Aslor Pty Ltd (in liq) v. Springmount Pty. Ltd; Crema (Vic) Pty Ltd v Aslor Pty Ltd (in liq)
[1998] VSC 199
•25 September 1998
SUPREME COURT OF VICTORIA
COMMERCIAL LIST Not Restricted
| F4681 | No. 2259 of 1996 |
| ASLOR PTY. LTD. (IN LIQ.) & ANOR. | Plaintiffs |
| v. | |
| SPRINGMOUNT PTY. LTD. & ORS. | Defendants |
| F4781 | No. 2045 of 1997 |
| CREMA (VIC.) PTY. LTD. | Plaintiff |
| v. | |
| ASLOR PTY. LTD. (IN LIQ.) & ORS. | Defendants |
---
| JUDGE: | CHERNOV, J. |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | 25 September 1998 |
| DATE OF JUDGMENT: | 25 September 1998 |
| CASE MAY BE CITED AS | Aslor Pty. Ltd. (in liq.) v. Springmount Pty. Ltd.; Crema (Vic.) Pty. Ltd. v. Aslor Pty. Ltd. (in liq.) |
| MEDIA NEUTRAL CITATION: | [1998] VSC 199 |
---
PRACTICE and PROCEDURE - Commercial List - Trial - Application to adjourn -
Discretion - The requirements of justice in all the circumstances.
---
| APPEARANCES | Counsel | Solicitors |
| For Aslor Pty. Ltd. (in liq.) & | Mr P.D. Corbett | Hall & Wilcox |
| Peter Damien McCluskey | ||
| For Crema (Vic.) Pty. Ltd. | Mr M.H. Whitten | Comlaw |
| For Mr G.R. Richards & | Mr M.T. Flynn | Poynters |
| G.R. Richards Pty. Ltd. |
HIS HONOUR:
Gary Raymond Richards (Richards) and his company, G.R. Richards Pty. Ltd., are the second and sixth defendants respectively in proceeding 2259 of 1996 (the Aslor proceeding) and the third and seventh defendants respectively in proceeding 2045 of 1997 (the Crema proceeding). Until approximately 15 May 1998, the solicitors on the record for Richards and his company, were Coltmans Price Brent (Coltmans), whose partner in charge who advised those parties, was Andrew John Chambers (Chambers).
The events giving rise to the complex issues that are the basis of these proceedings, go back at least to 1995 and arguably, to 1994. The Aslor proceeding was commenced by Peter Damien McCluskey (the liquidator) as liquidator of Aslor Pty. Ltd. (in liq.) (Aslor), against the company’s directors and their companies, including Richards and his company.
Speaking broadly, the contentions of the plaintiff in that case are that Aslor entered into a contract with Crema (Vic.) Pty. Ltd. (Crema), to build a complex of residential townhouse units (units) in Caulfield which was completed in about mid-1995. It is the allegation of the liquidator, that shortly after the completion of the construction of the units and just prior to the company being placed into voluntary administration, the directors of it, Frederick Roy Le Messurier, Anthony Thomas Gilbert (Gilbert), Ian Gordon Buckeridge (Buckeridge) and Richards, transferred a number of the units to themselves and/or to their related companies in consideration of the related companies taking over a portion of a bank debt owed by the company. The liquidator claims that the transfer was made for inadequate consideration, in breach of fiduciary duties, was uncommercial and was made to defraud creditors.
The claim by Crema in its proceeding, relates to allegations that the defendants, being Aslor and its directors and their related companies, made misrepresentations to it in August 1995, that Aslor had the capacity to pay a certain sum in settlement of
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
a building and arbitration proceeding between it and Crema, whereas at the time, the directors of Aslor knew or ought to have known that the company did not have the capacity to pay the settlement sum of $125,000. It is alleged by Crema that the representations were false and amounted to misleading and deceptive conduct.
On 18 April 1997, Mandie, J. set down the Aslor proceeding for hearing on 4 August 1997. In due course, by an order made on 12 December 1997, his Honour joined the two sets of proceedings and set them down for hearing together. At that stage, there was no determination as to the order in which the proceedings were to be heard.
On 15 May 1998, by service of notice of withdrawal of practitioner on the relevant parties, including Richards and his company, Coltmans gave notice that they would cease to act as from 15 May 1998. The notice served on Richards and his company nominated as the address for service, his accountants in Frankston. It seems that as a matter of probability, at the time that application was made, those accountants were located at the address referred to in the notice of withdrawal of practitioner and that they had acted as accountants for Richards and his company. I should add that the other parties for whom Coltmans acted in these proceedings and upon whom notice of withdrawal of practitioner was served, were Gilbert and his company, A.T. Gilbert Co. Pty. Ltd. and Buckeridge and his company, Billian Pty. Ltd.
On 15 May 1995, Chambers appeared before me and from his evidence, given by way of affidavit, it was plain that he had not notified Richards personally of his intention to withdraw as practitioner because at that time Richards was in Thailand and could not be contacted. Chambers' affidavit makes it clear that Richards was well aware that the trial was, at that time, scheduled to commence on 25 May 1998 and that he had told a law clerk at Coltmans on 4 May 1998, that he was leaving for Thailand on 6 May 1998 and would be away for approximately six months. It follows that Richards had no intention of being present at the hearing of the case which was then fixed for 25 May 1998.
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
Indeed, as his counsel today pointed out, no application was made by Richards to adjourn the case because of his then anticipated absence overseas. It seems to me that nothing has changed since then, except that the trial is to be held not on 25 May 1998, as was originally set down, but on 29 September 1998.
The third matter that was made clear in Chambers' affidavit, was that he had received no instructions from Richards (when Richards was in Australia), for the purpose of preparing a defence or preparing witness statements or any other step in the proceedings.
Chambers said in his affidavit that he met with, inter alia, Richards at his offices on 16 April 1998, and informed him that he would be unable to continue performing work on his behalf in the proceedings until he was provided with sufficient funds to cover the anticipated cost of preparing for the trial and conducting the defence. As I have said, he confirmed with Richards at that time, that the proceedings had been set down for trial on 25 May 1998 with an estimated duration of five to ten days; that Richards would be required to attend Court for the duration of the trial and that should his firm not receive instructions to defend the proceedings, it would withdraw as solicitor on the record.
It seems from the affidavit of Chambers, that Buckeridge, Richards and Gilbert in a sense, acted together as defendants in the proceedings. Chambers confirms that on 8 May 1998, he faxed Buckeridge a letter, which is addressed to the three defendants, advising them that unless he received instructions to appear by 12.00pm on 11 May 1998, he would have to take steps for the firm to be removed as solicitor on the record. He did not receive a response to that facsimile transmission.
On 15 May 1998, Coltmans was given leave to withdraw as solicitor on the record. On 21 May 1998, a hearing took place before me which was concerned with, inter alia, how the two proceedings should be heard. There was also an application to vacate the trial date based on the fact that one of the defendants had instructed new solicitors and those solicitors could not obtain the relevant file from the former
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
solicitors because of their claim for a lien; and also because the documentation had not been sufficiently prepared to ensure a proper and expeditious hearing of the case.
On the following day, 22 May 1998, new directions were given for the trial of the proceedings to be fixed for hearing on 29 September 1998 (limited to the question of liability). At that time, it was made clear that there would be no further adjournments given the history of the case and the apparent failure by at least some of the defendants, to instruct their solicitors and to prepare defences. On one or possibly both of those days, Buckeridge appeared in Court and the matter was communicated to him.
The plaintiffs proceeded to prepare their respective cases and no doubt expended significant amounts of money in preparing the relevant documentation, such as the Court Book that had to be provided to the relevant parties. On 3 June 1998, the plaintiffs in the Aslor proceeding served on Richards and his company, at the Frankston address to which I have referred, authenticated copies of my order of 22 May 1998, with accompanying letters. On 8 July 1998, four volumes of the Court Book were sent by the plaintiffs by prepaid post to the Richards defendants at the Frankston address. On 13 July 1998, a solicitor in the employ of the plaintiffs' solicitors was telephoned by a person from the firm of the accountants to whom I have referred, who confirmed that the company had received the four volumes of the Court Book. That person also confirmed that he had not heard from Richards for over a month and that he was overseas.
The person from the plaintiffs' solicitor advised the accountant that his firm's address was the address for service on record in the proceedings, so far as Richards and his company were concerned, and that he should bring this fact to the attention of Richards, particularly the fact that the proceeding was now scheduled for 29 September 1998.
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
In late July, witness statements were served on the accountants and on 25 August 1998, the plaintiffs' solicitor was contacted by Gordon Johns (Johns) of Poynters Lawyers (Poynters). Poynters advised the solicitor for the plaintiffs that he had received instructions to act on behalf of Richards and his company and had also received the four volumes of the Court Book.
He confirmed that Richards was overseas and that he had not had an opportunity to speak with him personally. From the evidence before me, it was not clear who it was that gave Poynters instructions to act for Richards and his company. I will return to that later.
During the conversation between the plaintiffs' solicitor and Johns, the latter was made aware, if he was not already aware of it by then, that Richards should have filed witness statements, but had not done so. On 18 September 1998, not having heard anything further from Johns, the plaintiffs' solicitor telephoned him. Johns advised him that he was still in the process of determining whether or not his firm was to act on behalf of Richards and his company and/or whether it would be the solicitor on the record.
Notwithstanding these developments, the plaintiffs' solicitor served on Richards and his company on about 21 September 1998, the plaintiffs' submissions in the proceedings in accordance with the directions made by me to that effect, by posting the material to the accountancy firm to which I have referred.
On 22 September 1998, the plaintiffs' solicitor received a telephone call from Johns in which he confirmed that his firm was acting for Richards and his company and that he would be filing a notice to that effect with the Court. Johns confirmed that Richards was overseas, apparently in New Guinea, and would not be returning to Australia for the trial which he acknowledged was to commence on 29 September 1998 and that he was in the process of engaging counsel to act on behalf of his clients.
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
Mr Flynn, who appeared for Richards and his company, told me that his instructions were that Poynters was only instructed to apply for the adjournment and had no instructions to appear at trial. I should add that on the evidence of the plaintiffs' solicitor, during the conversations with Johns on 25 August 1998, 18 September 1998 and 22 September 1998, he did not inform the plaintiffs' solicitor that he intended to seek an adjournment of the trial.
On 24 September 1998, Poynters filed in each of the proceedings, a summons and an affidavit in support sworn by Johns, seeking an adjournment of the trial. In his affidavit, Johns deposes that he had been informed by his principal that he was contacted in mid-August 1998 by a Mr Allaway (Allaway), who is apparently Richards' son-in-law, and it was he who asked him to act on behalf of Richards and his company in the proceedings. He said that Richards was on a yacht off Borneo and was therefore not able to communicate directly with him. Johns’ principal told Allaway that Poynters would not act for Richards until money was paid into the firm's account. Johns goes on to say that on 24 August 1998, his firm received the four volumes of the Court Book, but on that date, neither Johns' principal nor he was aware that the matter had been set down for hearing on 29 September 1998. It seems, however, common ground that Poynters knew in late-August that the hearing date was 29 September 1998.
Johns then says that he had difficulty contacting Richards but in or about mid-September 1998, one of his various attempts proved successful. He does not state in his affidavit when that occurred; nor does he say whether he discussed with Richards the question of defending the proceedings or what his instructions were in relation to it. The only evidence which Johns puts before the Court is that he was told by Richards that he had reached him on a rare occasion when he was in telecommunications range.
Johns apparently advised Richards that the proceedings were set down for trial on 29 September 1998. Johns does not say what Richards said in reply, other than to say
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
that he sounded surprised. Johns then says that he was instructed to apply for an
adjournment.
Johns also says in his affidavit, that on 23 September 1998, he spoke to a person who was apparently Richards' daughter, who told him that Richards would be returning to Australia in approximately two weeks. Johns claims that Richards is a key witness in the proceedings but does not say why that is so. He also says that it is essential for Richards to be present at trial in order to give instructions about the conduct of his defence and that of his company. That is saying no more than the obvious - that without instructions Poynters would not be able to present the case, but Johns does not descend to any particularity as to how the case is likely to be defended. So, on that skimpy material, an adjournment of these proceedings is sought. No acknowledgement is made of the cost and inconvenience that such an adjournment would impose on the other parties, on the Court, and on subsequent litigants waiting to be heard.
There is no evidence before the Court of any communication or inability to communicate as between the accountants and Richards and how it is that Allaway took it upon himself to instruct Poynters not only to seek an adjournment, but to defend the case on behalf of Richards and his company. Presumably, he had spoken to Richards, but none of this is revealed.
The principles applicable to the granting of an adjournment of this nature are fairly well-known. There is no need to repeat them here. It is trite that the Court has a discretion in the matter which must, of course, be exercised judicially and with regard to the requirements of the justice of the situation. It is essentially a question of doing justice between the relevant parties who are often described, albeit in commercial terms, as the stakeholders, namely, the applicant who seeks the adjournment, the respondents to that application, the other litigants in the case who may or may not be respondents, the litigants waiting to be heard and perhaps more generally, the public interest in seeing that the Courts dispose of cases expeditiously, but in accordance with law. I refer to the State of Queensland v. J.L. Holdings Pty. Ltd.
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
(1997) 141 A.L.R. 353, particularly 367-370; GSA Industries Pty. Ltd. v. NT Gas Ltd. (1990) 24 N.S.W.L.R. 710, 714-716; Boyle v. Ford Motor Co. Ltd. (1992) 1 W.L.R. 476; Bomanite Pty. Ltd. v. Slatex Corporation Australia Pty. Ltd. (1991) 32 F.C.R. 379, particularly 391-393; and Ketteman v. Hansel Properties Ltd. [1987] A.C. 189, 220.
Here the plaintiffs and others have been preparing for trial for some time at significant expense. As I have said, the plaintiffs have already served all or nearly all the relevant documents that they are required to serve, on the applicants. The case has already been refixed at the request of other litigants. There is no satisfactory evidence before the Court that Richards has a genuine desire to be present at this trial. In particular, there is nothing that satisfies me that Richards has adopted a different position in respect of the present hearing date to the one that he took up last May.
One of the plaintiffs is a liquidator who has to progress the liquidation as quickly as possible. On the evidence, there is no certainty that Richards would pay or would be able to pay the large amount of costs that would be thrown away if the application for adjournment was allowed. To adjourn the case now would create enormous disruption to the other parties, particularly the plaintiffs, and those who have been preparing the hearing. It would also disrupt this List which means that parties waiting to have their cases heard and whose cases have been fixed, will be, at best, inconvenienced. None of this could be properly compensated by costs, even if Richards were to pay for them.
In the circumstances, I refuse the application.
Aslor Pty. Ltd. (in liq) v. Springmount Pty. Ltd.;
0
0
0