BQ & HM Doe Pty Ltd v National Australia Bank

[1999] SASC 124

B Q & H M DOE PTY LTD V NATIONAL AUSTRALIA BANK

LANDER J. This is an appeal by a plaintiff from orders of a Master of this Court made on 28 October 1998 wherein the Master ordered that the plaintiff’s action against the defendant be struck out for want of prosecution and that the plaintiff pay the defendant’s costs to be agreed or taxed.
There are a number of grounds of appeal raised to which I shall refer in detail a little later.
The defendant argued that this appeal was incompetent because the order appealed against is an interlocutory order and the appellant required leave to appeal pursuant to s50(2) of the Supreme Court Act.
In my opinion, the defendant’s argument is misconceived.
Section 50(2) of the Supreme Court Act provides:
“(2).. Subject to the rules of court, an appeal shall lie to a judge against a judgment, order, direction or decision of a master.”
Rule 106.05 of the Supreme Court Rules provides for appeals against decisions of Masters. That rule provides:
“(1).. Subject to subrule (2) below an appeal from any assessment or award of damages or any other final finding, decision, direction, award or judgment, arrived at, made, given, directed or entered on the trial or hearing of any proceedings or of any question or issues by a Master lies to the Full Court and is to be governed by Rule 95.
(2)Any appeal from a Master:
(a)in relation to an order made under the Real Property Act 1885 or under Rule 60;
(b)from an order, decision or judgment to which subrule (1) does not apply;
(c)where the parties consent to the appeal being dealt with by a single Judge is to be to a single Judge and is to be governed by Rule 97.
(3)... An appeal under subrule (2) is to be instituted within 7 days of the order, decision or judgment appealed from.”
It can be seen from a reading of r106.05 that those matters which come within r106.05(1) must go to the Full Court for determination whilst any other matter including the matters in r106.05(2)(a) and (2)(c) go to a single judge.
In neither case, in my opinion, is leave required. The matter to be determined on an appeal from a Master is whether the subject matter comes within either subrule (1) or subrule (2) of r106.05. Once it can be determined which of the rules governs the subject matter of the appeal then the appeal goes as of right to the appropriate court.
The author of Civil Procedure South Australia, Butterworths, writes at page 10,947:
“Appeals to single judges. Appeals from masters on interlocutory orders lie to a single judge under R 106.05(2)(b) and s 50(4) of the Supreme Court Act, and leave is required under s 50(3) of the Supreme Court Act: Collins v Emacord Autos Pty Ltd (Full Court (SA), Jud No S6418, 3 November 1997, unreported).”
In my opinion, that statement is incorrect. The case cited by the learned author does not stand for the proposition stated. In that case the Master was concerned with an application for security for costs. The Master dismissed the application. The defendant appealed to a single Judge who allowed the appeal and ordered that the plaintiff provide security for costs. The plaintiff, who was unrepresented, purported to appeal as of right from the decision of the single Judge. The plaintiff claimed that the appeal from the Master to the single Judge had been irregular and that the original appeal should have gone straight to the Full Court. In that case I said (Doyle CJ and Bleby J agreeing) that the defendant’s appeal to a single Judge was the appropriate procedure; as provided by r106.05(2). I concluded that the plaintiff’s appeal from the single Judge to the Full Court was incompetent because an appeal from a single Judge to the Full Court from any interlocutory order did not lie without leave. (s50(1)(3) Supreme Court Act). That case does not stand for the proposition that leave is required from an appeal from a master either to the Full Court under r106.05(1) or to a single Judge under r106.05(2).
The plaintiff commenced these proceedings against the defendant on 13 February 1997. The proceedings were commenced by summons with the Statement of Claim annexed. In that Statement of Claim the plaintiff claimed that the defendant was liable to the plaintiff in damages in respect of three causes of actions, negligence, misrepresentation and pursuant to s52 of the Trade Practices Act. The claim for damages was identified precisely in the sum of $942,700.
The defendant entered its defence on 20 March 1997 and in that defence pleaded that the Statement of Claim did not disclose a cause of action in negligence because there was no allegation that the defendant owed the plaintiff a duty of care or acted in breach of that duty of care.
In relation to the cause of action in misrepresentation it claimed that the Statement of Claim disclosed no cause of action in that no facts were alleged sufficient to show that any of the alleged representations in the Statement of Claim were false.
In relation to the third cause of action pleaded against it, it merely claimed that it was not in breach of s52 of the Trade Practices Act.
Whilst there were positive pleas in relation to the failure to plead a cause of action in negligence and misrepresentation, the defence otherwise contained no positive pleas. It merely consisted of denials or non admissions.
Pursuant to leave given by Judge Bowen Pain on 23 April 1997, on 2 May 1997, the plaintiff filed an amended Statement of Claim. That amended Statement of Claim sought to address the pleas by the defendant that the previous Statement of Claim did not disclose causes of action in negligence and misrepresentation. On 8 July 1997, the plaintiff filed its List of Documents.
The defendant was under an obligation pursuant to r58.01 to file and serve its List of Documents twenty-one days after the filing of its defence on 20 March 1997. It did not do so and no explanation has been given for its failure.
Later, apparently, there was an agreement between the parties which allowed the defendant to delay filing its List of Documents. That agreement was not sanctioned by the Court.
On 12 September 1997, the defendant made an application for security for costs. Exhibit ASV7 to the affidavit of Alicia Susanne Videon shows that on 23 July 1997 the parties agreed that the defendant did not need to file its list of the documents for the present time.
In any event, the defendant did not file its List of Documents until 29 October 1997.
In answer to the application for security for costs, a director of the plaintiff filed an affidavit disclosing the assets of the plaintiff and his and his wife’s assets. The parties were unable to agree between themselves whether or not security was appropriate or, apparently, the terms of that security. The question of security for costs was disputed until finally it was settled on 3 March 1998. At that time the plaintiff agreed to provide for security for costs in the sum of $50,000, and an order was made accordingly.
It appears clear, from the file, that between September and March 1998 the parties were mainly concerned with the question of security for costs because apart from the filing of the List of Documents by the defendant on 20 October 1997, no other activity took place.
A pre trial conference was set for 19 May 1998. On that day, the defendant filed a further affidavit again sworn by Alicia Videon in which she referred to a previous ‘without prejudice’ conference. At that conference she said that the plaintiff disclosed it intended to amend its Statement of Claim. In any event, when the matter was heard on 19 May 1998, the defendant advised Judge Burley that it would be likely that it would seek further and better discovery from the plaintiff. No order was made in that respect. On the defendant’s application an order was made giving the defendant leave to file and serve a further defence by 2 June 1998. The orders made on that day were:
“ 1. Leave to the defendant to file and serve a defence by 2 June 1998.
2.Leave to the defendant to obtain and disclose expert reports by 16.6.98.
3.That the defendant’s foreshadowed application for further and better discovery be filed and served by 9 June 1998.
4.Costs in the cause. The directions hearing adjourned to 25 June 1998.”
The defendant did not file its defence within the time provided for in the order giving leave but filed its defence on 25 June 1998. The defence carried with it the endorsement “Filed pursuant to the order of Burley J made on 19 May 1998”. That endorsement is not correct. The defence was not filed within the time prescribed by Judge Burley on 19 May 1998. The time within which the defendant was given to file its defence has never been extended although no point has apparently been taken by the plaintiff in respect of that defence.
The amendments to the defence were extensive. For the first time the defence complied with the provisions of r46.12 and in particular r46.12(4).
On the same day Messrs Phillips Fox, Solicitors, filed a notice that they were acting for the plaintiff in lieu of Deller and Co, who had acted for the plaintiff to that point of time.
The Court file shows that the matter came before Judge Burley on 25 June 1998. The following endorsement appears on the file:
“The plaintiff has only just changed solicitor and an adjournment is sought because amendments to the pleadings are contemplated. The matter will be reviewed generally on the next occasion and the plaintiff’s new solicitors are to make as much progress as possible over the adjournment. Their proposed Statement of Claim should be formulated and provided to the other side within six weeks from today.”
The matter was adjourned to 3 September 1998.
The matter came on before Judge Bowen Pain on 3 September 1998 and the Court record shows:
“1..... I note that Messrs Phillips Fox has still not resolve (sic) the matter of their retainer but that this is likely to be resolved by the end of next week. I am adjourning this matter to enable that to be done and I indicate that if the matter is not resolved by the next occasion I will contemplate striking out the action for want of prosecution. I further indicate that any extension of time to file amended pleadings will not be of any great length due to the need for this matter to be prosecuted with due diligence.
2.The plaintiffs to pay the defendants cost of today’s attendance.”
The matter was adjourned for fourteen days to 17 September 1998.
It is not clear why, on 3 September 1998, Judge Bowen Pain thought that the matter warranted being struck out for want of prosecution. I think I have recounted all of the facts which led up to the hearing of 3 September 1998 and it seems to me, with respect, there is nothing about those facts which might have suggested that it would have been appropriate to strike the matter out for want of prosecution at that time.
In any event the matter came back before Judge Bowen Pain on 17 September 1998. The Court file contains the following notes and orders:
“1..... I note that the matter of the retainer of Phillips Fox has now been resolved and that they will continue to act for the plaintiffs in this matter.
2.It is indicated on behalf of the plaintiffs that substantial amendments to the statement of claim are contemplated and I am asked to allow a period of ten weeks for the preparation of the amended statement of claim. This request is not acceptable to the Court.
3...... Leave to the plaintiff to submit to the defendant’s solicitors within twenty-one days a proposed amended statement of claim.
4.Direct that the defendant’s solicitors respond in writing to the plaintiff’s solicitors within seven days of receipt of the proposed amended statement of claim.
5...... The plaintiffs to pay the defendant’s costs of today’s attendant on an indemnity basis.”
The matter was further adjourned to 22 October 1998.
This action involves the plaintiff’s dealings with its bankers over a considerable period of time and involves an examination of a number of transactions, conversations and meetings in relation to those transactions.
Judge Burley had thought that the plaintiff would need at least six weeks and from the tone of his order, probably longer, to properly instruct its new solicitors to enable them to consider the pleadings and any amendments to those pleadings.
Clearly enough the solicitors, who filed the notice of acting on 25 June 1998, would not have embarked on any of that work prior to the retainer between the plaintiff and the solicitors being agreed. It would not have been appropriate for them to do so. It is to be remembered that when the matter was before Judge Burley, prior to the retainer being agreed he had thought that at least six weeks would be necessary and probably more, for the plaintiff’s advisers to consider the plaintiff’s position in relation to the plaintiff’s pleadings.
It seems to me, with the greatest respect to Judge Bowen Pain, that it was unrealistic to require the plaintiff to file an amended Statement of Claim within twenty-one days in litigation of this kind where the plaintiff had, as it were, only just instructed its solicitors.
In any event, the order, in its terms, was inappropriate. The plaintiff did not need the Court’s leave to submit to the defendant’s solicitors any Statement of Claim or any proposed amended Statement of Claim. The plaintiff could do that at any time. Leave is only required for the purpose of filing and serving an amended Statement of Claim: r53.01. I think such an order, which is not envisaged by the Rules, should not be made. It does not advance the action. If the order is complied with there is no obligation on the opposing party to do anything. There is nothing before the Court. In my opinion, if a party wishes to amend a pleading the party should do so by bringing an application to amend and exhibiting the proposed amendment so that there is a record on the Court file which shows when the application and the proposed amendment was made.
Of course a party can disclose to the opposing party a proposed amendment prior to the application to the Court. The other party may then consent. But that is a matter between the parties. The Court is not concerned with agreements between the parties out of Court. If the opposing party agrees that party can say so on the application to amend.
It think it is tolerably clear that by 17 September 1998 Judge Bowen Pain had reached the conclusion that the plaintiff was inexcusably delaying these proceedings.
On 21 October 1998, the plaintiff’s solicitors wrote to the defendant’s solicitors advising that whilst they had been attempting to prepare the proposed further amendment to the Statement of Claim within the time prescribed by Judge Bowen Pain, the task had not been completed. He indicated that he would be filing and serving upon the defendant’s solicitors an affidavit setting out the attempts made to that point of time to finalise the proposed further amended Statement of Claim and the additional time required by the plaintiff to finalise that task.
No doubt that letter was written because the plaintiff’s solicitors were well aware that the matter was to come on for hearing again the next day and that it would be necessary to give some explanation to the Master for not having submitted to the defendant a draft proposed amended Statement of Claim.
As promised in that letter the plaintiff’s solicitor did swear an affidavit setting out what had been done and why it was that the proposed amended Statement of Claim had not been completed. The affidavit was filed and served on 21 October 1998. In that affidavit the solicitor said that he anticipated that he would require a further ten days to complete the proposed further amended Statement of Claim. In particular, he said, the following matters needed to be attended to:
Settling of the Statement of Claim by counsel.
Re-amending the Statement of Claim.
Obtaining final instructions from the clients in relation to the proposed further amended Statement of Claim.
Obtaining instructions from the plaintiff’s accountant in relation to the proposed further amended Statement of Claim.

The Master’s order giving leave for the plaintiff to submit the draft proposed amended Statement of Claim had been made on 17 September. When this affidavit was sworn thirty-four days or about five weeks had passed since that time.
In the affidavit seeking further time to complete the proposed amended Statement of Claim the plaintiff’s solicitor said:
“23... If the Court does not allow the additional time to complete the proposed Further Amended Statement of Claim, the plaintiff’s claim may not succeed as I am of the opinion that the pleadings as they currently stand may result in an adverse finding against the plaintiff’s (sic) as to whether they have properly pleaded their causes of action.
24.The defendant’s (sic) do not suffer any prejudice for a further adjournment of ten (10) days which cannot be cured by an Order for Costs.”
The defendant’s solicitors, no doubt, in response to the letter from the plaintiff’s solicitors to which I have referred, or, the plaintiff’s solicitor’s affidavit, on 21 October 1998, filed an application seeking an order that “the claim in these proceedings be struck out”. That application was supported by an affidavit, sworn on 21 October 1998 by Alicia Videon. That affidavit referred to events subsequent to 24 June 1998 and exhibited the letter from the plaintiff’s solicitors of 21 October 1998 in which those solicitors indicated they would be seeking further time in which to prepare the proposed amended Statement of Claim.
The affidavit did not claim that the defendant would suffer any prejudice of any kind by reason of any extension of time within which to submit the proposed amended Statement of Claim.
Even though there was to be a directions hearing on the next day neither the application nor the supporting affidavit was served on the plaintiff’s solicitors on 21 October 1998.
The defendant’s application to strike out and supporting affidavit were served on the plaintiff’s solicitors at 8:30am on 22 October 1998 for a directions hearing which was to commence at 9:30am.
In my opinion, the defendant’s application, to strike out the plaintiff’s claim could not have come before the Master the next day because it was not made specially returnable and insufficient notice of the application was given to the plaintiff. Less than one hour’s notice was given to the plaintiff’s solicitors. In fact because the partner in the plaintiff’s solicitors firm was out of his office the application did not come to his attention before the hearing. The affidavit could not be relied upon because it was not filed and delivered to all parties two clear days before the occasion for using it arose, as required by r83.01. Furthermore, the plaintiff, however, does not complain about the hearing of that application, notwithstanding the defendant’s failure to comply with r83.01 or r67.04(2).
The plaintiff retained counsel to appear on its behalf at the directions hearing on 22 October 1998.
However, counsel did not attend because a matter in which he was appearing before a Judge of this Court went longer than expected and counsel could not excuse himself. The plaintiff’s solicitor did not attend because he thought counsel was attending. When the plaintiff’s solicitor inquired whether counsel was present he was advised that he was and when, in due course, he became aware that counsel was not present, the matter had already concluded.
I do not think that the plaintiff’s solicitor’s affidavit was ever brought to the attention of the Master at the hearing of 22 October 1998. I think that is a fair inference because, after the hearing, the plaintiff’s solicitors inquired of the defendant’s solicitors as to whether the affidavit was brought to the attention of the Master. The only reply received was:
“I had understood that the affidavit of Mr De Ruvo sworn on 21 October 1998 had been filed (refer letter of Phillips Fox of 21 October 1998) and therefore before his Honour Judge Bowen Pain at the directions hearing on 21 October 1998.”

In any event the Master entertained the application to strike out, at least to the extent of calling it on and fixing the 28 October 1998 as the date for the hearing of the application. He ordered the defendant to advise the plaintiff of the time and date of hearing.
Sometime later on 22 October 1998, the plaintiff’s solicitors wrote to the Master’s secretary apologising for their absence at the directions hearing that morning. They advised that they had arranged to meet counsel at 9:15am but that counsel had not attended because counsel had become jammed in another matter before a judge of this Court.
The solicitors wrote:
“On arriving at the courtroom foyer, I was advised by my client that Mr H had arrived. I then apologised to them for my lateness, and asked why they (sic) were not in the courtroom. I was then told by Mrs Doe that Mr H had not arrived and that the hearing had been called on. It became apparent to me that my client had misunderstood my initial question about counsel’s attendance.”
The plaintiff’s solicitors wrote to the defendant’s solicitors advising that an extension of time within which to comply with the Master’s order would be sought. An affidavit was sworn in support of that proposed application. It is clear from the plaintiff’s solicitors letter that the plaintiff’s solicitors had arranged for at least one of the plaintiff’s directors, counsel and for themselves to be present. Clearly, in the circumstances, no more could have been done.
On the next day the plaintiff’s counsel wrote to the Master advising him why he had not attended . Inter alia that letter indicates that the original and the copy affidavit sworn by the plaintiff’s solicitor were to be handed to the Master at that hearing by counsel.
That letter confirms, in my opinion, that the Master was unaware when he entertained the application to dismiss the claim for want of prosecution of the plaintiff’s solicitor’s affidavit in which the plaintiff’s solicitor indicated the reasons why the proposed further amended Statement of Claim had not been delivered to the defendant.
Because that affidavit was not brought to the attention of the Master on 22 October 1998, the Master was unaware of the reasons why the plaintiff’s solicitors had not been able to prepare the proposed amended Statement of Claim within the time prescribed, although it must be said that the plaintiff’s solicitor’s letter of 21 October 1998 was exhibited to Ms Videon’s affidavit and he was therefore aware that only a further ten days was sought for the purpose of providing that proposed further amended Statement of Claim.
The Master made the following orders:
“1..... There be no appearance by or on behalf of the plaintiff I fix 28 October 1998 at 11:30 am for consideration of the defendant’s application document 21.
2...... Direct that the defendant’s solicitors advise the plaintiff’s solicitors of these orders and have the costs of such notification and today’s attendance, which I fix at $130.”
I do not think that the statement contained in the first sentence in paragraph 1 is correct. It is right that the plaintiff’s solicitor and counsel did not attend. I have already recited the reasons why they were absent. It is not right, however, that there was no attendance by or on behalf of the plaintiff. In fact one of the plaintiff’s directors was present but outside the Court. I assume that the plaintiff could not have been called outside the Court because she would have attended. If the matter had been properly called then no doubt Mrs Doe could have appeared and advised the Court that she expected both her solicitor and counsel to be present. It appears the matter was not called in accordance with the appropriate procedures.
The matter then came on for hearing on 28 October 1998. The Master gave ex tempore reasons which I set out in full:
“The proceedings in this matter were issued on 13 February 1997. The matter came on for a Status Conference on 23 April 1997 when I gave leave for the pltf to file and serve an amended statement of claim within 7 days. That order was complied with in that an amended statement of claim was filed on 27 May 1997. The matter came back before Judge Anderson on 25 September 1997 when he noted that the parties had endeavoured to negotiate by conciliation and that these deliberations had given rise to the need for substantial amendments to the statement of claim. No orders were made at that time with regard to a time limit for the serving of an amended statement of claim presumably on the basis that it was anticipated that this would be done by consent. The matter then dragged on in relation to the deft’s application for security for costs. That matter was finally resolved by an order of Judge Burley made on 3 March 1998. On that date the pltf was given leave to file an application for leave to amend within the same time. When the matter next came before Judge Burley on 19 May 1998 the matter of an amended statement of claim does not appear to have been addressed. Shortly thereafter the pltf changed solicitors and when the matter next came before Judge Burley on 25 June 1998 it was indicated that amendments to the pleadings was (sic) contemplated and that a proposed statement of claim should be formulated and provided to the deft within 6 weeks of that date. The matter came back before me next on a CEC on 23 September 1998 when I was advised that Phillips Fox were still having difficulties completing their retainer with the pltf. I indicated that on that occastion (sic) if the matter was not satisfactorily resolved I would contemplate striking out the application for want of prosecution and I further indicated that any extension of time to file amended pleadings would not be of any great lengths due to the matter needing to be prosecuted with due diligence. The matter next came before me on 17 September when I was advised that the retainer of Phillips Fox had been resolved and that they would continue to act for the pltf. Mr Mitchell who appeared for the pltf on that occasion asked for 10 weeks to allow for the preparation of an amended statement of claim. I indicated that this was not acceptable to the Court and I gave leave to the pltf to submit a proposed amended statement of claim to the deft’s solicitors within 21 days of 17 September 1998. The matter next came back before me on 22 October 1998 when there was no appearance by or on behalf of the pltf. I have received an explanation by letter from counsel retained to appear on that day and there are affidavits filed by Mr deRuvo dealing with the matter. I am not satisfied that the solicitors for the pltf have applied themselves to this matter with the appropriate care and attention. The pltf had not provided a draft of the proposed amended statement of claim by time given by me on 17 September and indeed have not to date done so. I am concerned that in any event the pltf is talking in terms of a substantial recastingof (sic) the pleading and that this may well result in further delay in respect of any submissions by the deft with regard to the adequacy of such pleadings. I have heard an application by the deftto (sic) strike out the action for failure to comply with the orders made by me. Indeed the pltf would be well aware that I have threatened to consider the striking out of the action of my own volition. Mr Goodall for the pltfs has referred me to the decision of Judge Burley in “McGregor-Dey v SA College of Advanced Education which is an unreported decision and in which Judge Burley although he had some reservations as to whether the pltf would in the future diligently prosecute the action granted leaveor (sic) rather dismissed an application for striking out for failure to prosecute that action. I am conscious of the decision of the High Court in “HL Holdings v the State of Queensland” and the moderating effect which that decision has in relation to matters based on caseflow management. However, in my view this case can be distinguished from the McGregor-Dey case in that if the action is struck out the pltf will still be in time to bring the action. Mr Goodall suggests that the claim in relation to S52 of the Trade Practices Act may be barred but as Mr Walsh QC for the deft indicated that action is challenged on a time basis by the defence already submitted but that the issues raised in such a claim would be covered by any award of damages in the other forms of claim which are made. Having weighed all of the aspects of this matter I do not consider that the pltf has diligently prosecuted this claim and I consider that the action should be struck out on that ground and in particular the failure to comply with my orders of 17 September 1998.”
He then struck out the action.
In my respectful opinion the Master’s decision is wrong for a number of reasons which I shall address, but before I do I wish to comment upon the suggestion which arises out of the Master’s reasons that the plaintiff’s solicitors have failed to apply themselves with appropriate care and attention.
In his ex tempore reasons the Master suggests that perhaps there was some fault on the part of the solicitors in failing to attend on 22 October 1998. The fault, if anyone’s, is that of counsel who has properly and readily accepted responsibility. It cannot be said, in my opinion, on a reading of counsel’s letter explaining why he did not attend that there was any fault on the part of the plaintiff’s solicitors in failing to attend on 22 October 1998. I am not sure why the Master has expressed the view that the plaintiff’s solicitors have failed to apply themselves to this matter with appropriate care and attention.
If his comments relate to matters apart from their non attendance before him on 22 October I do not think there is evidence to support the criticism. I do not think the plaintiff’s solicitor can be criticised for any inaction between June and 17 September. Any delay during that period was caused by the plaintiff putting its affairs in order so that the retainer could be agreed. The plaintiff’s solicitors would not have been able to undertake any work before the retainer was agreed.
If his criticisms are directed to the period after 3 September and before 21 October, in my opinion, there is no evidence to support such criticism. In relation to that period the Master had the affidavit of the plaintiff’s solicitor setting out all that he had done in that period.
With respect, I cannot agree that the plaintiff’s present solicitors have failed to apply themselves “with the appropriate care and attention”. It may be that the previous solicitors were guilty of some delay but I do not read the Master’s criticism as being directed to them.
This Court has not recently examined the circumstances in which it would be appropriate to exercise its power to dismiss an action for want of prosecution.
In my opinion, there is no doubt that the Court has an inherent jurisdiction to exercise such a jurisdiction which is a jurisdiction akin to preventing an abuse of process of the Court: Birkett v James [1978] AC 297. If a plaintiff, or any other prosecuting party fails to diligently prosecute that party’s action against any other party then the failure to do so can amount to an abuse of process of the Court. In those circumstances it might be appropriate to dismiss the action for want of prosecution. The abuse of process is to bring proceedings before the court which would involve a substantial risk that a fair trial of the issues would not be possible due to the delay in the prosecution of the proceedings.
It was argued on this appeal that the power to dismiss for want of prosecution arose out of the Rules themselves. It was said that the power either arose out of r2.09 or r3.01 of the Supreme Court Rules.
Rule 2.09 provides:
“Where any party does not proceed with the hearing of an action or application therein at the time fixed for such hearing, the Court may, on the application of the opposing party or of its own motion, revoke any order to proceed to trial, strike out the action or application or dismiss such action or application for want of prosecution and may do so in order to protect the integrity of case flow management system and to implement the Court’s requirement that matters proceeding at the time fixed for hearing notwithstanding that any injustice to the opposing party might have been avoided by an order for costs or some other order.”
Rule 2.09 does give the Court specific power to dismiss an action for want of prosecution. It also gives the Court the other powers mentioned in the rule itself including the power to revoke any order or strike out an action in the particular circumstances mentioned in r2.09.
However, I do not think the rule has any application in the circumstances of a case such as this. This is not a case where the plaintiff has not proceeded with the hearing of an action or an application at the time fixed for such hearing. This is an application to dismiss for want of prosecution in circumstances where the plaintiff, it is said, has been dilatory in the prosecution of the action. Rule 2.09 has no application.
Rule 3.01 provides:
“Subject to R2 except where the Court otherwise orders no breach of or non compliance with a Rule which does not arise out of disobedience or contumacy in relation to a prior order of the Court shall cause any proceedings to abate or be dismissed out of the Court. In cases of disobedience or contumacy the Court shall not order that the proceedings abate or be dismissed unless there is no other way of securing obedience to or compliance with the orders of the Court. Nothing in this rule affects:
(a).... the inherent jurisdiction of the Court to dismiss proceedings which disclose no cause of action known to the law or cannot by amendment be made to disclose such a cause of action, or which are frivolous, vexatious or abuse of the process of the Court;
(b)the power of the Court to grant a stay of proceedings where the justice of the case so required.”
In my opinion, r3.01 does not add to the jurisdiction of the court to dismiss actions for want of prosecution. It provides a statement of principle which must be applied in circumstances where there has been a breach or some non compliance with a rule which does not arise out of disobedience or contumacy in relation to a previous order of the court. In those circumstances the breach of the rule shall not give rise to the abatement or the dismissal out of the court of the proceedings.
However, where there is evidence of disobedience or contumacy the court must not order that the proceedings abate or be dismissed out of court unless there is no other way of securing obedience to or compliance with the orders of the court.
When the court is confronted with a claim that there has been a breach or non compliance with the rule, r3.01 requires the court to determine:
Whether there has been any previous order of the court relevant to the breach or non compliance of a rule.

Whether the failure to obey that previous order of the court arises out of circumstances of contumacy.

If satisfied that there is no disobedience or contumacy the court cannot cause the proceedings to abate or be dismissed out of court. If satisfied of disobedience or contumacy in relation to the previous order of the court the court shall not order that the proceedings abate or be dismissed unless there is no way of securing obedience to or compliance with the orders of the court.
That rule whilst, of course, important as a statement of principle in relation to the application of the 1987 rules is not directly on point. The issue which confronted the Master in this matter was whether or not this action should be dismissed for want of prosecution in circumstances where the plaintiff failed to take advantage of leave given to it to deliver a proposed amended statement of claim to the defendant. The circumstances did not include an examination of a breach or non compliance with a rule. Nor did the circumstances include disobedience or contumacy of an order of the court. In giving leave to the plaintiff to deliver a proposed amended statement of claim to the defendant the court did not order the plaintiff to do so but simply permitted the plaintiff to do so. The failure to take advantage of an order granting a plaintiff permission to do something cannot be said, in any circumstances, to amount to disobedience or contumacy.
I think, therefore, that r3.01 whilst, as I say, important in relation to the statement of principle enunciated in the rule, is not directly apposite to this application.
I think this matter has to be addressed in conformity with the principles applicable to the exercise of the inherent jurisdiction of the court in relation to applications of this kind. Those principles, of course, have to be understood in the circumstances of the philosophy underlying the 1987 Rules, including the principles enunciated in r3.01 and the principles of case flow management. Some cases decided prior to 1987 may no longer now have application or only limited application in relation to applications of this kind.
The Full Court of this Court considered the question of dismissing an action for want of prosecution in Ulowski v Miller [1968] SASR 277. In that case proceedings were commenced on 25 April 1963 and an appearance entered to the writ of summons on 8 August 1963. No further step was taken in the action until a Statement of Claim was filed on 13 February 1968, the filing of which was irregular because no Notice of Intention to Proceed had been given as required under the Rules. A Notice of Intention to Proceed had to be filed where no step had been taken in the proceedings for twelve months.
The defendant then issued a summons seeking an order that the Statement of Claim be set aside as irregular and that the action be dismissed for want of prosecution. The defendant’s application was governed by order 27 rule 1 which allowed the court to dismiss an action for want of prosecution with costs if the plaintiff failed to file and deliver a Statement of Claim within the time allowed by the Rules. Nothing turns, in my opinion, upon the fact that there was a specific rule dealing with that application for want of prosecution.
Bray CJ discussed a number of decisions, in particular and significantly Allen v Sir Alfred McAlpine & Sons Ltd [1968] 2 QB 229 which he considered at length. That case was later approved by the House of Lords in Birkett v James (supra). In that latter case the House of Lords Lord Diplock said at page 318 (and no other member of the House of Lords disagreed) that Allen v Sir Alfred McAlpine & Sons Ltd stood for the following propositions:
“The power (to dismiss want of persecution) should be exercised only where the court is satisfied either (1) that the default has been intentional and contumelious, e.g., disobedience to the pre emptory order of the court or conduct amounting to an abuse of the process of the court; or (2) (a) that there has been an inordinate and inexcusable delay on the part of the plaintiff or his lawyers, and (b) that such delay will give rise to a substantial risk that it is not possible to have a fair trial of the issues in the action or is such as is likely to cause or to have caused serious prejudice to the defendants either as between themselves and the plaintiff or between each other or between them and a third party.”
Whilst Bray CJ discussed the principles for which Allen v Sir Alfred McAlpine & Sons Ltd stood, he concluded that a number of factors were relevant to the exercise of the judicial discretion: in particular the length of the delay, the explanation for the delay, the hardship to the respondent if the action is dismissed, the prejudice to the appellant if it is not, and the conduct of the defendant in the litigation.
In reaching the conclusions to which I have referred his Honour addressed the procedural aspects of such an application. In respect of those matters he said that there was no obligation on the part of the defendant to give any warning to the plaintiff that an application would be made to dismiss unless some further step is taken within a specified time. Moreover, it was no answer to a defendant’s application to say that the defendant could have applied to have the action struck out earlier. Although in that respect he thought that the defendant’s inaction might be a relevant matter, particularly in relation to the defendant’s conduct in the litigation.

In my opinion, Ulowski v Miller did not follow the decision in Allen v Sir Alfred McAlpine & Sons Ltd.The Full Court in Ulowski v Miller did not limit applications to dismiss actions for want of prosecution to the circumstances suggested in the Court of Appeal or the House of Lords. Ulowski v Miller left open the circumstances which might give rise to an application to dismiss for want of prosecution and simply addressed the discretion to be exercised when any application of this kind was made. It was not a condition that the jurisdiction could only be exercised if the default had been intentional and contumelious or that there had been an inordinate and inexcusable delay on the part of the plaintiff or the plaintiff’s lawyers and that such delay would give rise to a substantial risk that it was not possible to have a fair trial of the issues in the action.
Whilst the decision in Ulowski v Miller would require a court to have regard to all of those matters, in my opinion, Ulowski v Miller did not follow the decision in the Court of Appeal and limit the exercise of the jurisdiction to the circumstances mentioned in that case.
The correctness of Ulowski v Miller has never been doubted although there are other pronouncements of the Full Court which, in a sense, may be inconsistent with it.
Lord Diplock’s dictum was approved by White J in Williams v F S Evans & Sons (1988) 52 SASR 237 at 243.
In that case the Full Court was considering an application to renew a writ which was issued just within a six year time limit. The writ was not served within the period of twelve months then provided for by the Rules. An application was made to renew the writ out of time. The matter was heard by a Master who ordered the renewal of a writ. The defendant appealed to a judge of the Supreme Court who affirmed that order. The defendant then appealed to the Full Court.
White J said at 243:
“The critical point is that the Council disclaimed any actual prejudice. If the principles governing the exercise of the discretion to dismiss an action for want of prosecution apply by analogy, as I think they do, to the exercise of the discretion not to renew a writ or summons (which is the equivalent of dismissal where the time limit has expired), the discretion should only be exercised adversely to the plaintiff when the plaintiff’s default has been intentional and contumelious or where there has been an inordinate or inexcusable delay on his or his lawyer’s part giving rise to a substantial risk that a fair trial would not be possible or to substantial risk of serious prejudice to the defendant: Birkett v James [1978] AC 297, approving Allen v Sir Alfred McAlpine & Sons Ltd [1968] 2 QB 229 (CA). Further, where the plaintiff has delayed in bringing his action in the first place to the last days allowed by the limitation period, he ought thereafter pursue his action with diligence, but there must be, in addition to non compliance with the Rules, some additional prejudice to the defendant from the delay after the issue of the writ to justify dismissal of the action (after expiry of the limitation period ) from want of prosecution: Birkett v James (supra).”
Bollen J also agreed that this Court ought to follow the decision of the majority in Birkett v James. King CJ, however, who agreed in the result, expressed the opinion that what was said as to the relevant prejudice to the defendant in Birkett v James could not necessarily be applied without qualification to an application for renewal of proceedings which had lapsed through failure to serve within time.
The decision in Ulowski v Miller was not referred to in Williams v F S Evans & Sons, no doubt because the application before the Full Court in Williams v F S Evans & Sons was not an application to dismiss for want of prosecution but an application to renew a writ which had otherwise become stale.
I do not understand the Full Court in Williams v F S Evans & Sons to have decided that an application to dismiss for want of prosecution had to be decided in accordance with the dictum of Lord Diplock in Birkett v James. It could not have done so because that was not the issue before the court.
Whilst, no doubt, his Lordship’s dictum was appropriate for the time at which he spoke it is difficult to think that his Lordship’s comments would be appropriate to the procedural rules as they are presently applied.
I think, because the decision in Ulowski v Miller is directly relevant and binding upon me, that it would be appropriate to follow that decision rather than the obiter dictum of White J in Williams v F S Evans & Sons Pty Ltd.
While J’s dictum which adopted the dictum in Lord Diplock’s speech, would make it very difficult, if not almost impossible, for any party to obtain an order to dismiss for want of prosecution except in the very limited circumstances mentioned. Those limited circumstances are not sufficient, in my opinion, to reflect the modern day approach to the law of procedure. A plaintiff or a prosecuting party now has obligations in the conduct of litigation which may not have been recognised in 1978 or indeed in 1990. Those obligations are more than an obligation not to disobey or show contumelious disregard to an order or a rule of the Court. The party has more than an obligation to simply act without inordinate and inexcusable delay on that party’s part or on that party’s legal adviser’s part.
I believe that all parties have an obligation to act in accordance with the Rules and within the time limits prescribed by the Rules. A plaintiff or prosecuting party will be entitled to a dispensation in circumstances where the plaintiff or prosecting party has failed to comply with a rule or an order of the Court if the justice of the case requires it. That party will not be entitled to say to a court that the justice of the case requires a dispensation from an obligation to comply with a rule or order of the Court because the party has not acted intentionally or with contumacy or that there has not been inordinate and inexcusable delay. However, all parties and the Court can expect the party bringing the action to ordinarily observe the Rules of Court and orders of the Court.
The principles of caseflow management are now important principles underlying the procedural rules. Of course those principles cannot be applied so as to prevent a party from litigating an issue which is fairly arguable. Case management cannot ordinarily be used to prevail over the injustice of shutting out a party from an arguable case.
However, there must come a time when a party has so conducted the litigation that it would be appropriate to shut that party out of that party’s litigation even if the point is arguable. Justice delayed can be justice denied. Both the plaintiff and the defendant are entitled to justice. If the plaintiff has conducted his or her case so that the defendant has suffered prejudice or will suffer injustice in defending the case then the defendant is entitled to justice, and justice can only be achieved by shutting the plaintiff out of his or her case. However prejudice to the defendant is not a pre-requisite to the exercise of the jurisdiction to dismiss for want of prosecution. It is an important factor but not the only factor. In considering whether the position has been reached that a plaintiff’s claim must be dismissed for want of prosecution, it seems to me that the principles in Ulowski v Miller subject to one matter are appropriate principles for consideration of an application of this kind, notwithstanding that the principles were first expoused in 1968. The further matter to which regard must be had is the concept of case flow management. If the plaintiff’s inaction has caused prejudice to other litigants then that also is a factor to which regard must be had in considering whether the order should be made. It is not only the parties before the Court who are entitled to justice. There will be circumstances when the plaintiff’s inaction requires that in the interests of the administration of justice the action be dismissed: United Motors Retail Ltd v Australian Guarantee Corporation Ltd (1991) 58 SASR 156 per King CJ at 160.
The appellant claimed that there was an onus upon the respondent to establish irrefutably that the appellant would not in future diligently prosecute the action. In support of that prosecution the appellant relied upon a decision of Judge Burley: McGregor-Dey v SA College of Advanced Education (Unreported Judgment of Burley J, 31.8.92 S3688).
I do not agree with that submission or indeed the decision upon which the submission is based.
An application to dismiss for want of prosecution gives rise to an inquiry into the circumstances of the litigation up to the date of the application. The proceedings will be dismissed or stayed because the prosecuting party has failed to prosecute the action in accordance with the Rules of Court or orders of the Court. The inquiry is historical and requires a determination of the conduct of the litigation to the point of time of the application and whether anyone has been prejudiced thereby and further whether the plaintiff’s inaction has affected the interests of the administration of justice.
The inquiry is not into whether the plaintiff will in the future abide by the Rules of Court or orders of the Court. There is no need to inquire into the future if the past inaction demonstrates that it is in the interests of justice or in the interests of the administration of justice that the matter be dismissed. The application is to dismiss for want of prosecution. That involves a consideration of the history of the litigation. There is no obligation, in my opinion, upon a defendant to establish irrefutably that the plaintiff will fail to diligently prosecute the action in the future. To require a defendant to establish that proposition would impose too great a burden upon the defendant.
Of course it would be a relevant factor if it could be shown that it is highly unlikely that the prosecuting party will prosecute the action with diligence in the future. However, that is not the thrust of the inquiry; the point of the inquiry is the conduct of the litigation to the point of the application to dismiss.
The Master said in his reasons, that if this action is struck out the plaintiff will still be within time to bring the action. Clearly he relied upon that as being a reason to strike the matter out. In my opinion that is an appropriate reason why the matter should not be struck out. If all this order means is that the plaintiff will have to recommence these proceedings, with all the costs associated with such a result, then that is a reason why the action should not be struck out. The order would only have the effect of requiring the plaintiff to pay a very large sum by way of costs.
The Master also, apparently, has accepted Mr Walsh QC’s submission that whilst the Trade Practices matter may be statute barred the plaintiff could still proceed upon the other causes of action raised in the Statement of Claim.
That cannot be an appropriate reason to strike out the matter. Causes of action are not merely matters of form. A party pleads alternative causes of action because a particular situation might make out one cause of action but not make out another. Because a plaintiff still has available to it causes of action apart from the Trade Practices Act is not a reason, in my opinion, to disregard the fact that the striking out of the action will prevent the plaintiff from bringing proceedings under that Act. That again is a reason for refusing the order rather than for making it.
There is no suggestion, in any of the affidavits filed, by either party, that the plaintiff itself or its officers have been guilty of any delay in the conduct of these proceedings. There is no suggestion that they have failed to give instructions to their solicitors in a timely fashion or that they have conducted themselves in any way which might have lengthened these proceedings. In my opinion, the absence of any fault on the part of the plaintiff is good reason not to strike out the plaintiff’s proceedings against this defendant.
There is no suggestion in the affidavits filed on behalf of either party that the defendant has or will suffer any prejudice by any delay which has occurred to this point of time. That, again, is a very important reason for not striking out these proceedings.
There is another reason why this action should not have been struck out. At the time that the action was struck out the plaintiff was not in default of any orders of the Court nor in default of any of the Rules.
True, it is, that the plaintiff had failed to submit a proposed amended Statement of Claim to the defendant’s solicitors within the time prescribed in the order. However, as I have already pointed out, leave to submit a proposed amended Statement of Claim to the defendants was never necessary. Even if it was necessary, it simply meant that the leave had lapsed. That would mean that, in the absence of any extension of the time within which to file and serve an amended Statement of Claim, the plaintiff would have to rely on the Statement of Claim already on the court file. The plaintiff was entitled to proceed on the basis that the Statement of Claim on the court file contained its case against the defendant. The plaintiff had otherwise complied with all procedural steps.
In those circumstances it was not appropriate to strike out the plaintiff’s claim. The most the defendant could have hoped for was an order refusing the plaintiff leave to file a further amended Statement of Claim.
In my opinion this appeal should be allowed and the orders made by the Master set aside.
In lieu thereof there should be an order dismissing the defendant’s application to strike out the plaintiff’s claim.
I will hear the parties as to the costs of the application before the Master and an appeal.

[1999] SASC 124

31 March 1999