Carolan v State of New South Wales

[2013] NSWSC 1593

Supreme Court

New South Wales

Medium Neutral Citation:

Carolan v State of New South Wales and Anor [2013] NSWSC 1593

Hearing dates:

29 October 2013

Decision date:

29 October 2013

Jurisdiction:

Common Law

Before:

Johnson J

Decision:

The Notice of Motion filed 2 October 2013 seeking dismissal of the proceedings for want of prosecution is dismissed.

Pursuant to Rule 14.24 Uniform Civil Procedure Rules 2005, the Plaintiff is granted leave to file a verified Further Amended Statement of Claim within fourteen days of today.

The Plaintiff is to file and serve any further evidence by 19 November 2013.

The Defendants are to file and serve any further evidence by 3 December 2013.

The Plaintiff is to pay the costs of the Defendants of this Notice of Motion by way of a gross sum costs order under s.98(4)(c) Civil Procedure Act 2005 in the sum of $6,000.00, that sum to be paid within 28 days of today.

Catchwords:

PRACTICE AND PROCEDURE - application by Defendants to dismiss proceedings for want of prosecution - claim by Plaintiff under s.219 Law Enforcement (Powers and Responsibilities) Act 2002 for delivery of property to him - police seized $702,000.00 in cash from Plaintiff - claim by Plaintiff for return of money - history of non-compliance by Plaintiff with court orders - whether proceedings should be dismissed for want of prosecution - exceptional remedy declined - orders made to progress litigation - Plaintiff to pay Defendants' costs of Notice of Motion by way of gross sum costs order

Legislation Cited:

Civil Procedure Act 2005
Law Enforcement (Powers and Responsibilities) Act 2002
Uniform Civil Procedure Rules 2005

Cases Cited:

Anderson v Judges of the District Court of New South Wales (1992) 27 NSWLR 701
Appeal of Phillip Allan Grant (His Honour Judge Shannon QC, District Court of New South Wales, 25 September 1981) 6 Petty Sessions Review 2568
Application of Hampton (1972) 3 DCR 59
Commissioner of Police v Bennett (McInerney J, Supreme Court of New South Wales, 17 October 1991) 9 Petty Sessions Review 4311
Fairey v Fairey (No. 2) [2000] NSWCA 173
Fantakis v Commissioner of Police [2013] NSWSC 685
Fleet v State of New South Wales [2009] NSWSC 75
Knorr v Commonwealth Scientific and Industrial Research Organisation and Others (No. 3) [2012] VSC 529
Moloney v Collins [2011] NSWSC 628
Szczygiel v Peeku Holdings Pty Limited [2006] NSWSC 73
Udowenko v St George Bank (A Division of Westpac Banking Corporation) (No. 2) [2011] NSWSC 1122

Texts Cited:

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Category:

Interlocutory applications

Parties:

Sean Carolan (Plaintiff)
State of New South Wales (First Defendant)
Commissioner of Police for New South Wales (Second Defendant)

Representation:

Counsel:
Mr G Jones (Plaintiff)
Mr B Thomson (Solicitor) (First and Second Defendants)
Solicitors:
Michael Croke & Co (Plaintiff)
IV Knight, Crown Solicitor (First and Second Defendants)

File Number(s):

2012/355618

Publication restriction:

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Judgment

1. JOHNSON J: By Notice of Motion filed 2 October 2013, the Defendants (the Applicants on the Motion), the State of New South Wales and the Commissioner of Police for New South Wales, seek orders that proceedings commenced by the Plaintiff (the Respondent to the Motion), Sean Alexander Carolan, be dismissed for want of prosecution under Rule 12.7 Uniform Civil Procedure Rules 2005 ("UCPR").

1. The Plaintiff commenced proceedings by Summons filed 15 November 2012. In its present form, the latest pleaded claim is an Amended Statement of Claim filed on 8 October 2013 (by which the Commissioner of Police for New South Wales was joined as Second Defendant).

The Principal Claim for Relief

1. The proceedings involve an application under s.219 Law Enforcement (Powers and Responsibilities) Act 2002 ("LEPRA") for the delivery to the Plaintiff of the sum of $702,000.00 in cash taken from him by police on 11 August 2011.

1. The evidence before the Court on this application indicates that the Plaintiff has not been charged with any offence with respect to this sum of money. As the sum involved exceeds $250,000.00, the application is brought to this Court: s.229(1)(c) LEPRA.

1. It is appropriate to make some short observations with respect to the claim brought by the Plaintiff in these proceedings.

1. It has been said that an application under s.219 LEPRA does not involve ordinary litigation, but has, as one of its objects, the protection of police who have in their possession property, with the provision designed to resolve a situation where the police entertain a doubt as to whether the person applying for the delivery of the property does in fact have lawful title to the property: Commissioner of Police v Bennett (McInerney J, Supreme Court of New South Wales, 17 October 1991) 9 Petty Sessions Review 4311 at 4314; Fantakis v Commissioner of Police [2013] NSWSC 685 at [44].

1. An Applicant bears the civil onus of establishing affirmatively lawful entitlement to the property: Application of Hampton (1972) 3 DCR 59 at 61; Appeal of Phillip Allan Grant (His Honour Judge Shannon QC, District Court of New South Wales, 25 September 1981) 6 Petty Sessions Review 2568; Anderson v Judges of the District Court of New South Wales (1992) 27 NSWLR 701 at 710-11. An issue in these proceedings, in due course, will be whether the Plaintiff can demonstrate lawful entitlement to the property, being the sum of money in question.

1. The affidavit of the Plaintiff affirmed 25 May 2013 records that, on 11 August 2011, he attended the Hilton Hotel at Sydney, where he had a booking. He had in his custody a suitcase containing $702,000.00 (which was seized by the police that day). According to the Plaintiff, he had received this money from a person named Owen Hanson Jnr that afternoon. The Plaintiff states that he was informed by Mr Hanson, and verily believed, that these moneys were lawfully acquired by Mr Hanson. The Plaintiff states that he had been informed by Mr Hanson that he wished to invest these moneys in a company named Witiki Pty Limited, a company providing services, including weight loss and an anti-ageing clinic. The Plaintiff states that he was, and remains, a director and shareholder of Witiki Pty Limited, and that additional directors and shareholders of that company at that time were Doctor Les Blackstock and Mr Hanson.

1. The Plaintiff states that he was informed that these funds were derived from legitimate business interests of Mr Hanson, which included the promotion of music tours. The Plaintiff states that the moneys were forwarded to him for investment purposes, and he was responsible and liable to the investor for these funds.

1. That is the basis of the Plaintiff's claim for the delivery up of the sum of money to him.

1. It is not for me, on this application, to rule upon the merits of the Plaintiff's claim. I pause to observe that transmission of moneys for investment purposes is usually undertaken in more orthodox ways, such as electronic transfer or cheque, with the movement of more than $700,000.00 in cash, on the face of it, being attended by unusual and unnecessary risks of loss or theft. It will be for the trial Judge to consider and assess the claim at the final hearing, the critical issue, it would seem, being whether the Plaintiff can establish lawful entitlement for the purposes of the section.

Application for Dismissal for Want of Prosecution

1. I turn to the application to dismiss the proceedings for want of prosecution.

1. Section 56 Civil Procedure Act 2005 imposes a statutory obligation on civil litigants to take steps to facilitate the just, quick and cheap resolution of the proceedings. That obligation binds the Plaintiff, as well as other parties to this litigation.

1. The provisions contained in ss.56-61 Civil Procedure Act 2005 require the Court to have regard, amongst other things, to the timely disposal of proceedings and all other proceedings in the Court, at a cost affordable to the respective parties, and to the efficient use of available judicial and administrative resources and the efficient disposal of the business of the Court. The Court must have regard to the dictates of justice, but all of those matters are related to the function of the Court, and the obligation of litigants, to progress litigation: Fleet v State of New South Wales [2009] NSWSC 75 at [14].

1. The concept of proceedings being dismissed without a hearing is not a novel one. The provisions in ss.56-61 Civil Procedure Act 2005, in a context such as this, may lead to such an outcome. As Campbell J (as his Honour then was) said in Szczygiel v Peeku Holdings Pty Limited [2006] NSWSC 73 at [7]-[13], the complex of statutory provisions in ss.56-61 means that it is within the specific intent of the statutory framework, in which the Court conducts its business, that it can on occasions be prepared to dismiss proceedings, even though there has not been a hearing on the merits, in circumstances where there has been a failure to comply with directions.

1. It has been said that an order dismissing proceedings for want of prosecution is an exceptional order, and it is a power not to be lightly exercised: Fairey v Fairey (No. 2) [2000] NSWCA 173 at [52].

1. At the same time, where a foundation is demonstrated for an exceptional order of this type, the Court should not hesitate to make that order. It remains, however, an exceptional order, and the Court ordinarily will allow a Plaintiff to proceed with a claim to a hearing on the merits.

1. It is appropriate to turn to the history of this litigation. The proceedings are not yet a year old. That does not mean that they are in some way immune from dismissal for want of prosecution. An extended and protracted period of inaction (or non-compliance with orders) is not an essential prerequisite to the exercise of the power to dismiss for want of prosecution: Udowenko v St George Bank (A Division of Westpac Banking Corporation) (No. 2) [2011] NSWSC 1122 at [26]; Knorr v Commonwealth Scientific and Industrial Research Organisation and Others (No. 3) [2012] VSC 529 at [26].

1. From the outset of these proceedings in 2012, there have been failures on the part of the Plaintiff. There was a failure to serve the initial Summons within the time required by law.

1. At a directions hearing on 7 December 2012, certain orders were made for the service of the Summons and affidavit in support, and there was a failure to comply with those orders of the Court.

1. In due course, on 8 February 2013, a further order was made for service of the affidavit in support of the Summons, but service was not effected within the time ordered by the Court.

1. A further order was made on 25 March 2013 for service by the Plaintiff of affidavit evidence, but that order was not complied with within the time set by the Court.

1. Correspondence passed between the solicitors for the Plaintiff and the then Defendant as the year passed by. The State of New South Wales was the only Defendant in this period. In due course, at a further directions hearing on 10 May 2013, the Plaintiff was ordered to file and serve his evidence by a nominated date. He was ordered, as well, to pay the Defendant's costs of the day, given his non-compliance with the timetable.

1. On 27 May 2013, an affidavit of the Plaintiff sworn 25 May 2013 was served on the Defendant (it is that affidavit to which I have made mention at [8]-[9] above).

1. A directions hearing was listed for 13 June 2013, and there was no appearance by the Plaintiff. The question of costs of that day was reserved.

1. In June 2013, the Plaintiff sought to move for summary judgment and, in due course, did not press that claim. It appears that Rothman J determined that the proceedings should advance on pleadings, and a direction was given for a Statement of Claim to be filed by the Plaintiff by 10 July 2013. That order was not complied with.

1. In late July 2013, there was an email message from the solicitor for the Plaintiff indicating that the Plaintiff was ill.

1. On 29 July 2013, the Plaintiff was ordered again to file and serve a Statement of Claim, and the Plaintiff was ordered again to pay the costs of the Defendant as a result of non-compliance.

1. On 5 August 2013, a Statement of Claim was served by the Plaintiff upon the Defendant.

1. On 26 August 2013, at a directions hearing, the Plaintiff was ordered to file and serve, by a nominated date, an Amended Statement of Claim joining the Commissioner of Police for New South Wales. That order was not complied with.

1. Against this background, on 2 October 2013, the Defendants filed the Notice of Motion to which this judgment relates, and an affidavit in support.

1. Following the filing and service of that Motion, an Amended Statement of Claim was filed on 8 October 2013. That pleading has a number of irregularities and deficiencies, which have been explored at the hearing of this Motion.

1. Since that time, a number of affidavits have been filed, including two affidavits of Michael Croke, the solicitor for the Plaintiff, which were filed in Court today. Mr Croke gave evidence at the hearing, as indeed did the Plaintiff.

1. The deficiencies in a number of the documents which have been filed have required the Defendants and the Court to consider the adequacy of those documents in the course of the hearing of this Notice of Motion.

1. I accept the evidence of Mr Croke that personnel changes in his office during 2013 have contributed largely to what has happened, and what has not happened, in this litigation. There have been breakdowns in communications and poor attention to detail. Those matters serve to explain most of the defaults to which reference has been made.

1. That said, the Plaintiff has served his affidavit of 25 May 2013 (which contains his primary case) upon the Defendant. In addition, the Court is aware that there is an affidavit of Detective Sergeant Grant Findley, sworn 11 June 2013, which annexes police interviews of persons, including Mr Hanson. Accordingly, there are materials relating to the events relevant to this application which are in the possession of the Plaintiff and the Defendants.

1. Mr Jones, counsel for the Plaintiff, has indicated that the evidence for the Plaintiff is effectively that which has been served, subject to the prospect of some supplementary evidence from some of the other persons who have been mentioned.

1. Insofar as the Defendants are apprehensive that the Plaintiff's chequered history in the conduct of this litigation may continue, the power exists for the Court to control the proceedings now and, if the occasion arises, at a later time.

1. The sum of $702,000.00, of course, remains in the custody of the Defendants.

1. The question of prejudice to the Defendants resulting from the history of this litigation may, in my view, be met effectively by orders to progress the litigation, a costs order with respect to today, and the expression of a clear understanding that any future default on the part of the Plaintiff would see a less sympathetic view adopted to the litigation.

1. I am, however, not satisfied that the Court should take the exceptional step of dismissing the proceedings without a hearing on the merits, and I decline to take that course.

Further Orders and Costs

1. Submissions have been made by Mr Thomson, for the Defendants, and by Mr Jones concerning what orders may be appropriate if the view was taken that the Motion should be dismissed.

1. I propose to make orders which will progress the litigation, and will allow the Plaintiff to put into proper and compliant form the Amended Statement of Claim (which is presently defective), together with orders for the Plaintiff and the Defendants to file and serve any further evidence to be relied upon. Orders will be made which will require these steps to be taken by 3 December 2013.

1. I will make an order listing the proceedings for directions before the Registrar at 9.00 am on Thursday 5 December 2013, on which occasion a hearing date, I trust, will be allocated with the parties having an ability by then to give a reliable estimate for a hearing.

1. The question of costs of the Motion has been the subject of submissions. Although I will dismiss the Notice of Motion filed by the Defendants, I propose to order the Plaintiff to pay the Defendants' costs. It is, in my view, clear that the taking of the step of bringing this Motion provided a type of kickstart for the Plaintiff in this litigation. The hearing today, I trust, will have focused the minds of those involved.

1. In these circumstances, the appropriate exercise of the costs discretion will see the Plaintiff being ordered to pay the costs of the Defendants.

1. I raised with the legal representatives for the parties the form of order which ought be made. This has been a discrete step in the litigation. It is one, in my view, which should see a discrete costs order being made, which ought be quantified today and paid within a set period.

1. In the absence of any specific order, an order for costs on an interlocutory basis will not be enforceable until the end of the proceedings. I propose to make an order under s.98(2) Civil Procedure Act 2005 and Rule 42.7 UCPR that will permit those costs to be payable now, and not be left until the proceedings are at an end. The justice of the case, it seems to me, calls for that approach.

1. A further step which has been discussed with counsel, and which I propose to take, is to make a specified gross sum costs order under s.98(4)(c) Civil Procedure Act 2005 instead of assessed costs. That power is properly used in circumstances where there is a discrete hearing and costs order, and where it may be counterproductive for the parties to run up even more costs assessing the costs of a hearing such as this: Moloney v Collins [2011] NSWSC 628 at [81].

1. The parties have agreed that a sum of $6,000.00 represents a fair and appropriate quantum for such a gross costs order, with that sum to be paid within 28 days. Apart from anything else, it seems to me that an order of this type will further focus the minds of those on the Plaintiff's side on the need to progress this litigation in an orderly and timely fashion, in compliance with the obligation under the Civil Procedure Act 2005.

1. I make the following orders:

(a)   The Notice of Motion filed 2 October 2013 seeking dismissal of the proceedings for want of prosecution is dismissed.

(b) Pursuant to Rule 14.24 UCPR, the Plaintiff is granted leave to file a verified Further Amended Statement of Claim within fourteen days of today.

(c)   The Plaintiff is to file and serve any further evidence by 19 November 2013.

(d)   The Defendants are to file and serve any further evidence by 3 December 2013.

(e) The Plaintiff is to pay the costs of the Defendants of this Notice of Motion by way of a gross sum costs order under s.98(4)(c) Civil Procedure Act 2005 in the sum of $6,000.00, that sum to be paid within 28 days of today.

(f)   I vacate the present listing of the proceedings before the Registrar this Friday, 1 November 2013. In its place, I list the proceedings for directions before the Registrar at 9.00 am on 5 December 2013, in particular for the purpose of the allocation of a hearing date.

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Decision last updated: 05 November 2013