Aldous v State of New South Wales

[2014] NSWCA 280

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Aldous v State of New South Wales [2014] NSWCA 280

Hearing dates:

13 August 2014

Decision date:

13 August 2014

Before:

Barrett JA at [1], Emmett JA at [24], Tobias AJA at [25]

Decision:

1. Appeal allowed.

2. Set aside orders made by the District Court at Parramatta on 6 February 2013 and entered on 7 February 2013 and in lieu thereof order as follows:

(1) Order pursuant to rule 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) that the defence be stuck out and that the defendant have leave to replead.

(2) Order that the defendant pay the plaintiff's costs of the motion.

3. No order for costs in this Court.

4. That the respondent pay the appellant's court filing fees in this Court.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords:

PROCEDURE - pleading - plaintiff sought an order striking out an unrepresented defendant's defence - defence drawn by the defendant himself - being of the opinion that the defence disclosed no ground of defence, the primary judge ordered summary judgment for the plaintiff - no application for summary judgment before the court - no intimation to the defendant that summary judgment against him was a possible outcome - breach of procedural fairness and natural justice - on appeal, judgment set aside and defence struck out but with leave to replead

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 73
Contracts Review Act 1980 (NSW)
Uniform Civil Procedure Rules 2005 (NSW), rules 7.36, 13.1, 14.28

Category:

Principal judgment

Parties:

Adrian John Aldous (Appellant)
State of New South Wales (Respondent)

Representation:

Counsel:
Appellant in person
J J Hyde (Respondent - submitting appearance)
D A McLure/K S Anderson (Amici Curiae)
Solicitors:
Appellant self-represented
De Mestre and Company (Respondent)

File Number(s):

CA 2013/199575

 Decision under appeal 

Date of Decision:

2013-02-06 00:00:00

Before:

Delaney DCJ

File Number(s):

DC 2010/99473

Judgment

1. BARRETT JA: The appellant is a former member of the New South Wales police service. After he ceased to be a member of that service, he entered into a deed with the Commissioner of Police, acting for and on behalf of the State, by which he promised to make certain payments in certain events related to his receipt of partial and permanent disability benefit.

1. Several payments were later made by the appellant to the State. Being of the opinion that the appellant had not fully performed his obligations under the deed, however, the State sued him in the District Court claiming $334,957.88 and interest.

1. The appellant filed a defence. He did not have the benefit of legal assistance and prepared the document himself.

1. The State filed a notice of motion dated 23 November 2012 seeking an order under rule 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) that the defence be struck out as embarrassing.

1. On 6 February 2013, Judge Delaney, sitting in the District Court at Parramatta, held, in a reserved judgment, that the defence filed by the appellant "raises no defence to the plaintiff's entitlement under the deed" and proceeded to consider the question "whether the defendant should be permitted to re-plead or if there should be judgment for the plaintiff without a hearing on the merits". Reference was made to "whether an order ought to be made pursuant to r 13.1 of the UCPR". His Honour's conclusion was that "the defence is untenable" and "[t]he defendant has no defence to the claim under the relevant deed". The judge then said:

"The defence is struck out and the plaintiff may now seek judgment with interest and costs."

1. The reasons for judgment leave one with the impression that the primary judge made orders under both rule 14.28 and rule 13.1, that is, an order that the defence be struck out and a subsequent order that there be summary judgment for the State as plaintiff. The orders as entered, however, are:

"1. Judgment in favour of the Plaintiff against the Defendant in the amount of $377,905.81 inclusive of interest.

2. The Defendant pay the Plaintiff's costs as agreed or assessed."

1. The appellant wishes to see the orders made by the Judge Delaney set aside. He has obtained a grant of leave to appeal limited to the circumstance that he was not granted leave to re-plead. That being so, the real issue for determination on appeal is whether the money judgment in favour of the State (and the related costs order) should be set aside and the appellant should be let back in to defend the District Court action by means of such reformulated defence as he chooses to present. The question of reinstating the defence in the form in which it was originally filed is not before us.

1. The appellant has appeared without legal representation today, as he did in the District Court. In relation to the appeal, the State filed a submitting appearance save as to costs but Mr Hyde of counsel appeared on its behalf to deal briefly with one matter of explanation to which I shall come. It was in those circumstances that Mr David McLure and Mr Kim Anderson of counsel were appointed to act as amici curiae. They have made submissions referring to certain aspects of the procedural history of the matter that are of particular importance.

1. The State's notice of motion dated 23 November 2012 sought only an order under rule 14.28 striking out the defence. At the hearing of the motion on 3 December 2012, however, a submission was made on behalf of the State that it should be allowed to apply for judgment for the balance said to be due under the deed. There was no application to amend the notice of motion to add a claim for summary judgment under rule 13.1 and counsel for the State has conceded, by way of explanation before this Court, that no question under rule 13.1 was before the District Court. Also, there was no affidavit of a responsible officer of that State, as required by rule 13.1(b), testifying to a belief that the appellant had no defence. There was accordingly no material before the judge from which he could see that the State, as plaintiff, held the belief that the claim was utterly indefensible. Crucially, there was no indication to the appellant that the judge would be entertaining the proposition that he be shut out entirely and subjected to summary judgment. All these matters are highlighted in the submissions we received from Mr McLure and Mr Anderson.

1. The submissions also point out that, after publishing his judgment that concluded by saying that the defence was struck out and the plaintiff could seek judgment with interest and costs, the judge said:

". . . you are excused to read that and just work out the figures and tell Mr Aldous what they are. Thank you. I propose to enter judgment in your favour in the amount, plus interest, as soon as you tell me what it is."

1. It is, to my mind, plain that the appellant was denied a fair opportunity to understand and deal with the propositions that the judge ultimately accepted and that saw the litigation summarily terminated in the State's favour. The hearing was appointed to deal with the State's contention, advanced by its notice of motion, that the defence should be struck out. Had that proposition been determined adversely to the appellant, the proceedings would not have been brought to an end and he could have sought leave to replead by means of a revised defence. The appellant was not on notice that the outcome of the hearing of the notice of motion could be a judgment against him with no further opportunity for him to defend himself.

1. There was, in that way, a clear denial of procedural fairness and natural justice. The possibility that the proceedings might be brought to a conclusion by way of judgment for the State as plaintiff, without any hearing on the merits or any need for the State to prove any elements of its case, was not raised until the hearing of the notice of motion and then only indirectly and in passing by way of brief reference by the State's solicitor. There was no intimation to the appellant that the judge had it in mind to move outside the boundaries of the claim in the notice of motion. The appellant had no opportunity whatsoever to anticipate and deal with a proposition that spelled the end of his ability to defend himself.

1. I should add that there was, in a theoretical sense, before the court on 3 December 2012 a separate motion filed by the State seeking judgment under s 73 of the Civil Procedure Act 2005 (NSW). That matter had received attention on an earlier hearing day, 31 October 2012, and the application had been stood over to 3 December 2012. But it is clear that the State's s 73 application and the questions of compromise or settlement that, of its nature, such an application entails were not addressed in the course of the hearing on the latter day. The order of dismissal made on 6 February 2013 following the hearing on 3 December 2012 cannot be supported by reference to the s 73 application, and that application can only be regarded as never having been determined.

1. The judgment and orders of 6 February 2013 in favour of the State were the product of a process infected by serious procedural unfairness. The orders must therefore be set aside.

1. For the reason I have earlier stated, the other matter before this Court is whether the appellant should have leave to replead.

1. It is necessary to look at the defence as originally prepared by the appellant himself and to identify any matters in it that appear to raise issues that may fairly be regarded as indicating some reasonably arguable defence to the claims made by the State by reference to the deed.

1. In his defence document, the appellant concentrates principally on the state of his health at the time he signed the deed on 25 July 2007, describing himself as "a vulnerable person" whose illness was known to the police service. The relevant disorder is said to involve his being "mentally unwell", being under the care of various medical specialists, taking various forms of medication, consuming large quantities of alcohol, being "severely intoxicated" and attempting suicide. Indeed, the appellant says that he signed the deed only eight days after he was discharged from a mental health facility and that medical reports about his condition in the lead up to signing were in the possession of the police service and indicated impairment of understanding.

1. These matters, if appropriately pleaded and particularised, might amount to a reasonably arguable defence of non est factum or under the Contracts Review Act 1980 (NSW) or perhaps otherwise. The appellant should be afforded a chance to articulate any such reasonably arguable defences.

1. The appellant has put forward a form of cross-claim, also drawn by him without legal assistance. The substance of that document seems to be an allegation that the State, by its conduct towards him at the time of his leaving the police service, came to owe him a duty of care in negligence. He says that he has a cross-claim against the State accordingly. It may be that he also has a cross-claim in relation to his consent to receipt of payments in 2008 and 2009.

1. The position the State appears to take is that, even if any negligence claim has substance (which it does not admit), there is no need for it to be litigated with the State's claim under the deed; and that the matter is therefore irrelevant to the question whether leave to replead should be granted. To my mind, the matter is not that simple; and potential overlap between factual matters relevant to the defences as such and to any such counter-claim might well make it desirable that they be litigated together.

1. As things currently stand, it cannot be said that the appellant obviously has no plausible defence. He should be allowed to attempt to articulate defences.

1. In my opinion, this Court should make orders as follows:

1 Appeal allowed.

2. Set aside orders made by the District Court at Parramatta on 6 February 2013 and entered on 7 February 2013 and in lieu thereof order as follows:

(1) Order pursuant to rule 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) that the defence be stuck out and that the defendant have leave to replead.

(2) Order that the defendant pay the plaintiff's costs of the motion.

3. No order for costs in this Court.

4. That the respondent pay the appellant's court filing fees in this Court.

1. I would add that this is a matter in which it would be highly beneficial and desirable for a referral for pro bono legal assistance to be made under rule 7.36 or for the Law Society or Bar Association to give close consideration to the possibility of pro bono assistance being made available to the appellant for the District Court proceedings.

1. EMMETT JA: I agree, for the reasons given by Barrett JA, that the judgment in favour of the State and the associated costs order were obtained by a process infected by serious procedural unfairness. They must therefore be set aside. I also agree that on the material before us it cannot be said the appellant has no conceivable defence. He should therefore be allowed to attempt to articulate a defence and file a cross-claim if appropriate. I agree with the orders proposed by Barrett JA and I also endorse his comments about the provision of pro bono assistance.

1. TOBIAS AJA: I also agree with the orders proposed by the presiding judge for the reasons he has expressed, as well as with the additional comments of Emmett JA.

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Decision last updated: 20 August 2014