Coad v Dimmick
[2013] TASSC 48
•29 August 2013
[2013] TASSC 48
COURT: SUPREME COURT OF TASMANIA
CITATION: Coad v Dimmick [2013] TASSC 48
PARTIES: COAD, Gary John
v
DIMMICK, Brian Leonard
FILE NO: 568/2004
JUDGMENT
APPEALED FROM: Dimmick v Coad [2013] TASSC 19
DELIVERED ON: 29 August 2013
HEARING DATE: 26 July 2013
JUDGMENT OF: Porter J
CATCHWORDS:
Procedure – Supreme Court procedure – Tasmania – Procedure under Rules of Court – Other matters arising before trial – Application for stay of proceedings – More than six years since a step taken in the proceeding – Court ordered mediation is a "step taken in a proceeding".
Supreme Court Rules 2000 (Tas), r56.
Argo Pty Ltd vState of Tasmania (No 3) (2004) 13 Tas R 69; Artahs Pty Ltd v Gall Standfield & Smith (A Firm) [2012] QCA 272, considered.
Aust Dig Procedure [278]
REPRESENTATION:
Counsel:
Appellant: M E O'Farrell SC
Respondent: R Browne
Solicitors:
Appellant: Blissenden Lawyers
Respondent: FitzGerald & Browne
Judgment Number: [2013] TASSC 48
Number of paragraphs: 58
Serial No 48/2013
File No 568/204
GARY JOHN COAD v BRIAN LEONARD DIMMICK
REASONS FOR JUDGMENT PORTER J
29 August 2013
Introduction
This is an application for an extension of time to institute an appeal from a decision of the Associate Judge. The notice of appeal was filed but not served within the required time. As the respondent's principal argument as to the extension of time is that the appeal has no merit, I heard the application and the appeal together. It is common ground that if the appeal lacks any merit, the application fails. The order appealed from is one dismissing an application by the appellant, the defendant in an action, for a stay of proceedings.
The issue for determination in the appeal is whether court–annexed mediation, ordered by a judge of the Court, is a step in a proceeding within the meaning of r56 of the Supreme Court Rules 2000 (SCR). The rule provides as follows:
"56 Notice after delay of 6 years
(1) If a step, other than an application on which no order has been made, has not been taken in a proceeding for 6 years since the last step was taken, a party may not take any further step in the proceeding without the order of the Court or a judge."
For the reasons which follow, I consider that the appeal is without merit. It follows that the application to extend time should be dismissed.
Background
The respondent/plaintiff's action against the appellant is for damages for personal injuries. The writ was issued on 9 November 2004. On 14 November 2006, a judge made an order in terms of a consent memorandum filed by the parties on the same day. The letter sought an order "That the matter be listed for a Conciliation Conference". It is common ground that what was sought was an order referring the matter for mediation. On 1 December 2006, the Court Registrar notified the parties that the mediation would be conducted at the Court in Hobart at 10.00am on 8 December 2006. Apparently, that time was not suitable for one or other of the party's lawyers, and the Registrar set the date of 28 February 2007. The Court "Record of Settlement Conference", dated that day, shows that counsel for both the plaintiff and the defendant attended the mediation without their clients, and were in conference for one hour before the mediation was "adjourned".
The next relevant thing that happened after 28 February is that the respondent, by his new solicitors, applied for orders of discovery by letter dated 14 January 2013. On the return of that application on 12 February, the appellant's counsel told the Associate Judge that the appellant was taking the point in relation to r56. The state of the pleadings was also raised. By letter of 26 February 2013, the respondent applied for a grant of leave to amend the statement of claim. Both of the respondent's applications came back before the Associate Judge on 28 March. The appellant's application for a stay was heard on that day and a later date to which the matter was adjourned. On that later date his Honour dismissed the stay application.
The Associate Judge's reasons
Holt AsJ published his reasons: Dimmick v Coad [2013] TASSC 19. His Honour briefly referred to the history of the matter, set out r56(1), and noted that the only activity which the respondent contended amounted to a step in the proceeding, and which occurred in the six years before the applications by letter, was the participation of the parties at the mediation conference on 28 February 2007. His Honour then continued:
"3 A step in a proceeding is 'some step in the action, required by the rules of procedure, but not necessarily carried out in accordance with those Rules, to carry the action forward to a final judgment'. Argo Pty Ltd vAttorney-General (No 3) (2004) 13 Tas R 69 at par[27].
4 …
5 Counsel for the plaintiff submitted that, as it is a requirement in order to have an action for damages for personal injury set down for trial that the parties discuss settlement, the mediation conference is a step in the action required by the rules to carry the action forward to a trial and final judgment.
6 Rule 541(1) relevantly provides:
'Before filing a certificate of readiness, the parties to an action must confer together to —
(a) reach agreement on as many matters as possible; and
(b) discuss the possibility of settlement of the action; …'
7 Rule 544 provides that the parties must complete a certificate of readiness in accordance with the prescribed form. Rule 547 provides that after the certificate of readiness is filed a pre-trial conference is to occur, unless on receipt of the certificate a judge orders that a pre-trial conference need not be held and that the action can be listed for trial. The prescribed form for the certificate of readiness is in the Supreme Court Forms Rules 2000, Form 42 and in par1(h)(6) requires the parties to certify that the possibility of settlement had been seriously explored.
8 Generally, mere talk between solicitors does not amount to the taking of a step in a proceeding. See Ives & Barker v Willans [1894] 2 Ch 478 at 484, per Lindley LJ. However, here in personal injury actions the rules require the parties to conduct settlement negotiations as a prerequisite to the action being set down for trial, and so such discussions between solicitors amount to a step required by the rules to carry the action forward to a final judgment.
9 There was no suggestion that the parties, through their solicitors, did not discuss the possibility of settlement at the mediation conference and I infer, from the nature of such conferences, that settlement was discussed.
10 …
11 In view of my finding that the mediation conference on 28 February 2007 relevantly amounted to a step in the proceeding in which damages for personal injury are claimed, the plaintiff does not need leave to proceed under r56 and may have his applications for discovery and leave to amend the statement of claim heard and determined.
12 The defendant's application for a stay is dismissed."
Mediation – the statutory provisions
Section 5(1) of the Alternative Dispute Resolution Act 2001 provides "that a court may, by order, refer a matter arising in proceedings before it … for mediation or neutral evaluation if the court considers the circumstances appropriate and whether or not the parties to the proceedings consent to the referral". Section 7(2) of that Act provides that unless otherwise agreed by the parties or as directed by the court, the costs of a party of and incidental to the mediation or neutral evaluation are to be that party's costs in the cause.
Mediation is dealt with in Part 20 of the SCR. The Part was substantially amended in October 2012, but the amendments have no effect on the the issue to be considered. Rule 518 was, at the time of the mediation, in the following terms:
"518 Reference to mediation
(1) At any stage in a proceeding a judge, with or without the consent of any party, may order that the proceeding or any part of it be referred for mediation.
(2) If a matter is referred to mediation, the mediator is to be —
(a)the Principal Registrar; or
(b)a suitable person appointed by the Principal Registrar.
(3) Unless otherwise ordered, an order under subrule (1) does not operate as a stay of proceedings."[1]
[1] Rule 518 is now simply in the terms of what was r518(3).
SCR, r523, deals with the costs of mediation. Rule 523(1) was in similar terms to s7(2) of the Alternative Dispute Resolution Act. Rule 523 is now only in the form of the former r523(2), which provided that a judge may order that a party recover costs of and incidental to mediation from another party if those costs have been unnecessarily incurred by the conduct of that other party.
Division 1 of Part 22 of the Rules is entitled "Setting down for trial". The Division contains rules prescribing compulsory conferences in actions and the preparation and filing of a certificate of readiness. The relevant parts of rr541, 544 and 547, are set out or described in pars[6] and [7] of the Associate Judge's reasons set out above. As his Honour noted, the prescribed form of the certificate of readiness requires the parties to certify that the possibility of settlement had been seriously explored.
The grounds of appeal
There are four grounds of appeal as follows:
"(i)the learned Associate Judge erred in finding the conduct of the mediation was a step in the proceeding;
(ii)the learned Associate Judge erred by not finding a mediation was not a step in the proceeding;
(iii)the learned Associate Judge erred by, in the absence of any evidence, inferring that at the mediation (on 28 February 2007) that settlement was dismissed [sic discussed];
(iv)the learned Associate Judge erred by concluding the attendance at a mediation conference was the same or equivalent to the parties certifying they had attended a compulsory conference for the purposes of signing a Certificate of Readiness."
As is evident, ground (i) asserts an error "in finding the conduct of a mediation was a step in the proceedings". Somewhat unnecessarily, ground (ii) alleges an error by not finding that a mediation was not a step in the proceedings. I will treat the two grounds as one. As I understand it, they are directed to the issue of whether, as a matter of principle, a mediation conference is capable of being a step in a proceeding. The appellant's position is that mediation cannot amount to a step in a proceeding, whether it be successful in part in resolving some issues but not the action, or unsuccessful. Grounds (iii) and (iv) are self-evident; they are directed towards the particular finding about the mediation conference on 28 February 2007, and the Associate Judge's reasoning and conclusion based on the certificate of readiness process. Although the arguments as to ground (iv) overlapped a little with those relating to (i) and (ii), I will deal with them as they appear in the notice of appeal.
Grounds (i) and (ii)
The appellant's arguments can be summarised as follows:
· Not every process envisaged by the rules is a step in the proceeding. "To be a step the activity must carry the proceeding forward, it must be something which is intended to continue the litigation"; something which is a means of prosecuting the action towards trial.
· Mediation is not required under the SCR; the power to order mediation is discretionary. As a concept, mediation is neither needed nor intended to carry the action forward to final judgment.
· A primary purpose of mediation is to settle the case; to dispose of the action. That "is the very antithesis of prosecution towards judgment." "Mediation is an amorphous and inflexible tool … " which may result in settling an action on a basis and on terms unconnected with the action itself.
· In this case, the consent order simply meant that the action was referred for mediation, as a consequence of which a date was given by the Court. It imposed no obligations on the parties, and there is no evidence that anything happened which had a discernible impact on the prosecution of the action.
For the general propositions inherent in these submissions, senior counsel for the appellant, Mr O'Farrell SC, relies on the primary authority in this State; that referred to by the Associate Judge: Argo Pty Ltd v State of Tasmania (2004) 13 Tas R 69. In that case, Underwood J (as he then was) first considered the equivalent rule under the Rules of the Supreme Court 1965, O79, r11, which referred to a "proceeding" not having been taken, rather than "a step in a proceeding". His Honour held that the two terms were synonymous for the purposes of comparison.
At 77 [27], his Honour concluded that "proceeding" in the former provision meant "some step in the action, required by the rules of procedure, but not necessarily carried out in accordance with those Rules, to carry the action forward to a final judgment". That is the passage referred to by the Associate Judge. At 78 [31], having considered whether the word "step" added anything to the notion, Underwood J said:
"A step in a proceeding as enacted in r56 is an action required by the rules to prosecute an action to judgment but this does not mean that the step must necessarily be taken in the manner prescribed by the rules."
Mr O'Farrell referred to Burns v Korff (1982) 8 QL 201, a decision of Master Lee (as he then was) referred to by Underwood J in Argo, and from which his Honour said he obtained "very considerable assistance". The relevant passage from Burns, and that which is set out in Argo, is at 208. As that passage, and the one immediately preceding it on the same page, have both been referred to by counsel in this case, I will set out both:
"Nor does the rule provide that any 'step' or 'proceedings' if taken by way of application to the court, must necessarily have resulted in a successful order in favour of the applicant, before it can be said to comprise a 'proceeding' or a 'step in the cause'. In other words, a proceeding may consist, for example, of an application for discovery or for an order that interrogatories be delivered or answered, which application may in fact be dismissed. It cannot be said that any such application does not constitute a 'proceeding'. It shows that the action is 'alive' and it may also be said that even a dismissed application advances the cause towards ultimate judgment in favour of one party or the other.
It may generally be said that a 'proceeding' includes an application to the court upon which an order is made, and also includes certain other activities contemplated by the Rules, which do not amount to a formal application to the court, eg, the delivery of a pleading, notice of trial, etc: Taylor v Roe (1893) 62 LJ Ch 391 per Kekewich J at 392; Kaats v Caelers [[1966] Qd R 482] at 499 per Stable J where his Honour referred to a step taken by the litigant in the prosecution of the action, being a step required by the Rules. The common feature in all of these activities is that in a general way, the activity is recognised by the Rules as an activity which positively advances the cause and its conduct towards ultimate judgment, whether in favour of a plaintiff or a defendant."
The appellant also relies on Citicorp Australia Ltd v Metropolitan Public Abattoir Board [1992] 1 Qd R 592, another authority referred to by Underwood J in Argo. At 592 of Citicorp, McPherson SPJ (Ryan and Dowsett JJ agreeing) said he thought it should "be accepted that to constitute a 'proceeding' the act or activity must have the characteristic of carrying the cause or action forward". His Honour said that the act or activity may be "some step taken toward the judgment or relief sought in the action", or "taken with a view to continuing the litigation between the parties to it", citing Kaats v Caelers [1966] Qd R 482 at 489 (sic 499) and Spincer v Watts (1889) 23 QBD 350 at 353, respectively.
In Kaats, at 499 immediately after the statement quoted in Citicorp, Stable J referred to what Maugham J had said in Mundy v The Butterley Co Ltd (1933) LJ Ch 23 at 26; ([1932] 2 Ch 227 at 233). As Stable J put it, Maugham J "considered, without attempting anything more than an approximation to the sort of proceedings pointed to by the rule[2] … that the word 'proceeding' … is one that suggests something in the nature of a formal step, at least a step taken by the litigant in the prosecution of the action, being a step required by the rules." I will return to Mundy's case.
[2] The rule under consideration in Mundy was not a rule similar to SCR, r56. It was O26, r1 of the English Rules of the Supreme Court 1883, which relevantly provided that the plaintiff may, after the receipt of the defendant's defence but before any other proceeding in the action (save any interlocutory application), by notice in writing wholly discontinue the action against any or all of the defendants.
Counsel for the respondent, Mr Browne, submits that to qualify as a step, the act or activity need not be done in strict preparation for trial; the test is broader than that. A mediation will show that the proceedings are "alive", and even if the action is not resolved, it may advance the cause by defining or limiting the issues. The obvious examples are where the parties agree on liability leaving an assessment of damages; and the reverse situation, where quantum is agreed leaving a dispute on liability.
Mr Browne pointed out that a number of regular features of the litigation process would amount to steps in the proceeding, but which are not actually required to be taken by a party. Mr Browne also relies on the judgment in Burns v Korff. In the passage set out in par[16] above, although noting the statement in Kaats v Caelers to the effect that a "step [was one] required by the Rules", Master Lee went on to say that the common feature of the activities he had described (and which would qualify as 'proceedings'), "is that in a general way the activity is recognised by the Rules as an activity which positively advances the cause and its conduct towards ultimate judgment, …".
Discussion
Must a step be one "required by the rules"?
Clearly, there have been various statements made as to the meaning of "proceeding" or a "step in a proceeding". In Argo, Underwood J examined many of these statements and concluded that for the purposes of SCR, r56(1), a step taken in a proceeding meant, putting the relevant statements of his Honour together, a step required by the rules to prosecute an action to judgment. As shown by the outline of the arguments in this case, a point within the Argo formulation which was the subject of debate, is the stated need for the step to be one required by the rules. On its face, this would mean that the step has to be a compulsory one under the rules; that is, one which must be done in order to prosecute the action. I should follow Argo unless I am persuaded that it is plainly wrong.
As I see it though, this particular point was not the subject of any argument in Argo. Mr Browne submits that Underwood J's statement in Argo cannot be interpreted as meaning "required" in the strict sense. It is true that there are a number of things which would often qualify as steps taken in a proceeding, but which are not compulsory under the rules. As noted in Burns v Korff (above), an application for an order that interrogatories be delivered which may in fact be dismissed, may amount to a proceeding. The actual delivery of interrogatories, although not compulsory, would undoubtedly amount to a step taken in a proceeding. As I understand it, Mr O'Farrell did not seek to argue that the statement in Argo meant that the putative step be compulsory. He submitted that the word "required" was used in the sense of the act or activity being needed to advance the litigation, whether or not the party acting has an option.
The issue is whether, for an act or activity to be a step taken in a proceeding, it needs to be one required by the rules to be taken. There is support for a broader view of things. The question was specifically discussed by Peter Lyons J in Artahs Pty Ltd v Gall Standfield & Smith (A Firm) [2012] QCA 272. At [40] – [42], his Honour referred to the statement in Kaats v Caelers (above) that the step had to be one required by the rules. His Honour pointed out, as I have shown above, that this statement came from the judgment of Maugham J in Mundy v The Butterley Co Ltd (above). At [42] his Honour said:
"The words relied upon were followed immediately by a qualification made by his Lordship (expressly referred to in Kaats):
'... I am not attempting a complete definition but merely a kind of approximation to the sort of proceeding which is probably pointed to by the terms of the rule'."
At [48] Peter Lyons J continued his discussion of the point:
"The reference to 'a step required by the rules' in statements identifying a step in the action may be traced back to the statement of Maugham J in Mundy. I have already pointed out that the statement was not intended as a definition. Although this description has been used to determine whether a particular action was a proceeding in the action, it seems to me that under r 389, an event may be a step in the action, notwithstanding that it is not required by the rules. For example, the filing and service of a reply (or, for that matter, a subsequent pleading) is not required by the rules; but it seems to me that this would amount to a step in the action. Moreover, r 389(3)[3] shows that an application on which an order is made is a step in the proceeding." [My footnote]
[3] This subrule provides that an application in which no order has been made is not taken to be a step. Accordingly, the Queensland rule accords with SCR, r56(1).
Peter Lyons J dissented as to the characterisation of the activity under scrutiny in that case, but the majority (McMurdo P and Fraser JA) did not address the point, and I see nothing in their approach which would suggest disagreement about it: see McMurdo P at [4]; Fraser JA at [8]. Their Honours in the majority took the view that the asserted step did not progress the action towards finalisation.
Further, in Reliable Roof Treatments Pty Ltd v Citra Constructions Pty Ltd [1974] 1 NSWLR 285 at 288, Master Cantor QC held that the delivery by the defendant on the plaintiff of a notice requiring the plaintiff to plead the facts upon which he relied, was a step in the proceeding within the meaning of s6 of the Arbitration Act 1902 (NSW). The delivery of such a notice was a right conferred on the defendant under the Supreme Court Rules 1970 (NSW); it was not a compulsory step.
The proposition that a step is one required by the rules, seems to stem from Mundy's case. It is referred to in Kaats v Caelers noting the qualification in Mundy, and then re-stated without qualification in Burns v Korff and Argo. There are many cases in which the test is formulated without reference to this proposition: see for instance Spincer v Watts (1889) 23 QBD 350; Ives and Barker v Willans [1894] 2 Ch 478; Rideout v Glaxo Group Ltd [1996] 1 Qd R 200 and Smiley v Watson [2002] 1 Qd R 560. All of these cases were considered by Underwood J in Argo, and the point was not argued. I do not think it can be safely concluded that his Honour, when saying that the step must be one "required by the rules", meant "compulsory under the rules". If that is what his Honour intended then I would, with great respect, take the view that it is plainly wrong.
I respectfully agree with Peter Lyons J in Artahs. I take the view that to amount to a step taken in a proceeding, the action need not be one that in the strict sense is required by rules of court, but it is sufficient if it is one provided for in, or contemplated by, those rules.
"Carrying the action forward" – capacity and intention or actual effect?
The next issue is whether the particular activity is judged simply by its actual effect or lack of it. Can it also be judged by its capacity to move the action forward, an aspect of which is its purpose or the intention with which it was done? It has been said that "a test commonly applied" is whether the activity moves the the matter towards judgment or relief sought: Smiley v Watson (above) at 564. That implies that the requirement is one of fact. An example of this approach is Artahs (above). In that case a timetable for doing certain things was ordered with the consent of the parties following a court initiated "case flow management intervention notice". It was held that the order was not a step taken in a proceeding "because … the order itself did not progress the action towards finalisation, even though subsequent compliance with the order would have progressed the action": McMurdo P at [4]; Fraser JA at [8]. Rule 56(1) itself refers to a step not having been taken in a proceeding. Further, the rule excludes from consideration as a step, an application on which no order has been made.
Ordinarily, the effect of an activity said to amount to a step in a proceeding is readily ascertainable. That is not so with mediations which, assuming the action is not settled, may not have the obvious effect of having moved the action forward, and what may have been achieved is not capable of being assessed. This is because of the nature of mediations and their legislative framework. The purpose of mediation is shown by r519(1) of the SCR, which provides as follows:
"519 Conduct of mediation
(1) The function of a mediator is to assist the parties –
(a)to reach a mutually agreed resolution of their differences; or
(b)if that is not possible, to resolve as many differences as possible."
Mediations may fail to resolve the action or differences between the parties, but the parties may gain a better understanding of their strengths and weaknesses, and respond in some way in the progression of the litigation. Differences which are resolved may not be formally reflected in the subsequent shape of the proceedings, as would occur with, for instance, the resolution of liability. The difficulty arises in the form of s10(4) of the Alternative Dispute Resolution Act which makes inadmissible evidence of anything said or of any admission made in a mediation. What was resolved or achieved at a mediation may not ascertainable. (Section 131(1)(a) of the Evidence Act 2001 also prevents, except in certain circumstances, evidence of a communication made between persons in dispute in connection with an attempt to negotiate a settlement of the dispute.)
As to what is a step in a proceeding, it is a little difficult to discern a definitive test which has universal application, although the general thrust of the various statements is plain enough. In my view there is clear room for the proposition that an activity may be a step even though it has not in fact carried the action forward, provided that it is done with that intention. Obviously, at the very least, an activity must have the capacity to carry the action forward. Phrases used in the authorities, and which are suggestive of that approach, include:
· taking any proceeding "with a view to continuing the litigation …": Spincerv Watts (above) at 353;
· "a proceeding designed to further prosecute the action or in any way to continue the action towards judgment …": Leach v International Portion Foods Pty Ltd [1984] 2 Qd R 152 at 154;
· "some step … taken with a view to continuing litigation between the parties; …": Rideout v Glaxo Group Ltd (above) at 206 – 207.
· "some step … to carry the action forward"; "an action … to prosecute an action to judgment": Argo (above) at 77 [27]; 78 [30].
In B C Cairns, Australian Civil Procedure, 9th ed (2011) at 111 [2.150], the author says, in apparent reliance on the Citicorp case, that "[t]o be a step the act must carry the proceeding forward, it must be something intended to continue the litigation. Acts done only in preparation of a party's case do not qualify as steps." [Emphasis added.] Mr O'Farrell, both in the written outline and in oral argument, took the same approach and accepted the proposition that intention was an aspect of the test. I do not, however, suggest that on the basis of mere purpose or intention alone, an activity would amount to a step in a proceeding.
I take the view that the activity must be one which is at least capable of carrying the action forward and one which is done with that intention. This accords with the authorities to which I have just referred. In particular, it accords with the proposition that a dismissed application may nevertheless advance an action towards judgment; see Burns v Korff (above) at 208, endorsed by Underwood J in Argo.
Can mediation carry an action forward?
The next issue follows on from the last one. It is whether, as argued by the appellant, mediation cannot amount to a step taken in a proceeding, because it is not capable of advancing the action towards judgment; it is designed to bring the action to an end. For this particular point the appellant refers to Argo at 77 [27], where Underwood J held that an application to strike out a statement of claim for want of prosecution was not a proceeding, "for it is a means of getting rid of an action, not a step forward to its conclusion". The appellant also relies on another judgment of Master Lee referred to by his Honour: Bain Dawes (Qld) Pty Ltd v Hill, Supreme Court of Queensland unreported 27 June 1986; (another judgment from which his Honour said he derived considerable assistance). The particular passage from Bain Dawes is set out at 76 [24] of Argo. Master Lee said:
"Various cases suggest that these words [a strictly 'formal' step 'required' by the rules] do not necessarily always require a literal compliance with the precise terms and procedures formally laid down in the rules but rather point to the 'step taken in prosecution of the action' in the sense that it is the results rather than the means by which it has been brought about" [Original emphasis].
To deal with the Bain Dawes point first, I need to point out the context in which both Master Lee and Underwood J were speaking. The issue which Underwood J was considering was whether to be a step taken in a proceeding, it needed to be a formal step. At 76 [24] of Argo, his Honour noted Master Lee's reference to "the modern trend to prosecute litigation by compliance with the rules in an informal manner" and then set out the passage from Bain Dawes reproduced above. Those comments undoubtedly led Underwood J to including in his formulation of the meaning of "step in a proceeding", the proposition that the step need not necessarily be carried out in accordance with the rules. Whilst it is true, as shown in the earlier discussion, that the effect or impact of the activity needs to be assessed, I do not see that the reference to the focus on the result rather than the means, has any significance to the present issue.
As to that issue, I do not think that simply because a mediation might bring about a finalisation of the action by way of a consent judgment or otherwise, it means that it would not qualify as a step taken in a proceeding. There is authority for the proposition that the entry of judgment itself is a proceeding in the relevant sense. In Webster v Myer (1884) 14 QBD 231, the Court was dealing with the equivalent of O79, r11 of the Rules of the Supreme Court 1965 which, by virtue of the decision in Argo, is taken to be to the same effect as r56. The question was whether, service having been effected and no appearance entered, a notice of intention to proceed by way of the entry of default judgment was necessary. At 233 Brett MR said (Lindley LJ agreeing) that "the entry of judgment is clearly a 'proceeding' in an action". That the entry of judgment itself qualifies as a step taken in a proceeding, tends to show that the appellant is not on strong ground with this point.
The real point of distinction between the unsuccessful application to strike out for want of prosecution considered in Argo, and a mediation, is that in the former case the sole purpose of the application was to terminate the action. In contrast, as is shown by r519 (1), the finalisation or termination of an action is only one of the purposes of mediation, albeit a significant one. In my view, the fact that mediation might see the finalisation of the action, does not make it incapable of amounting to a step taken in a proceeding.
Resolution
At least as a starting point of some significance, is the proposition that court ordered mediation is part of this Court's procedures, and becomes part of a particular proceeding. In Newcastle City Council v Wieland (2009) 74 NSWLR 173, the Court of Appeal was required to decide the point in relation to the scheme in New South Wales. Section 26 of the Civil Procedure Act 2005 (NSW) is in similar terms to s5 of the Alternative Dispute Resolution Act 2001 (Tas). Section 28 of the New South Wales Act provided that the costs of mediation were payable, if the court made an order, by one or more of the parties in such manner as specified; or in any other case, by the parties in such proportion as they may agree among themselves.
In a District Court action for damages, mediation was ordered by the court with the consent of the parties. The action settled shortly after the mediation. Consent orders were made which included an order that the defendant pay one-half of the plaintiffs' costs of the proceedings. The parties could not agree about costs. The plaintiffs, who were the respondents in the appeal, lodged a bill of costs. The appellants objected to the costs of the mediation on the basis that there was no court order, and the parties did not agree that the costs of the mediation would be costs in the proceedings. Rule 42.7 of the Uniform Civil Procedure Rules 2005 (NSW), (UCPR), provided that unless the court ordered otherwise, the costs of any application or other step in any proceedings, were to be paid and otherwise dealt with in the same way as the general costs of the proceedings.
The Court of Appeal had to determine whether the expression "costs of the proceedings" in the consent order, included the costs of the mediation. Ipp JA (with whom Beazley and Hodgson JJA agreed), first considered the question of whether the mediation was part of the court's proceedings; "that is, the legal proceedings in the District Court commenced by the respondents … ". His Honour considered the mediation provisions of the Civil Procedure Act (NSW), which included provisions similar to ss8, 10, 11 and 12 of the Alternative Dispute Resolution Act (Tas). After also noting that the mediation was conducted by a court appointed mediator, His Honour said that "it is not possible to conclude that the mediation did not form part of the court's procedures (sic)." See 176 – 177, [24] – [29]. In my view, because of the similarities in the legislative scheme and the existence of Pt 20 of the SCR, that statement should be applied to court ordered mediations in this jurisdiction.
Further, in relation to question of whether the costs of mediation were costs in the proceedings, Ipp JA said at 178 [36] that the broad terms of r42.7(1) of the UCPR must mean that a "step in any proceedings" included mediation within the meaning of s28 of the Act. His Honour said that r42.7, when read with the general power to order costs afforded by the Act, included a power to award the costs of mediation under s28. "That is to say, as ordinarily understood, the costs of proceedings under r42.7 of the UCPR include the costs of mediation." Accordingly, a court order that a party pay the costs of the proceedings would include the costs of mediation.
Of course, the conclusion that court ordered mediation was a "step in any proceedings" was taken in relation to a rule quite different in context to the one presently being considered. Of itself, the conclusion may not have any particular significance. Nonetheless, it is of some interest. It raises consideration of s7(2) of the Alternative Dispute Resolution Act which, as previously noted, makes the costs of a party of a mediation, costs in that party's cause unless otherwise ordered or agreed. A party's costs in the cause may well include things which would not amount to steps taken in the proceeding under r56, but specifically making a party's costs of mediation costs in that party's cause might suggests that such costs are seen as necessary or proper for the attainment of justice.
More generally, the place of mediations in modern litigation was alluded to by Olney J in Re Microbio Resources Inc v Betatene Ltd [1992] FCA 332. In the proceedings, Northrop J had made orders that the applicant provide security for costs incurred and to be incurred to the completion of mediation proceedings before the Registrar, and that failure to comply with the order to provide security within the time limited or further order, would result in the proceedings being stayed. Northrop J had also made concurrent orders that the matter be referred to mediation. The applicant did not provide security within the time specified. Olney J was dealing with the respondent's motion seeking the dismissal of the application. His Honour dismissed the respondent's motion, but went on to consider what should be done with the application
At [10], Olney J said:
"It is clear from reading Northrop J's reasons, and the transcript of the proceedings on 1 June 1992, that his Honour considered that mediation was an appropriate step to be taken if not to settle the proceedings, at least to assist the parties to confine the issues to be litigated. … The security ordered is expressed to be security for costs incurred and to be incurred by the respondents down to the completion of the mediation proceedings before the Registrar. It would not in my view be inconsistent with what Northrop J contemplated if the order for security were amended so as to extend the time for the provision of security to a date beyond the completion of the mediation process so as to permit that vital step in the proceedings to be taken. Once that has been achieved it may be that other matters will need to be considered, particularly if the applicant is still unable to provide the required security." [My emphasis]
I do not suggest that the reference to "step in the proceedings" has any direct impact on the determination of the issue before me. His Honour's comments however, clearly indicate the view he took of the part mediation has to play in the advancement of litigation.
I also note an observation in Porzuczek v Toowoomba District Health Services [2007] QSC 177. In that case, Moynihan J dealt with a defendant's application to dismiss the plaintiff's action for want of prosecution, together with the plaintiff's application filed in response for leave to take a new step in the proceedings. The rules provided that a plaintiff who had not taken a step in a proceeding for two years, could not take a further step without leave. There was debate about when the last step had been taken, with the focus of attention being on whether the provision of copies of medical reports amounted to production for inspection of documents, and hence a step in the proceeding. At [13] his Honour said:
"The defendant submits that when the notice of intention to proceed was delivered, it had already been three years after any prior 'step' had taken place, namely the mediation in which the parties participated on 1 April 1999. As such, the plaintiff required leave to take the further 'step' in the 'proceeding' constituted by the disclosure of the report. " [My emphasis.]
The point about whether the mediation amounted to a step in the proceeding does not seem to have been the subject of any argument. It seems to have been assumed by the parties, as well as by Moynihan J, that it did.
In my view grounds (i) and (ii) should fail. I confine my remarks to mediation ordered by the court, with or without the consent of the parties. Assisted by the authorities which I have just mentioned, I conclude that a such a court ordered mediation conference amounts to a step taken in a proceeding. At the least, the activity shows that the action is alive. I have already mentioned things which may be achieved at a mediation other than the settlement of the action. Mediation may cause changes in the way the parties approach the case. It has the potential to formally resolve such things as liability or quantum, and evidentiary points or similar matters which might be said to impact on a party's case. Further, to adopt the words of Master Lee in Burns v Korff (above) referring to a dismissed application, a mediation which has not finally resolved the action may advance the cause towards ultimate judgment in favour of one party or the other. Although under r518(3) an order for mediation does not operate as a stay of proceedings, the completion of court ordered mediation which has been unsuccessful or partially successful, may remove a possible impediment to having the matter listed for trial, or at least the commencement of the trial.
Grounds (iii) and (iv) – the mediation on 28 February 2007
Ground (iii) attacks the inference drawn by the Associate Judge that, from the nature of such conferences, settlement was discussed at the mediation conference. His Honour said there was no suggestion that the parties, through their solicitors, did not discuss the possibility of settlement. Although the ground is part of the attack on the Associate Judge's reasoning based on the compulsory conference provisions of Pt 22, Div 1 of the SCR, the point has has a wider application in the appeal.
Neither party put before the Associate Judge, or sought to put before me, any evidence about whether or not settlement of the action, or any aspect of it, was or was not discussed. Such general evidence would not seem to be made inadmissible by s10(4) of the Alternative Dispute Resolution Act or by s131(1)(a) of the Evidence Act, referred to above. Evidence that the parties did not embark on any discussions to reach a mutually agreed resolution of their differences, or to resolve as many differences as possible, would not be evidence of anything said or of any admission made in a mediation. Similarly, such evidence would not be evidence of a communication made between persons in dispute in connection with an attempt to negotiate a settlement of the dispute within the meaning of s131(1) of the Evidence Act. (See GPI Leisure Corporation Ltd (in liq) v Yuill (1997) 42 NSWLR 225 at 226 where Young J said that he was inclined to the view that the connection referred to in s131(1)(a) was a direct connection.)
In this case, the appellant applied for a stay of proceedings, and he bore the onus of establishing the basis for the making of that order. The undisputed material before the Associate Judge was that the lawyers for the appellant and the respondent were with the mediator for one hour. The Registrar noted in the letters setting the dates, that Part 20 of the Rules provided that each party was to attend the mediation with authority to settle. (Rule 519(3) so provides, "unless otherwise ordered or agreed".) The Associate Judge noted that there was no suggestion that the parties, through their solicitors, did not discuss the possibility of settlement, and inferred from the nature of such conferences that settlement was discussed. On the material before him, which included the Court's record of settlement conference, that inference was plainly open. There is no basis for thinking that what took place was anything other than a mediation conference. Ground (iii) is not made out.
As to ground (iv), the appellant submits that the Associate Judge's reasoning was unsound, complaining that it was wrongly based on the compulsory conference and certificate of readiness provisions in Pt 22, Div 1 of the SCR. The Associate Judge took the view that as those rules required the party to conduct settlement negotiations as a prerequisite to the action being set down for trial, any such discussions amounted to a step required by the rules to carry the action forward to a final judgment. As it was put by Mr O'Farrell, reduced to a syllogism, the flawed reasoning process can be expressed as follows:
· in personal injuries actions it is part of a compulsory conference process to require settlement discussions as a step towards trial;
· settlement is discussed at mediation;
· mediation is a step towards trial.
The respondent submits that the significance of the compulsory conference and certificate of readiness procedures is by way of analogy. A compulsory conference under the Queensland rules of court similar to Pt 22, Div 1 of the SCR, has been held to be a "proceeding" for the purposes of the r56 equivalent: Russell v Mihaljevic, Full Court of the Supreme Court of Queensland, unreported 24 June 1982. Kelly J (D M Campbell and Dunn JJ agreeing) relied on Kaats v Caelers (above).
The respondent further submits that if a compulsory conference is a step in a proceeding, then a court ordered mediation, even one sought by consent, would similarly be a step in a proceeding. The underlying objectives are the same, at least in part so far as the compulsory conference is concerned. This argument is separate from an argument that a mediation may in fact qualify and be treated by the parties as the required discussion of the possibility of the settlement of the action under SCR, r541(1). Mr Browne acknowledged the valid distinction between the compulsory conference and the discretionary court ordered mediation, but relies on the proposition that to qualify as a step in a proceeding, the step need not be one which is strictly required by the rules.
With respect to the Associate Judge, I accept the appellant's argument that the reasoning process based on the compulsory conference provisions is unsound. I do not think it can be properly said that because settlement is discussed at a mediation, and r541(1) requires the discussion of the possibility of the settlement of the action, that mediation thereby becomes "a step required by the rules to carry the action forward to a final judgment". I do however, consider that settlement discussions at a mediation may, depending on the circumstances, satisfy the requirement under r541(1)(b). Depending on the time which has elapsed between the mediation and the compulsory conference, and what changes may have been made to the shape of the litigation, the parties could properly treat a mediation as satisfying the requirement of the rule. That is a relevant consideration in determining the point of principle raised by grounds (i) and (ii).
Although I would uphold ground (iv), for the reasons which I have given in relation to grounds (i), (ii) and (iii), the ultimate conclusion that the mediation conference on 28 February 2007 amounted to a step in the proceeding, was the correct one.
Outcome
As the appeal has no prospects of success, it is unnecessary for me to consider the further issue argued by the respondent in relation to the appellant's application to extend time, although I will mention it. The respondent argued that he was prejudiced by the failure to properly institute the appeal, because he had taken further steps in the proceeding, and had done other things to advance the litigation. I need only say that despite the notice of appeal not being served until after the time for instituting the appeal had expired, the respondent's solicitors were told on the day after the appeal was filed, that it had been filed. But for the lack of merits of the appeal, I would grant the application. Because of my view about the appeal, the application is dismissed.
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