Acetime Pty Ltd v Homestyle Pty Ltd
[2007] WADC 33
•14 February 2007 typed from tape and edited by Principal Registrar
ACETIME PTY LTD -v- HOMESTYLE PTY LTD [2007] WADC 33
| DISTRICT COURT OF WESTERN AUSTRALIA | Citation No: | [2007] WADC 33 | |
| Case No: | CIV:2168/2004 | 14 FEBRUARY 2007 | |
| Coram: | PRINCIPAL REGISTRAR GETHING | 13/02/07 | |
| PERTH | |||
| 10 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| PDF Version |
| Parties: | ACETIME PTY LTD HOMESTYLE PTY LTD |
Catchwords: | Abuse of process Inactive list Breach of entry for trial milestone |
Legislation: | Nil |
Case References: | Acetime Pty Ltd v Homestyle Pty Ltd [2006] WADC 65 Batistatos v Roads and Traffic Authority of New South Wales (2006) 80 ALJR 1100 Costa Carrera Nominees Pty Ltd & Anor v Chelsford Pty Ltd & Ors, unreported; SCt of WA; Library No 940229; 21 April 1994 Magenta Nominees Pty Ltd v Bonini & Ors [1999] WASC 88 State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146 Brogden v Metropolital Railway Co (1877) 2 App Cas 666 Bruce v Odhams Press Ltd [1936] 1 KB 697 Christmas Island Resort Pty Ltd v Geraldton Building Co Pty Ltd (No 5) (1997) 18 WAR 334 Culbert v Stephen G Westwell & Co Ltd [1993] PIQR P54 Grovit v Doctor [1997] 2 All ER 417 Hughes v Gales (1995) 14 WAR 434 Packer v Meagher [1984] 3 NSWLR 486 Roddan v GWilliam & Anor [2005] WASCA 209 West Coast Clothing Co Pty Ltd v Sail America Foundation for International Understanding, unreported; SCt of WA; Library No 940482; 7 September 1994 |
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
HOMESTYLE PTY LTD
Defendant
Catchwords:
Abuse of process - Inactive list - Breach of entry for trial milestone
Legislation:
Nil
Result:
Application dismissed
(Page 2)
Representation:
Counsel:
Plaintiff : Mr B W Ashdown
Defendant : Mr C A Luck
Solicitors:
Plaintiff : A J Lloyd
Defendant : Corrs Chambers Westgarth
Case(s) referred to in judgment(s):
Acetime Pty Ltd v Homestyle Pty Ltd [2006] WADC 65
Batistatos v Roads and Traffic Authority of New South Wales (2006) 80 ALJR 1100
Costa Carrera Nominees Pty Ltd & Anor v Chelsford Pty Ltd & Ors, unreported; SCt of WA; Library No 940229; 21 April 1994
Magenta Nominees Pty Ltd v Bonini & Ors [1999] WASC 88
State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146
Case(s) also cited:
Brogden v Metropolital Railway Co (1877) 2 App Cas 666
Bruce v Odhams Press Ltd [1936] 1 KB 697
Christmas Island Resort Pty Ltd v Geraldton Building Co Pty Ltd (No 5) (1997) 18 WAR 334
Culbert v Stephen G Westwell & Co Ltd [1993] PIQR P54
Grovit v Doctor [1997] 2 All ER 417
Hughes v Gales (1995) 14 WAR 434
Packer v Meagher [1984] 3 NSWLR 486
Roddan v GWilliam & Anor [2005] WASCA 209
West Coast Clothing Co Pty Ltd v Sail America Foundation for International Understanding, unreported; SCt of WA; Library No 940482; 7 September 1994
(Page 3)
1 PRINCIPAL REGISTRAR GETHING: By chamber summons dated 15 December 2006 the defendant sought various orders from the Court arising out of the dilatory way in which it says that the plaintiff has conducted this action. Four main arguments were pressed in submissions as follows: first, the action be struck out as an abuse of process in the exercise of the inherent power of this Court; second, that the action be dismissed for want of prosecution, again relying on the inherent powers of the Court; third, that in the event that the action be permitted to remain on foot, the plaintiff ought to provide security for costs in order to prevent an apprehended abuse of the process of the Court; and, finally and fourthly, that the reply and defence to counterclaim filed on 7 December 2006 was filed without the leave of the Court, that such leave ought not to be granted, that the pleading be struck out and that default judgment be entered on the counterclaim.
2 This action is currently in the inactive list in the Court. The entry for trial milestone was set down to expire on 5 December 2006. On 6 December 2006 a Form 2 notice of default was issued to the plaintiff. That notice was not complied with and the action is currently inactive. By Chamber summons dated 9 January 2007 the plaintiff has sought orders removing the action from the inactive list, excusing it from entering the action for trial and orders that the defendant provide a response to a request for further and better particulars filed by the plaintiff relating to the defendant's defence and counterclaim.
3 I have deferred argument on the question of further and better particulars. On the issue of the removal of the case from the inactive list, I have heard argument on that at the same time as the defendant's application given that the issues substantially overlap.
4 The history of this action is set out in detail in the decision of Stavrianou DCJ on 20 April 2006 reported at Acetime Pty Ltd v Homestyle Pty Ltd [2006] WADC 65 in an earlier decision in this action. There are, however, a couple of key points for present purposes. In a previous action in this Court between the same parties (under the action number CIV 487 of 2003) the plaintiff's claim was dismissed following a failure to comply with a springing order in relation to the filing of a substituted statement of claim. Judgment was given in January 2004.
5 This present action (CIV 2168 of 2004) was commenced in September 2004. In it, the plaintiff claims the same relief as in the previous action arising out of the same factual scenario. In September 2005 an application brought by the defendant was heard, on which
(Page 4)
- occasion the writ and statement of claim were struck out. This decision was subsequently taken on appeal and the decision on the appeal was the decision of his Honour Judge Stavrianou to which I have previously referred.
6 On the appeal it was ordered that the statement of claim be struck out and that the plaintiff have leave to file and serve a minute of amended statement of claim. There was then an appeal from the decision of his Honour Judge Stavrianou by the plaintiff to the Court of Appeal which was subsequently discontinued. On 7 August 2006 the defendant filed its defence and counterclaim. On 7 December 2006 the plaintiff filed a reply and defence to counterclaim.
7 The essence of the defendant's submission is that the inordinate delays which the plaintiff has subjected the defendant to in the conduct of the action are such as to amount to an abuse of process. The failure to enter the action for trial in accordance with the milestone set in the District Court Rules should be viewed as the plaintiff having missed its last chance to progress the action further in this Court.
8 The question of what constitutes an abuse of process was recently considered by the High Court in Batistatos v Roads and Traffic Authority of New South Wales (2006) 80 ALJR 1100. The context was one in which the plaintiff's claim had been permanently stayed as an abuse of process. The relevant principles are set out in the joint judgment of the Gleeson CJ and Gummow, Hayne and Crennan JJ. Their Honours discussed the concept of what amounts to an abuse of process in some detail. Their Honours then reiterated the discretionary nature of the inherent power in a court to control its own processes (at pp 1105-1106). Their Honours also noted the fact that the circumstances which will constitute an abuse of process cannot be defined. Specifically their Honours stated (p 1116):
"[I]n the circumstances of the present case attention must be directed to the burdensome effect upon the defendants of the situation that has arisen by lapse of time. The Court of Appeal held that this was so serious that a fair trial was not possible. The result was that to permit the plaintiff's case to proceed would clearly inflict unnecessary injustice upon the defendants."
(Page 5)
9 Their Honours went on to state that there is no requirement for the plaintiff to have engaged in some oppressive conduct to found the proper exercise of the power of the Court to control its own processes.
10 There is authority in the context of case management considerations that the gross disregard of case management orders may be such as to found the proper exercise of an order in the Court to control its processes for fear of them being abused. At par 1.4B.1A of Civil Procedure Western Australia the learned author comments:
"Litigants who deliberately and without proper excuse disobey orders will not be allowed to proceed with either a calculated or a reckless disregard for their obligations in the conduct of the litigation."
11 The author cites as authority for that proposition the decision in Magenta Nominees Pty Ltd v Bonini& Ors [1999] WASC 88.
12 In the context of case management regard must also be had to the decision of the High Court in State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146. Their Honours Dawson, Gaudron and McHugh JJ comment (at p 154):
"Case management is not an end in itself. It is an important and useful aid for ensuring the prompt and efficient disposal of litigation but it ought always to be born in mind even in changing times that the ultimate aim of a court is the attainment of justice and no principle of case management can be allowed to supplant that aim."
13 Their Honours also make the following comments at (p 155):
"Justice is the paramount consideration in determining an application such as the one in question. Save in so far as costs may be awarded against the party seeking the amendments, such an application is not the occasion for the punishment of a party for its mistake or for its delay in making the application. Case management, involving as it does the efficiency of the procedures of the court, was in this case a relevant consideration. But it should not have been allowed to prevail over the injustice of shutting the applicants out from raising an arguable defence, thus precluding the determination of an issue between the parties."
(Page 6)
14 I note that in the decision in Queensland v JL Holdings (supra) the High Court's position as to the conduct of a party against whom abuse of process is alleged is in similar terms to the comments made by members of the High Court in the Batistatos (supra) case. The emphasis in both is on the objective effect of the continuation of the action on the party alleging that the other has been guilty of an abuse of the process of the Court.
15 The starting point in this case in applying these principles is thus to consider the prejudice or burden to the defendant if the action is allowed to proceed. Counsel for the defendant pointed to two primary forms of prejudice. The first is that the costs in dealing with the various defaults and delays which have occurred in the conduct of the action to date are not able to be fully covered by costs orders, even indemnity costs orders. From the submissions of counsel it is apparent that the defendant is concerned that these delays and defaults will continue and that in the future it will incur costs in dealing with the defaults and delays which it will not be able to recover through the costs process.
16 The second broad ground of prejudice that the defendant points to is the fact that the events occurred in December 2001. As time goes on, this means that it is progressively more difficult for witnesses to recollect events. The defendant's concern is that the action is still a number of years away from trial and that by the time a trial occurs it will be prejudiced by the fact of the delay to trial.
17 In the affidavit evidence relied on by the defendant there is no evidence that any witness's recollection of the events has been impinged with the effluxion of time. Likewise there is no evidence that the defendant has lost contact with any of its witnesses. It is open for the defendant to take comprehensive proofs of the witnesses in question. It is also open for the defendant to ensure that all discovered documents are taken into its custody so that there will not be any issues as to the location of documents at the trial of the action. It is thus within the defendant's power to significantly minimise any prejudice that it may perceive it will suffer if the action takes a significant amount of time to go to trial.
18 On the other hand, the prejudice to the plaintiff of having this action struck out is that it loses its opportunity to pursue its claim. It may well be true, as counsel for the defendant submitted, that it may have a claim against its solicitors. However, that claim is necessarily much harder to pursue than the primary action.
(Page 7)
19 From a review of the pleadings, or at least the current versions of the pleadings, it appears that there is an arguable issue to be tried between the parties. The primary issue turns on whether or not the work carried out by the plaintiff from December 2001 was pursuant to a new contract with the defendant, as the plaintiff alleges, or pursuant to a novated contract from a company called Tandem Holdings Pty Ltd, as the defendant alleges. Tandem Holdings is now in external administration. At the relevant time it appears to have had the same director as the plaintiff.
20 Another relevant consideration is the remaining steps that need to be undertaken in order to progress this action at least to the point of entry for trial. The plaintiff in submissions stated that it would consent to an order that it provide discovery within 14 days and for the action to be entered for trial subject to a springing order for non-compliance. The time of the entry for trial would be as soon as is practicable having regard to the outstanding issues relating to further and better particulars. This is likely to result in an entry for trial milestone something in the order of 45 to 60 days. What this means is that in an action going back to facts occurring some six years ago and commenced in 2004 we are approximately 60 days from having it entered for trial.
21 The plaintiff also submits that the relevant delays in this action are not inordinate. It submits that any question of delay needs to be taken from the decision of his Honour Judge Stavrianou in April of this year. The plaintiff says that a minute of substituted statement of claim was filed on 27 April this year.
22 The defendant then took until 7 August to file its defence and counterclaim. The defendant points out that at least for some of this time there was a live appeal in process and it was not appropriate for it to file any defence and counterclaim. However, the appeal was discontinued on 13 June 2006 when the defendant filed a notice of discontinuance, thus the defence and counterclaim took approximately two months to complete following the discontinuance of the Court of Appeal proceedings.
23 The plaintiff then took a further four months until 7 December 2006 to file its reply and defence to counterclaim. It says that the delay in filing the reply and defence to counterclaim is of the same order of magnitude as the delay in filing and serving the defence and counterclaim. In each case the delay is explicable given the nature of the claim is one in the construction industry and given the documentary evidence involved.
(Page 8)
24 The plaintiff also relies on the affidavit of Trevor Robert Collins, the managing director of the plaintiff, sworn 13 February 2007. Counsel for the defendant was critical of this affidavit for a number of reasons. The first is that it was sworn and filed the day before this hearing. The second is that annexure TRC2 appears to be the wrong document. The third area of criticism was that it lacks the detail that might be expected of a plaintiff defending an abuse of process claim. However, what is clear from the affidavit is that over the course of September, October, November and December 2006 and January 2007 the plaintiff has been attempting to get further documents from the external administrator of Tandem Holdings.
25 In submissions, counsel for the plaintiff stated that the catalyst for getting these documents was receipt of the defendant's defence and counterclaim. In paragraph 17 Mr Collins deposes that in January 2007 he arranged to collect 20 archive boxes which appeared to him to be potentially relevant to the dealings between Tandem Holdings and the defendant. Those boxes were collected from the external administrator of Tandem Holdings. There is thus at least some explanation for the delays which have occurred in recent times.
26 The final issue as regards to delay is the fact that there is a live issue between the parties as to whether or not the defendant ought to provide further and better particulars of its defence and counterclaim. Those further and better particulars were requested by request dated 7 December 2006 and are the subject of the plaintiff's application dated 9 January 2007. It would seem to me to be a difficult proposition for a defendant to assert that there is inordinate delay in the progress of an action at the point in time where there is a live Chambers issue between the parties.
27 In these circumstances I am not persuaded that the delays are such that it could be said that to allow the plaintiff's case to proceed would inflict an unnecessary injustice on the defendant. This is particularly so when weighed against the injustice of the plaintiff of having its claim struck out and how close we are to getting the action entered for trial. I do, however, share the defendant's concern as to the manner in which the plaintiff's action has been pursued to date. However, going forward, the way to address the risk of future delays and injustices to the defendant is a combination of docket management and tight programming orders.
28 I would therefore dismiss the defendant's application to strike out the action as an abuse of process. For similar reasons I would also dismiss the application to strike out the plaintiff's claim for want of prosecution and I would also order that the case be removed from the inactive list.
(Page 9)
29 The defendant's third argument is that if the Court was minded to allow the claim to proceed, it should do so on the condition that the plaintiff provide security for costs. This application for security for costs is not made on the basis of Order 25 of the Rules of the Supreme Court. Rather, it is based on discretionary considerations. The defendant relied on the decision of Costa Carrera Nominees Pty Ltd & Anor v Chelsford Pty Ltd & Ors,unreported; SCt of WA; Library No 940229; 21 April 1994; Malcolm CJ, Kennedy and Scott JJ. In that decision, the then Chief Justice, Malcolm CJ (with whom the other members of the Court agreed) stated (at p 9):
"In my view there is a broad general power to order security for costs and such a power would include the exercise of the inherent jurisdiction of the Court to make such an order in order to deter or prevent an apprehended abuse of process in the course of the proceedings."
30 In dealing with an application based on these principles, the earlier comments I have made in relation to abuse of process more generally are of relevance. In addition to those comments there is no evidence as to the financial position of the plaintiff. From the court files it is apparent that costs orders have previously been made against the plaintiff in favour of the defendant. There is no evidence that any of these costs orders remain unpaid. Likewise there is no evidence of any outstanding judgments against the plaintiff as could be reasonably easily obtained from credit reference agencies.
31 It may well be that the power to order security for costs referred to in the Costa Carrera Nominees (supra) decision does not require a close consideration of the financial position of the plaintiff. However, it seems to me that in this case, given the evidential deficiencies which I have referred and given my general comments as regards abuse of process, it is not appropriate that I make an orders pursuant to this power.
32 The final argument raised by the defendant is that I should strike out the reply and defence to counterclaim and allow default judgment on the counterclaim. From the course of arguments before me and the affidavit evidence it is clear that there has been some confusion as to the way in which the pleadings have been filed in this action. This starts with the question of whether or not the minute of amended statement of claim filed 27 April 2006 should stand, or is able to stand, as the statement of claim in the action absent and order of the Court. The orders made by his Honour Judge Stavrianou on 20 April 2006 included the order:
(Page 10)
- "The plaintiff have leave to file and serve a minute of amended statement of claim within seven days of today's date and the defendant have liberty to apply to strike out within 21 days of service."
33 Counsel for the plaintiff submitted that it was his understanding of the intention of the parties and the Judge that if no application to strike out was made, the minute stand as the statement of claim. However, that is not the effect of the order. Be that as it may, the parties have proceeded on the basis that that minute stands as the statement of claim and that is something I can tidy up by orders in these proceedings.
34 In view of the confusion that has arisen and in view of the general comments I have already made about the action in the context of an abuse of process, I am not persuaded that I should strike out the reply and defence to counterclaim. Rather, it seems to me that we now have what looks like a completed set of pleadings in the action subject to any issues arising as to further and better particulars. Those pleadings ought to stand and the action be progressed through to trial as soon as is practicable.
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