diocesan Bishop. Article 147 sets out the duties of the parish priest. Those duties do not include any financial duties but appear to be confined to religious and educational duties and some administrative matters such as keeping Church records. Under Article 161 the wages of the parish priest are to be determined by the Church-School Congregation in agreement with the Diocesan Education Board.

23. The second respondent's reply to the applicant's Summons for Relief asserts that the Committee (presumably of the Church-School Congregation of St Nicholas) is an unincorporated body under whose authority the second respondent has acted at all times.

24. The second respondent in his oral evidence denied Mr Micac's account of a meeting in York Street in May 2004 and the contents of the conversation. He was not cross-examined on any aspect of Mr Micac's evidence. The second respondent did concede that as parish priest, but not in his capacity as a committee member, he was responsible for "certain irregularities" relating to payments made to the applicant for work done at the Church of St Nicholas. The reference to "certain irregularities" is a reference to a finding made on 4 May 2004 in the Ecclesiastical Court, against the second respondent that he was responsible with other members of the Executive Committee for the engagement of the applicant and payment arrangements concerning the applicant's work in the Church of St Nicholas (Exhibit R4). (According to the Constitution, the Ecclesiastical Court consists of the Diocesan Bishop and two members (Article 50) and has various responsibilities including judgment in Church disciplinary matters (Article 61(5)).

Principles concerning Mareva Orders

25. Although the applicant in submissions referred to the orders sought in the Notice of Motion as a "Mareva injunction" it is clear from the authorities that the correct term is "Mareva Order": Cardile and ors v LED Builders Pty Limited (1999) 198 CLR 380 at 393 to 401.

26. There are numerous judicial statements on the scope and purpose of a Mareva Order. In Jackson v Sterling Industries Limited (1987) 162 CLR 612 the Mareva Order (there referred to as a "Mareva injunction") is described as:

"... (an order) to enable a court to protect its process from abuse in relation to the enforcement of its orders" (per Wilson, Dawson JJ at 619); and

"a remedy which is incidental to the exercise by a court of its jurisdiction to enter judgment for a debt or damage and which is designed to prevent the defendant from divesting himself of his assets whereby enforcement of such judgment might be frustrated" (per Brennan J at 621); and,

"(an order) to prevent a defendant from disposing of his actual assets (including claims and expectancies) so as to frustrate the process of the Court by depriving the plaintiff of the fruits of any judgment obtained in the action" (per Deane J at 625).

27. Other judicial statements emphasise the need for caution when entertaining applications for a Mareva Order on the basis that the imposition of a partial or complete freeze on someone's assets, "is no light matter": Patterson v BTR Engineering (Aust) Ltd and others (1989) 18 NSWLR 319 at 324; see also Cooper v Sithe Energies Limited and Anor (2000) NSW IRComm 176 at 22 to 26 per Boland J.

28. In Cardile v LED Builders reference is made to the decision in Frigo v Culhaci (unreported 17 July 1998) in which it was stated that a Mareva Order is, "...a drastic remedy which should not be granted lightly", and, "...an interlocutory order which, if granted, imposes a severe restriction upon a defendant's right to deal with his or her assets". Other cautionary notes are sounded in Cardile v LED Builders in relation to the grant of the order; for example, the need to carefully weigh discretionary considerations such as whether the applicant has proceeded diligently and expeditiously and whether if proceedings are available against a third party why such proceedings have not been taken (at 404).

29. The relevant test to be applied by a court in assessing whether to grant an application for Mareva Orders has been extensively addressed in the relevant case law.

30. In Riley McKay Pty Limited v McKay and anor (1982) NSWLR 264 at 276, the NSW Court of Appeal concluded that the basis of jurisdiction for the grant of a Mareva Order is founded on the risk that a defendant will so deal with his assets that, "...he will stultify and render ineffective any judgment given by the Court in the plaintiff's action, and thus impair the jurisdiction of the Court and render it impotent to properly and effectively administer justice in New South Wales".

31. The Court of Appeal then proceeded to detail the matters that must be established in order to obtain a Mareva Order as follows:

(i) an evaluation of whether the plaintiff has made out a "sufficiently

strong case" to justify the grant;

(ii) an evaluation of the balance of convenience;

(iii) general discretionary considerations.

After detailing the above matters, the Court emphasised the importance of keeping in mind that they are inter-related and overlap to a greater or lesser extent, particularly the first and second matters.

33. In Ausbro Forex Pty Ltd v Mare and ors (1986) 4 NSWLR 419 at 423 per Young J the test set out in Riley McKay was formulated somewhat differently as the need to consider, "a prima facie case, the balance of convenience and general discretionary considerations ...".

34. In the Court of Appeal, NSW decision of Patterson v BTR Engineering, Gleeson CJ (at 321F) described the relevant test as requiring, as a general rule, the need to establish:

(i) a prima facie cause of action against the defendant, and,

(ii) a danger that by reason of the defendant's absconding, or of

assets being removed out of the jurisdiction or disposal of them

within the jurisdiction or otherwise dealing with in some fashion, the plaintiff if he succeeds will not be able to have his judgment satisfied.

35. In the same case Meagher JA (at 326C) spoke of the need of the plaintiff to prove two ingredients, first that he has a prima facie case against the defendant, and secondly that there is "some risk" of disposal of assets by the defendant, so as to defeat the nature of the plaintiff's victory if he ultimately wins.

36. In relation to the standard of proof required to show the relevant danger or risk, Gleeson CJ thought it undesirable to formulate a precise definition of the standard of proof required to make out the relevant danger or risk (323F to 324C). Meagher JA on the other hand thought that a plaintiff is required to prove a risk of disposition of assets on a balance of probabilities (327A).

37. From these various judicial pronouncements the following principles may be distilled:

(i) the remedy known as a Mareva Order is discretionary;

(ii) such orders will not be lightly granted;

(iii) in order to successfully apply for such an order an applicant must establish:

(a) a prima facie cause of action, and,

(b) a risk of absconding or of disposition or otherwise dealing by a defendant of assets such that an applicant if successful in the substantive proceedings will not be able to have his judgment satisfied;

(iv) there is no precise definition of the standard of proof required to make out the relevant risk.

Application of the Legal Principles to the Evidence

38. The evidence before me establishes the first limb of the applicable test for a Mareva Order namely, whether there is a prima facie cause of action against the second respondent.

39. The correspondence tendered in evidence by both parties and the applicant's affidavit evidence together show that the second respondent was involved in obtaining the services of the applicant to undertake the renovation of St Nicholas Church. This involvement included the arrangement of immigration formalities, accommodation and remuneration for the work done. The evidence also suggests the applicant was not fully remunerated for the work done.

40. What is not clear is whether the individual involvement by the second respondent in the applicant's performance of the work was in his capacity as a parish priest acting alone or in some other capacity such as acting under the authority of either the first or third respondents or a combination of both.

41. I note that in the second respondent's Reply to the applicant's Summons for Relief, it is asserted that the second respondent has, in relation to his involvement with the applicant, at all times acted as the agent of the Committee which is an "unincorporated body".

42. The evidence before me suggests that both the first and third respondents are unincorporated bodies. The effect of that, of course, is that the first and third respondents are not juridical persons and therefore are unable to sue or be sued.

43. At this preliminary stage, I do not need to finally determine that matter.

44. The second limb of the test requires that a risk of disposition of assets within the jurisdiction be established such that an applicant, as a party to the substantive proceedings, will, if successful in those proceedings, not be able to have his judgment satisfied.

45. The evidence on this limb of the test consists largely of assertions and rumours which have not been sourced to identified persons. This evidence is not enough by itself to establish any relevant risk. Something more is required: see Patterson v BTR Engineering at 323F; Brigitte Lipman & Anor v AG Lifestyle Management Pty Limited & Anor (2001) NSW IR Comm. 115 per Schmidt J at [21].

46. The assertion relied upon by the applicant was that the second respondent was alleged to have transferred his property to his wife and children at some unidentified time. This evidence arose in the context of Mr Micac's evidence of a conversation he said occurred sometime in May 2004 between himself and the second respondent. The applicant's evidence on the point was based on "a number of rumours" from unidentified persons.

47. In addition, the second respondent who gave sworn evidence was not cross-examined at all about any evidence of a transfer or other dealing of his properties.

48. The applicant, in written submissions, concedes that the evidence of any risk of either absconding or of disposition of assets is "tenuous", but relies on the whole of the circumstances before the Court on the application including certain additional discretionary factors to establish the relevant risk. The discretionary factors relied upon by the applicant include the information that since 5 November 2003 the second respondent has failed to attend "certain" directions hearings and has failed to respond to correspondence. Also, the applicant understands that the second respondent is no longer in the employ of the first and/or third respondents and has filed an unfair dismissal application under s84 of the Act.

49. These additional factors upon which the applicant placed reliance add little to the evidence led by the applicant to establish a risk of absconding or of disposition of his assets.

50. For all these reasons, I decline to make the orders sought against the second respondent in the Notice of Motion.

51. I reserve on the questions of costs.

LAST UPDATED: 01/11/2004