Attic Ladders Pty Ltd v Sensis Pty Ltd - [2004] FMCA 48

FEDERAL MAGISTRATES COURT OF AUSTRALIA

ATTIC LADDERS PTY LTD v SENSIS PTY LTD

[2004] FMCA 48

TRADE PRACTICES – PRACTICE AND PROCEDURE – Application for adjournment – costs.

Trade Practices Act 1974

Smith and Another v Gannawarra Shire Council and Another (2002) 4 VR 344

Applicant:

ATTIC LADDERS PTY LTD
(ACN 002 738 472)

Respondent:

SENSIS PTY LTD (ACN 007 423 912)

File No:

MZ 172 of 2003

Delivered on:

28 January 2004

Delivered at:

Melbourne

Hearing Date:

28 January 2004

Judgment of:

McInnis FM

REPRESENTATION

Counsel for the Applicant:

Mr. S. Smith

Solicitors for the Applicant:

McCarthy & Associates

Counsel for the Respondent:

Mr. J. Tsalanidis

Solicitors for the Respondent:

Mallesons Stephen Jaques

ORDERS

The Application is fixed for hearing on 9 August 2004 at 10.00 am with a hearing estimate of three days with the Application being listed in the reserve list of cases docketed before this court to be fixed on an earlier date upon 14 days written notice to the parties.
The Application be fixed for directions at 9.30 am on 11 March 2004 with any outstanding issues, including discovery and inspection, to be dealt with on that day.
Any Applications for further discovery or inspection or other outstanding issues between the parties shall be filed and served no later than seven days prior to 11 March 2004.
The Respondent's costs of and incidental to the Application for adjournment and costs thrown away by reason of the adjournment be paid by the Applicant in accordance with Schedule 1 of the Federal Magistrates Court Rules to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MZ 172 of 2003

ATTIC LADDERS PTY LTD (ACN 002 738 472)

Applicant

and

SENSIS PTY LTD (ACN 007 423 912)

Respondent

REASONS FOR JUDGMENT

(Revised from transcript)

This is an Application whereby the Applicant makes a claim arising out of agreements for the publication of certain entries in the Yellow Pages, alleged breaches of provisions of the Trade Practices Act and other matters referred to in the Statement of Claim filed 21 February 2003. The Respondent has made Application to adjourn the proceedings and essentially does so on the basis of the late filing of an expert report prepared on behalf of the Applicant by William John Neill and filed on 22 January 2004, having been served upon the Respondent on the same date.
The author of that expert report had prepared two other witness expert statements, the first being a statement filed 26 May 2003 and the second on 11 September 2003.
It is sufficient for the present purposes to note that in the second of those reports prepared by the expert, an assessment was made under the heading ‘Preliminary Conclusions’ dealing with what is described as the loss to date of the Applicant. The total of the loss to date in that statement is $103,534.00. In the most recent report the total loss is said to be $285,485.00.
It is noteworthy that prior to the quantification of the loss in the manner I have described in those reports of the expert the prayer for relief in the statement of claim had referred to the damages to be assessed not exceeding the sum of $200,000. In the last report from Mr. Neill it is clear on a proper reading of that report that there is a change not simply in the quantum but also in the nature and extent of the claim and the methodology adopted to assess the claim.
This court made orders in this matter on 4 April 2003. Those orders, amongst other things, fixed the matter for final hearing on

24 November 2003. Orders were then made in relation to the filing and serving of statements, including expert reports. By orders made by consent on 20 June 2003 the orders of the court made on 4 April 2003 were varied. Significantly, the time limits for the parties to file and serve written statements were extended. The final hearing of

24 November 2003 was vacated, and the matter then fixed for final hearing on 28 January 2004 with a hearing estimate of three days.
In my view, it is significant to note that on both occasions when the court made orders liberty to apply was granted to the parties in relation to any matters arising out of the orders. The Respondent in support of the Application for adjournment has relied upon two affidavits, the first an affidavit sworn by Gillian Ann Yee Fei Wong sworn 27 January 2004, and the second an affidavit of Brendan Lawrence Reilly sworn

27 January 2004.
A proper reading of the second of those affidavits reveals a chronology of events, which it is said for and on behalf of the Respondent that it is justified in seeking an adjournment of this Application. It is perhaps useful to start with at least one of those items of correspondence being a letter dated 14 November 2003 from the solicitors for the Applicant addressed to the solicitors for the Respondent. In that letter reference is made to the orders by consent on 20 June 2003. Specific reference is made to the further report of the expert, Mr. Neill. The second paragraph of the letter reads:
“The orders made by consent on 20 June 2003 were agreed to in anticipation that our client's report would be capable of properly assessing the Applicant's loss and damage. However, the essence of the Respondent's report provided is that the Applicant's report remains in a preliminary form and a final report may not be produced until all figures are complete. Our client would be in a position to fully quantify its losses and provide a completed report in the third week of January 2004.
…
We confirm that the trial date is fixed on 28 January 2003 and we consider that this does not provide your client sufficient time to engage an expert to respond to our client's report nor to appropriately prepare for the hearing.”
The letter goes on to refer to consent to extending the relevant dates and it seemed clear from that letter that at that time, at least the Applicant's advisers were aware that as a result of the late serving of the expert report, the Respondent would not be in a position to submit a final report to be relied upon by way of reply in time for the hearing. In the last paragraph of their letter the Applicant's solicitors say:
“Should we not receive your consent and/or advices within 14 days of the date of receipt of this letter, we will make an application to the Court for directions and we reserve the right to rely upon and produce this letter to the Court on the question of costs.”
It would seem that a further item of correspondence dated 2 December 2003 was forwarded by the Applicant’s solicitors to the Respondent’s solicitors. It is not disputed that in fact no Application was made by the Applicant’s solicitors to the court, despite the fact that the court had granted liberty to apply to the parties in relation to any matters arising out of the court's orders.
In any event, the Respondent by letter dated 3 December 2003 to the solicitors for the Applicant referred to the letters of the Applicant’s solicitors dated 14 November and 2 December 2003, and advises that the Respondent does not consent to the proposed orders and would not agree to further vacation of the trial date. The basis upon which the Respondent reached that conclusion is set out in the letters, and the chronology to which I have partly referred is repeated in that correspondence.
It seems clear to me that what has then occurred is that the expert report, that is, the latest report of Mr. Neill, was simply filed and served on 22 January 2004.
It has been argued on behalf of the Applicant that in the circumstances, it did all that was reasonable, I infer, by at least alerting the Respondent to the prospect of a report and indeed bringing to the attention of the Respondent that the late service of that report would mean that the Respondent would be unlikely to be in a position to reply in time for the hearing. The fact remains, however, that neither party have made Application to the court to adjust the time frame.
In considering the issue of an Application for adjournment, I refer to what was said by the then president of the Victorian Supreme Court of Appeal in the matter of Smith and Another v Gannawarra Shire Council and Another (2002) 4 VR 344. The president said at page 352 the following:
“In this day and age when the courts are under pressure to deal with cases before them in an expeditious fashion and where, accordingly, case management has become a significant aspect of the curial processes, the administration of justice still requires that the courts ensure, so far as practicable, that justice be administered evenhandedly so that each party to a dispute is in a position, within the bounds of reason, to present his or her case to the court in its best light and in an orderly fashion. As Dawson, Gaudron and McHugh JJ pointed out in Queensland v J L Holdings Pty Ltd, in matters like this “Justice is the paramount consideration”. In other words, courts should be astute to ensure that expediency is not permitted to usurp justice by refusing to grant an adjournment at the instance of a party in circumstances which will significantly interfere with the ability of that party to present his or her case effectively…”
Applying the principles set out in that decision to the present Application, it is my view that the late filing and service of the report from the expert, Mr. Neill, has resulted in a situation where I am satisfied that it would not be just to require the Respondent to continue with this matter.
Ironically, it seems to me, that the observations made by the solicitors for the Applicant in the letter dated 14 November 2003 remain correct. It is still correct to say that the late serving of that report would mean that the Respondent would not have adequate time or opportunity to consider the contents of that report in a timely fashion, which would enable a sensible reply in readiness for this trial.
It is clear from the material before me that there are also outstanding issues between the parties in relation to discovery and inspection. However, I am satisfied that justifiably the substantive and primary concern of the Respondent is the late filing and serving of the report.

It is clear to me that the report does contain new matters, which require attention, and significantly increases the quantum now sought to be claimed by the Applicant. Those matters combined make it essential that the Respondent have adequate opportunity, in my view, in the interests of justice to properly prepare the case and reply to the most recent report of Mr. Neill. For those reasons, it is appropriate the adjournment be granted.
It has been submitted by counsel for the Applicant that in the event the court were to grant the adjournment that the Respondent should pay the Applicant's costs of and incidental to the granting of the adjournment. In support of that Application for costs, counsel for the Applicant has submitted to the court that the correspondence clearly brings to the attention of the Respondent the desire of the Applicant to rely upon the most recent report, and further brings to the notice of the Respondent that there is a likelihood that upon filing and serving of the report, the matter will not be able to proceed on the scheduled hearing date.
It is further submitted, as I understand it, that in a sense the exchange of correspondence, only part of which I refer to in this decision, had effectively lulled the Applicant into a false sense of security whereby the Applicant had perhaps understandably, though wrongly, assumed that by proceeding to file and serve their report at a late stage the matter could still proceed. It was also noted that the suggestion of vacating the hearing date had been strongly opposed throughout.
In response, counsel for the Respondent has submitted that the costs of the Respondent should be paid by the Applicant and reference and reliance has been placed upon the late serving of the report, and otherwise reliance has been placed upon the correspondence to which I have referred. It is noted that no Application has been made to vacate the trial date.
In my view, in considering the issue of costs the court has a very broad discretion and although normally an Application for an adjournment, if granted, may result in an order of a kind where costs follow the event, it is incumbent upon the court to consider all matters that are relevant to the exercise of the discretion.
On a proper reading of the correspondence there was a clearly formed view by the Applicant’s solicitors as early as November 2003 that the hearing date would need to be vacated upon the filing and serving of the final report. Whilst it is true to say that the correspondence thereafter from the Respondent opposed any Application to vacate the hearing date, it is equally clear that the invitation to consent to an order of that kind was not met with acceptance but rather a strong objection. Having been met with that objection, and having foreshadowed an Application being made to the court within 14 days of receipt of the letter dated 14 November 2003, it seems clear to me that in all the circumstances the proper course for the Applicant to adopt would have been to bring the matter before the court and make the appropriate Application. This is so even after the follow-up letter of 2 December 2003 which ultimately generated the response from the Respondent’s solicitor and the correspondence dated 3 December 2003.
Whilst there are duties placed upon both parties in matters of this kind, it seems to me that in circumstances where the substantive expert report is to be filed out of time by the Applicant, and where the Applicant seeks to rely upon that report, which, as I say, significantly increases the quantum and raises other issues, it is incumbent upon the Applicant to bring the matter before the court, certainly at a much earlier stage, and indeed as noted there is no Application currently before the court by the Applicant to vacate the hearing date. Instead it is the Respondent supported by the affidavit material to which I have referred which has made the Application this day.
In my view, in the circumstances it is appropriate the adjournment be granted and it is further appropriate that the costs of and incidental to the adjournment of the Respondent be paid by the Applicant.

I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of McInnis FM

Associate:

Date: 28 January 2004