Corporate Sports and Entertainment Group v Morris and
[2011] VCC 684
•24 June 2011
| IN THE COUNTY COURT OF VICTORIA | Not Restricted |
| AT MELBOURNE CIVIL DIVISION COMMERCIAL LIST GENERAL DIVISION |
Case No. CI-02-05714
| CORPORATE SPORTS AND ENTERTAINMENT GROUP PTY LTD | Plaintiff |
| v | |
| JANICE MORRIS | First Defendant |
| and | |
| CASTLE HOLDINGS PTY LTD | Second Defendant |
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| JUDGE: | HIS HONOUR JUDGE GINNANE |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | 15 and 16 March 2011 |
| DATE OF JUDGMENT: | 24 June 2011 |
| CASE MAY BE CITED AS: | Corporate Sports and Entertainment Group v Morris and Castle Holdings Pty Ltd |
| MEDIUM NEUTRAL CITATION: | [2011] VCC 684 |
REASONS FOR JUDGMENT
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Catchwords: PRACTICE and PROCEDURE – non-existent corporate plaintiff – application to substitute corporation – whether proceedings a nullity – whether discretion to substitute different corporation as plaintiff – application granted: County Court Civil Procedure Rules 2008, 0 36, r1 and 4.
Dismissal for want of prosecution – proceeding commenced in 2002 – inordinate delay – whether an adequate excuse – whether a fair trial could be held – proceeding dismissed.
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| APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr R H Smith SC and | Browne & Co |
| Mr JG Pennell | ||
| For the Defendants | Mr M J Cosgrave SC and | Roger Yelland & Co |
| Mr M J Biviano | ||
| HIS HONOUR: |
1 The defendants, Ms Janice Morris and Castle Holdings Pty Ltd, by Summons issued on 28 July 2010, seek to dismiss the proceeding because the entity named as plaintiff does not exist and therefore cannot bring this proceeding. Alternatively, they apply to dismiss this proceeding, which was commenced in 2002, for want of prosecution.
2 The plaintiff, Corporate Sports and Entertainment Group Pty Ltd, by Summons issued on 20 January 2011, seeks to amend the name of the plaintiff to “Corporate Sports and Entertainment Pty Ltd (ACN 075 418 567)”. Evidence before the Court establishes that in fact the name of the company, which is the subject of the plaintiff’s amendment application, is “Corporate Sports & Entertainment Pty Ltd” – i.e., with an ampersand rather than the conjunction “and”. I will treat the plaintiff’s application as to amend the plaintiff’s name to “Corporate Sports & Entertainment Pty Ltd”.
3 A large number of affidavits were filed in connection with the Summons, mainly by the respective solicitors and by directors of the plaintiff and second defendant.
4 I have decided that leave should be given to amend the name of the plaintiff, but that the proceedings should be dismissed for want of prosecution.
5 Corporate Sports & Entertainment Pty Ltd conducts the business of arranging sports and entertainment packages at football matches, horse racing and similar events. The plaintiff alleges that the first defendant, Ms Morris, was engaged through the second defendant, Castle Holdings Pty Ltd, to be its sales and marketing consultant between 1999 and 16 November 2001. It alleges that they breached contractual, fiduciary and statutory duties by misusing confidential information in a competing business, which she had established, whilst working for the plaintiff or shortly thereafter.
6 As stated, no legal entity bearing the name of the plaintiff has ever existed. A company named Corporate Sports & Entertainment Pty Ltd was incorporated in 1996. A business name, Corporate Sports and Entertainment Group, was registered under the Business Names Act 1962 between 1994 and 2000 by Mr R De La Rue, who is a director of Corporate Sports & Entertainment Pty Ltd, first in conjunction with Mr F Davis and after 1998, on his own behalf.
7 In July 2010, the newly appointed solicitor for the defendants discovered that the plaintiff did not exist and applied to have the proceeding dismissed.
The Plaintiff’s Case
8 In a little further detail, the plaintiff’s case alleges that Ms Morris, whilst still employed, wrongly removed documents and customer lists, or copies thereof, or committed them to memory, or subsequently converted or detained them. It is also alleged that the defendants wrongly used the information and documents to establish a business competing with the plaintiff’s, e.g. by soliciting the plaintiff’s clients and by copying sporting fixtures which had been prepared by the plaintiff. The plaintiff’s affidavits allege that Ms Morris misled the plaintiff as to her future business intentions and solicited clients of the plaintiff while working for it. Almost immediately after leaving the plaintiff, she registered the business name, Condor Corporate Leisure.
The Defendants’ Defences
9 The defendants do not admit the incorporation or the nature of the plaintiff’s business and deny its allegations.
Application to Amend the Name of the Plaintiff
10 I will deal first with the plaintiff’s application to amend its name. If this application is not successful, then the defendants would be entitled to an order that the proceeding be dismissed, regardless of the outcome of the application to dismiss it for want of prosecution.
11 The first issue is whether the Court has power to order an amendment which will substitute a new plaintiff when the entity named as plaintiff does not exist. If the Court does have that power or discretion, the second issue is whether the Court should exercise it by granting the application.
12 The plaintiff made its application under Rule 36.01 and 36.04 of the County Court Civil Procedure Rules 2008 which state:
“(1) For the purpose of –
(a) determining the real question in controversy between the parties to any proceeding; or (b) correcting any defect or error in any proceeding; or (c) avoiding multiplicity of proceedings – the Court may, at any stage, order that any document in the proceeding be amended or that any party have leave to amend any document in the proceeding. … (4) A mistake in the name of a party may be corrected under paragraph (1), whether or not the effect is to substitute another person as a party.”
13 The defendants submitted that Rule 36 could not be relied on, as a proceeding by a non-existent person or corporation was a nullity. A proceeding which is a nullity cannot be cured by the exercise of the Court’s power to add or substitute a party. It was incurably bad. No subsequent step or order in the proceeding could have any validity.[1]
[1] Citing Hubbard Association of Scientologists International v Anderson & Just (No 2) [1972] VR 577, 579
14 The principal authority relied on by the plaintiff was the English Court of Appeal decision, International Bulk Shipping and Services Ltd v Minerals and Metals Trading Corp of India.[2] That authority has been applied in a number of Australian cases.[3] The plaintiff also relied on the High Court’s judgment in Bridge Shipping Pty Ltd v Grand Shipping SA.[4] In that case, a defendant had issued a third party notice against the registered owner of a vessel on which its goods were being carried, whilst they were damaged. In fact the vessel had been under charter to another company, which therefore had been the carrier of the goods. The Court held that the defendant had not made a mistake “in the name of a party” within the equivalent of sub-rule (4), because it had intended to sue the owner of the vessel, believing that its right of action lay against it. The effect of the judgments of four members of the Court, Brennan, Deane, Toohey and McHugh JJ,[5] was that the equivalent of Rule
36. 01(4) covers: “… not only cases of misnomer, clerical error and misdescription but also cases where the plaintiff, intending to sue a person he or she identifies by a particular description, was mistaken as to the name of the person who answered that description.”[6]
[2] [1996] 1 All ER 1017, 1023
[3] See Marshall v D G Sundin & Co Pty Ltd (1989) 16 NSW LR 463,471; Laing v State of Victoria [2005] FCA 791 [41]; Immer v Girotto Precast Pty Ltd [2009] NSWSC 1019 [ 6]; Deveigne v Askar (2007) 69 NSW LR 327 [12], [104-114], [127-8], [172]; and Woodings v Stevenson [2001] WASC 174
[4] (1991) 173 CLR 231
[5] Brennan J and Deane J agreed in the judgment of McHugh J, Toohey J and Dawson J delivered separate judgments.
[6] taken from the head note
15 McHugh J stated that:
“Rule 36.01(4) is a remedial rule and should be given a beneficial interpretation. It is proper to give it the widest interpretation which its language will permit. It should be interpreted to cover not only cases of misnomer, clerical error and misdescription but also cases where the plaintiff, intending to sue a person he or she identifies by a particular description, was mistaken as to the name of the person who answers that description … .” [7]
[7] at pages 260-261
16 Dawson J distinguished between a mistake in name, which could be corrected under Rule 36.01(4) and a mistake in identity, which could not be so corrected.[8]
[8] at page 245
17 The plaintiff also relied on the decision of Walsh J, in Rainbow Spray Irrigation Pty Ltd v Hoette,[9] which in turn was referred to with apparent approval in Bridge Shipping. Walsh J stated:
“If this case ought to be regarded truly as the substituting for one plaintiff of another plaintiff, then I think on the authorities, I would be bound to refuse it, but it is not clear that it ought to be so regarded. …
…
I think I am entitled, in the circumstances of this case, to treat this as a case of correcting an error in naming the true plaintiff, and not as being an attempt to substitute one party for a different party. To put it another way, I think it can be said that one ought to consider the action, from the time of writ onwards, to have been and to have been intended an action by Rainbow Spray Sales Pty Limited, but because of someone’s error the wrong name was typed on the document.”
[9] [1963] NSWR 1440 at 1441
18 The name typed on the document, i.e the writ and subsequent documents on the Court record, was “Rainbow Spray Irrigation Pty Ltd”.
19 The defendants submitted that the principle stated in the Rainbow Spray Irrigation Case applied only when the plaintiff initially named in the proceeding existed and this was not such a case.
Was there a Mistake in the Name of the Plaintiff?
20 Mr R De La Rue, the sole director and shareholder of Corporate Sports & Entertainment Pty Ltd, swore that Ms Morris was engaged by Corporate Sports and Entertainment Group. He pointed to the reference to that name in a letter containing the terms of her engagement, in invoices for her services sent by the second defendant, Castle Holdings Pty Ltd, and in her letter of resignation. That letter includes the following sentence:
“This timing should enable me to satisfactorily complete Spring Racing commitments and allow a good lead in period for a new employee to maintain and develop ongoing business with the clientele I am proud of introducing to Corporate Sports and Entertainment Group.”
21 Mr De La Rue stated that that the letterheads of the trading name Corporate Sports & Entertainment Group – using an ampersand rather than a conjunction – identified that Corporate Sports & Entertainment Pty Ltd was the registered owner of that business name. Ms Morris would have signed more than one thousand letters using that letterhead.
22 In fact, the registered business name was Corporate Sports and Entertainment Group.
23 Mr De La Rue also referred to the Magistrates’ Court proceeding commenced by Ms Morris against Corporate Sports & Entertainment Pty Ltd in 2005 as indicating that she was aware of the identity of the corporation behind Corporate Sports and Entertainment Group. That proceeding was brought under the Instruments Act 1958 on a cheque issued to Castle Holdings Pty Ltd in November 2001 for Ms Morris’ final entitlements. It was transferred to this Court to be listed together with this proceeding, but was struck out in 2007.
24 Mr De La Rue stated that the name Corporate Sports and Entertainment Group was not transferred to Corporate Sports and Entertainment Pty Ltd. He and Mr Davis “simply agreed that, as co-directors and co-shareholders of CSE, CSE could trade under the business name”. The use of CSE on this occasion appears to have been intended to be a reference to Corporate Sports and Entertainment Pty Ltd. Mr Davis relinquished his ownership of the business name in 1998. Mr De La Rue stated that:
“I did not bother renewing the registration of the business name after 3
March 2000 because I was happy to have CSE trading under thatbusiness name without registration, which I regarded as unnecessary.”[10][10] Affidavit of Raymond John De La Rue, 15 December 2010, paragraph 20
25 This position ignored the requirements of the Business Names Act 1962,[11] but no submissions were made about that point.
[11] See s.5 and s14
26 Mr Yelland, the solicitor for the defendants since 28 April 2010, swore three affidavits in which he contended that the application to amend the name of the plaintiff was essentially an application to substitute a new party as the plaintiff to the proceeding.
27 Ms Morris, in her second affidavit, disputed that she had entered into a contract or signed any employment agreement with Corporate Sports and Entertainment Pty Ltd. She denied that she was aware that Corporate Sports and Entertainment Pty Ltd was the owner or operator of the Corporate Sports Group business, or trading as Corporate Sports and Entertainment Group at relevant times. She understood that her work was being provided for Corporate Sports and Entertainment Group, which was owned by Mr De La Rue. She stated that the business had signs at the premises with the name “Corporate Sports and Entertainment” and that it was known by that name. She had business cards which showed that she was providing services to Corporate Sports and Entertainment Group.
Conclusion
28 The authorities place importance on identifying the person who was intended to be the plaintiff.
29 The evidence establishes that the intended plaintiff was the company that had contracted with Castle Holdings Pty Ltd to provide it with the services of Ms Morris. That company was Corporate Sports & Entertainment Pty Ltd. A mistake was made in describing the plaintiff. There is no other company than Corporate Sports & Entertainment Pty Ltd, which might have been the appropriate plaintiff.
30 The question of whether Ms Morris was informed, or knew that Corporate Sports & Entertainment Pty Ltd was her employer, or the entity for whom she was working, is not a matter of direct relevance to this application. It may well be a matter giving rise to a defence. Rather, the question to be determined is: on whose behalf was this action intended to be commenced? Clearly not on behalf of a company that did not exist. The only company on whose behalf it could have been intended to be commenced was Corporate Sports & Entertainment Pty Ltd. The other company mentioned in Mr Yelland’s affidavits, with which Mr De La Rue had an association, has no relevance to this proceeding.
31 There remains the issue of whether, in light of that finding, it is appropriate to exercise the discretion conferred by Rule 36. The defendants submitted that the principles relevant to the application to dismiss the proceeding for want of prosecution were equally applicable to the exercise of the discretion conferred by Rule 36. The plaintiff did not agree with that, and submitted that of most relevance was the fact that the plaintiff had been named as a mistake, that there was no strategy to avoid naming the correct plaintiff and that the defendants were never confused about the fact that the entity intending to sue was the entity which had contracted with Castle Holdings Pty Ltd for the provision of Ms Morris’ services.
32 If I grant the application, a defence currently available to the defendants is removed. However, the removal of a defence will often be the consequence of allowing amendments, either to the substance of a pleading or to the name of the party. That consequence is, by itself, not a ground for refusing the application.
33 Apart from that matter, there is no other relevant prejudice to the defendants in granting the application to substitute the new plaintiff. Until July 2010 no one identified that the plaintiff did not exist. The point was not raised in the Defences delivered by the defendants. The issue of the late point at which the application is made does not, by itself, indicate prejudice to the defendants. The question of delay is, of course, relevant to the later question of dismissal for want of prosecution.
34 In an application by the defendants before Judge Holt on 21 June 2007, his Honour was informed by the defendants that the plaintiff had been deregistered on 20 January 2006 and had ceased to exist. His Honour vacated the fifth trial date and adjourned the defendants’ summons. In fact the company deregistered was Corporate Sports & Entertainment Pty Ltd. This confusion confirms that the defendants shared in the misapprehension of who the plaintiff was.
35 I consider that it is an appropriate exercise of discretion to order that the plaintiff’s name be amended to Corporate Sports & Entertainment Pty Ltd and that the title of the proceedings be amended accordingly.
The Defendants’ Application to Dismiss the Proceeding for Want of Prosecution
36 The order for the amendment of the plaintiff’s name does not determine the question of whether the proceeding should be dismissed for want of prosecution.
37 The proceeding has been on foot for eight and a half years. It was commenced in October 2002 and concerns events commencing in late 2001.
38 The parties agreed that the principles relevant to the determining whether to dismiss a proceeding for want of prosecution were contained in the House of Lords decision of Department of Transport v Chris Smaller (Transport) Ltd,[12] and were :
[12] [1989] AC 1197, 1203, per Lord Griffiths
“The power should be exercised only where the court is satisfied either:
(1) the default has been intentional and contumelious, eg disobedience to 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 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 such as is likely to cause to have caused serious prejudice to the defendants, either as between themselves and the plaintiffs, or between each other, or between them and a third party.”
39 This statement of principle has been applied by the Full Court of the Supreme Court of Victoria and the Victorian Court of Appeal.[13]
[13] See Bishopsgate Insurance Australia Ltd (in liq) v Deloitte Haskins & Sells [1999] 3 VR 863, 872 [24- 25] and 879 [40] and by the Court of Appeal in Masel & Ors v Transport Industries Co Ltd & Ors [1995] 2 VR 328, 332 (lines 1-15), 336 (lines 4-8) and Spitfire Nominees Pty Ltd & Anor v Ducco (1998) 1 VR 242, 246 (lines 1-30).
40 The parties did not suggest that I should attempt to form a view of the prospects of the plaintiff’s claim succeeding. In any event, although there were some passages in the affidavits which addressed that question, they did not provide a basis for reaching any view about the likely outcome of the litigation.
41 The three questions of particular relevance to this application are:
(a) first, has there been inordinate delay by the plaintiff in the conduct of the litigation? (b) second, whether that delay has been inexcusable; (c) third, whether the delay gives 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. 42 In addition, before dismissing the proceeding, the Court has to be satisfied that the justice of the case requires that step.[14] In Masel v Transport Industries Insurance Co Ltd[15] the Court stated that even inordinate and inexcusable delay by the plaintiff resulting in serious prejudice to the defendant (including the risk of an unfair trial) would not in all circumstances require the action to be dismissed for want of prosecution, although the cases in which that would be the case would be rare. Delay is relative, to be seen in context with such matters as the conduct of the defendant in the litigation, the complexity of the matters in issue and delay caused by the processes of the court.
[14] See Masel & Ors v Transport Industries Insurance Co Ltd & Ors (supra) esp. at 335-336
[15] supra at 345
Chronology
43 I will set out the chronology in detail to give context to the arguments put by the parties. The length of this chronology reflects the time that the proceeding has taken.
44 The plaintiff blames the defendants for not allowing the completion of inspection and avoiding disclosing discoverable documents as evidenced by the fact that they have made three affidavits of documents. The defendants blame the plaintiff for not providing comprehensive discovery and particulars of its claim.
45 The main events of relevance in this litigation have been as follows:
2002
46 The plaintiff commenced the proceeding on 7 October 2002.
2003
47 On 7 April 2003, directions were given and a trial was fixed for 18 February 2004.
48 On 11 December 2003, after the defendants had issued a Summons to strike out parts of the Amended Statement of Claim, to obtain further particulars and further discovery, orders by consent were made adjourning the defendants’ Summons to a date to be fixed and the plaintiff ordered to pay the defendants’ costs of the day. The trial date of February 2004 was vacated.
2004
49 On 5 April 2004, the proceeding was struck out for non-attendance of both parties at a directions hearing. It was later reinstated and further directions given.
50 On 22 June 2004, a directions hearing was held and directions given for the filing of amended pleadings.
51 On 20 July 2004 the plaintiff delivered a further amended statement of claim.
52 On 3 August 2004, the defendants served a Request for Further and Better Particulars of the Further Amended Statement of Claim.
53 On 7 September 2004, the Court made directions by consent, including the provision of further particulars, experts’ reports and the fixing of a new trial date of 13 April 2005.
54 On 24 November 2004, the plaintiff served Further and Better Particulars. Correspondence followed as to their adequacy.
2005
55 On 4 March 2005, the April 2005 trial date was vacated by consent, because the provision of particulars revealed a need to amend the pleadings.
56 On 31 March 2005, the plaintiff’s solicitors wrote to the defendants’ solicitors about a number of matters, including a schedule of documents for discovery that they had sent previously, and seeking any request for particulars that the defendants proposed to make.
57 On 3 May 2005, the Court made further directions, including for discovery by the defendants, and fixed a new trial for 24 October 2005.
58 On 1 June 2005, the defendants served an unsworn affidavit of documents in the name of Ms Morris responding to the plaintiff’s schedule of documents and stating that she believed that her diary for 2000 was left at the plaintiff’s office when she departed and that she discarded her diary for 2001 at approximately the end of 2002.
59 On 4 June 2005, the defendants’ served an unsworn affidavit of documents.
60 On 4 July 2005, the plaintiff’s solicitors wrote to the defendants’ solicitors asserting that the defendants’ discovery was deficient and seeking an inspection of the documents that had been discovered.
61 On 23 September 2005, the Court vacated the trial date fixed for 24 October 2005. The order does not record why this occurred. A directions hearing was fixed for 6 June 2006.
62 On 11 October 2005, a mediation occurred, but was adjourned to be recommenced on or before 26 June 2007.
63 On 12 October 2005, the plaintiff’s solicitors wrote to the defendants’ solicitors setting out a timetable that had apparently been the subject of previous discussions.
2006
64 On 20 January 2006, Corporate Sports & Entertainment Pty Ltd was deregistered due to omitting to lodge returns following a change of address of its registered office.
65 On 6 June 2006, during the deregistration, the Court ordered the plaintiff to provide further and better particulars and set a fourth trial date of 27 March 2007.
66 On 6 October 2006, the plaintiff’s solicitors wrote to the defendants’ solicitors stating that a lack of proper discovery by the defendants was affecting the plaintiff’s ability to provide further and better particulars.
67 On or about 22 December 2006, the solicitors met and resolved that a new timetable would be agreed, which the plaintiff’s solicitors stated would include “the Defendants providing adequate discovery”.
2007
68 On 15 February 2007, the plaintiff inspected the defendants’ discovered documents.
69 On 26 February 2007, the defendants, by Summons, sought further and better particulars of the plaintiff’s Further Amended Statement of Claim and further and better discovery.
70 On 28 February 2007, the plaintiff’s solicitors wrote to the defendants’ solicitors asserting that adequate particulars had been provided and requesting further discovery. The defendants’ solicitors replied, contesting the suggestion that they had not given adequate discovery.
71 On 1 March 2007, the plaintiff issued a Summons seeking further discovery.
72 On 2 March 2007, the plaintiff served an expert witness statement as to damages calculating the lost “contribution margin” directly attributable to the events promoted or sold by Corporate Sports & Entertainment Group Pty Ltd for the two years subsequent to the departure of Ms Morris as $494,218.80. The report stated that Mr De La Rue had indicated that he was not making any claim in the proceedings for losses beyond October 2003 due to the loss of facilities at the MCG.
73 On 6 March 2007, the Court ordered that the plaintiff make specific discovery and provide inspection and further particulars, in default of which the proceeding would be stayed until further order. The fourth trial date was vacated and the proceeding was fixed for trial on 17 July 2007. The plaintiff was ordered to pay the costs of the defendants’ Summons, and the plaintiff’s Summons was adjourned until 11 April 2007 with costs reserved.
74 On 8 March 2007, the plaintiff’s solicitors wrote to the defendants’ solicitors requesting a time to inspect further the defendants’ discovered documents.
75 By 11 April 2007, the plaintiff had not complied with the orders of 6 March 2007, with the result that the proceeding must be taken to have been stayed.
76 On 18 April 2007, the plaintiff’s Summons seeking further discovery was adjourned by consent to a date to be fixed and the defendants ordered to pay the plaintiff’s costs of the Summons.
77 On 24 April 2007, the plaintiff’s solicitors wrote to the defendants’ solicitors requesting copies of discovered documents and noting that a number of documents had not been discovered.
78 On 31 May 2007, the plaintiff’s solicitors wrote to the defendants’ solicitors requesting a response to the letter of 24 April 2007 and stating that it failed to comply with the order of 6 May 2007 as a “result of an error at our office” and that the order had now been complied with and seeking to resolve the “defendants’ outstanding discovery” and the lifting of the stay between solicitors.
79 On 8 June 2007, the defendants’ solicitors wrote to the plaintiff’s solicitors stating that that the proceeding was stayed and that it was a matter for the plaintiff whether it sought the removal of the stay. The letter also alleged that the plaintiff’s supplementary affidavit of documents was inadequate and stated that –
“… after nearly five years of litigation, the plaintiff still has not provided adequate particulars of the case which the defendants have to meet, the quantum of the plaintiff’s claims, or the calculation of claim losses/profits.”
80 On 21 June 2007, the Court adjourned an application by the defendants to strike out the proceeding, because of inadequate discovery and failure to provide particulars after it was informed the plaintiff was deregistered. In fact, at that point, the proceeding was stayed. As previously stated, the company deregistered was Corporate Sports & Entertainment Pty Ltd. The fifth trial date of 17 July 2007 was vacated.
81 In September 2007, Corporate Sports & Entertainment Pty Ltd was reinstated to the register so that its registration continued as if deregistration had not occurred.
2008
82 On 21 May 2008, the Court, by consent, ordered that the stay of the proceeding be lifted, ordered the plaintiff to provide further discovery and further particulars and to pay the costs of that day and of 21 June 2007. The order recited that the first defendant had agreed to make an affidavit of specific discovery on or before 4 June 2008 and provide for inspection.
83 On 5 June 2008, the plaintiff provided a further affidavit of documents, their third such affidavit, to the defendants.
84 On 24 June 2008, the plaintiff’s Summons filed 18 June 2007 and the defendants’ Summons filed 1 March 2007 were adjourned to 28 July 2008.
85 On 22 July 2008, the defendants’ solicitors conducted an inspection of the plaintiff’s documents and advised the next day that they would arrange further inspection after conferring with counsel.
86 On 4 September 2008, the plaintiff’s solicitors wrote to the defendants’ solicitors stating that they were obtaining dates from their client for the defendants’ further inspection of the plaintiff’s discoverable documents.
2009
87 In January and March 2009, the plaintiff’s solicitors wrote to, and contacted, the defendants’ solicitors suggesting the holding of discussions about the litigation and a case conference. The defendants did not agree with those suggestions.
88 On 29 May 2009, the plaintiff’s solicitors wrote to the defendants’ solicitors stating that they were instructed to have the matter relisted for directions in order to obtain a trial date and suggesting a timetable for directions.
89 On 12 June 2009, the plaintiff applied to have the proceeding relisted.
90 On 31 July 2009, the plaintiff’s solicitors advised the defendants’ solicitors that they could no longer act because of a conflict of interest following the merger of their practice with another firm. They suggested that a mediation might be held within the next four weeks.
91 On 17 August 2009, the defendants’ solicitors replied, stating that the defendants, whose postal address was given, would agree to a resumption of the mediation if the plaintiff complied with discovery, inspection obligations and provided particulars. It was anticipated that the plaintiff would by then have new solicitors but the same counsel.
2010
92 On 16 April 2010, the plaintiff sought to have the proceeding relisted.
93 On 28 April 2010, the defendants’ current solicitors filed a Notice of Change of Practitioner.
94 Following correspondence from the plaintiff’s solicitors, a directions hearing was fixed for 29 April 2010 to set a trial date and interlocutory timetable. That directions hearing was adjourned until 8 July 2010.
95 On 8 July 2010, the Court ordered that any application by the defendants to dismiss the proceeding for want of prosecution be made by 28 July 2010.
96 On 27 July 2010, the defendants applied to dismiss the proceeding because the plaintiff did not exist and for want of prosecution and alternatively, sought security for costs.
97 On 3 September 2010, the hearing of the defendants’ Summons was adjourned by consent until 21 October 2010 and times fixed for the filing of affidavits.
98 On 13 October 2010, the defendants’ Summons was adjourned to a date not before 1 December 2010 and times fixed for the filing of affidavits.
99 On 21 October 2010, a further mediation was conducted.
100 On 2 December 2010, the Court made a default order providing for the dismissal of the proceeding, unless by 16 December 2010, the plaintiff filed any affidavits in response to the defendants’ Summons of 28 July 2010 and paid the defendants’ costs of $5,050 thrown away.
2011
101 On 20 January 2011, the plaintiff filed a Summons seeking to amend the name of the plaintiff.
102 On 7 February 2011, by consent, the hearing of the plaintiff’s and defendants’ Summons was adjourned to 15 March 2011.
103 On 2 March 2011, the plaintiff filed a Summons seeking further and better discovery.
104 The parties’ Summons were heard on 15 and 16 March 2011.
The Defendants’ Submissions
105 The defendants’ summary of the plaintiff’s delay in the litigation was:
“After interlocutory steps were taken, the matter was first set down for a trial to be held in February 2004. Subsequently, the trial date was vacated and the matter was set down for trial again on 4 more occasions and those trial dates vacated each time. Hence, the matter was set down for trial 5 times between early 2004 and mid-2007. During that time, the plaintiff’s proceeding was dismissed for a period for failure to attend a directions hearing and the entity, which is the subject of the amendment application, was deregistered between January 2006 and September 2007. This became apparent in an application before Judge Holt in June 2007. This was around the first time that the defendants applied to strike out the action.
It appears that the plaintiff did nothing between June 2007 and May 2008. Apart from alleging that the defendants’ solicitors had a conflict, the defendants contend that the plaintiff took little or no substantive action between June 2008 and April 2010 to progress the matter, much less to obtain a trial date. Even after the defendants wrote to the plaintiff in July 2010 about the non-existent company and then served their summons and supporting material, it was not until January 2011 that the plaintiff issued a summons to attend the plaintiff’s name.”
106 The defendants point to the likelihood that the proceeding will not be heard until late 2011 or in 2012, ten years after the events in question and seven to eight years after the action could have been heard.
107 The defendants advanced four reasons why the proceeding should be stayed, most of which are contained in the summary of submissions set out above. I will repeat those submissions in summary form:
• First, the trial had been adjourned on five occasions because of the plaintiff’s default; • Secondly, the proceeding was stayed for thirteen months between April 2007 and May 2008 because of the plaintiff’s failure to comply with the Court orders of 6 March 2007; • Thirdly, there was no valid explanation for the delay between July 2008 and April 2010. Even after the defendants wrote to the plaintiff in July 2010 about the non-existence of the plaintiff, and then served their Summons and supporting material, it was not until January 2011 that the plaintiff issued a Summons to amend its name; • Fourthly, the plaintiff had failed properly to particularise its claim, including identifying the documents and electronic data in which confidential information was contained, identifying when and what confidential information was obtained and used or copied or removed by the defendants. They had also failed to particularise damages. 108 The plaintiff could have acted far more promptly, particularly to resolve issues concerning the adequacy of the defendants’ discovery. The plaintiff complained about inadequate discovery by the defendants by a letter dated 4 July 2005, when the proceedings had already been on foot for two and three- quarter years. Nothing much happened until June 2006 when the proceeding was fixed for hearing for a fourth time. Further correspondence about discovery occurred in February 2007. The plaintiff issued a Summons regarding the defendants’ discovery on 1 March 2007, but did not seek any self-executing orders.
109 The plaintiff still regards the defendants’ discovery as inadequate. The defendants have filed three affidavits of documents: on 20 May 2003; on 8 June 2005 and on 4 June 2008. Mr De La Rue, in his affidavit of 3 February 2011, stated that the plaintiff’s claim is substantial, but that the further particularising of it had been hampered by the failure of the defendants to provide discovery and by the destruction by Ms Morris of her 2001 diary after the commencement of the proceeding.
110 In May 2008, the Court ordered the plaintiff to make further discovery by 4 June 2008, in default of which the proceedings would be stayed. It was stayed.
111 The defendants have been prejudiced in their conduct of a trial because of delay. First is the general prejudice suffered as a result of lengthy delay. In Brisbane South Regional Health Authority v Taylor,[16] McHugh J stated:
“The longer the delay in commencing proceedings, the more likely it is that the case will be decided on less evidence than was available to the parties at the time that the cause of action arose.”[17]
[16] (1996) 186 CLR 541
[17] (supra) at 551
112 This observation was equally applicable to the conduct of proceedings as to the commencement of proceedings.[18]
[18] Imaging Applications Pty Ltd v Vero Insurance Ltd [2008] VSC 178 at [31]
113 Secondly, the defendants were prejudiced by the unavailability of two witnesses, one of whom, Ms L Smith, died in or about 2005 and the other, Ms S Hill, who lives overseas.
114 Ms Morris states that she worked with Ms Smith at a company, John Brown Services, involved in tennis promotions, prior to commencing her work for Corporate Sports and Entertainment Group. Ms Smith had been its operations manager. When Ms Morris left John Brown Services, Ms Smith gave her a copy of the contact list they had developed for the business and gave her permission to use it. Ms Morris brought the list to, and used it at, Corporate Sports and Entertainment Group. No affidavit or proof of evidence was taken from Ms Smith.
115 It is unclear whether the plaintiff’s case includes allegations based on contact with any of the clients contained on the list that Ms Smith gave Ms Morris. Counsel for the defendants submitted that these witnesses would have given evidence related to the existence of the alleged confidential information upon which the plaintiff’s claim depends, although it was yet to be particularised. These witnesses’ evidence, it is said, would have established that through their work, they and the first defendant generated knowledge about various clients or customers and their interests and catered to their needs. When the first defendant joined the plaintiff, she took this information with her as the plaintiff knew. It could not have been confidential information.
116 Ms Morris worked with Ms S Hill at the firm Condor Recruitment during 2001. The terms on which Ms Morris worked for Corporate Sports and Entertainment Group permitted her to also work for Condor Recruitment Agency.[19] According to Ms Morris, Condor Recruitment and Corporate Sports and Entertainment Group shared and merged contact lists. I take this to mean that they permitted each other to contact the other’s clients. Ms Hill is no longer living or working in Australia and Ms Morris states that it may be difficult to arrange for her to give evidence in the proceeding. However, there is no evidence of where Ms Hill resides, of how frequently Ms Morris is in contact with her, or of her availability to give evidence by video link.
[19] See the affidavit of Cyril David Ger of 3 February 2011 paragraphs 3-6
117 Ms Morris also refers to other potential witnesses she may wish to call, who were not named, with whom she dealt as customers while working for Corporate Sports and Entertainment Group, some eight and a half years ago. She states that those persons no longer work for the customers, would be difficult to locate, contact and arrange to give evidence about the matters alleged in the plaintiff’s claim. She expresses concern about whether those individuals will now be able to recollect what occurred, having regard to the effluxion of time.
118 The defendants’ solicitors swear that once the particulars are provided, further witnesses may need to be located and called to give evidence which may be extremely difficult considering the effluxion of time since the commencement of the proceeding.
119 Finally, the defendants submit that as the plaintiff’s case alleges personal misconduct of the first defendant in abusing her position, breaching her fiduciary duties and acting improperly, her professional reputation is impugned and this matter should not be left hanging over their heads for ten years.
The Plaintiff’s Submissions
120 Counsel for the plaintiff submitted that the defendants bore the onus of establishing that there had been inordinate delay in progressing the proceeding and that as a consequence there was a real likelihood that a fair trial could not be obtained.
121 Delay has been caused by the actions of both parties. The plaintiff should not be penalised for having adopted a conciliatory approach to the litigation and not seeking the intervention of the Court every time it had a complaint about the defendants’ conduct of the interlocutory steps. Five trial dates had been adjourned by consent. Three affidavits of documents had been filed by the defendants indicating initial unsatisfactory or incomplete discovery. In 2005 and 2010, mediations were conducted. The plaintiff’s solicitors had written to the defendants’ solicitors on 6 October 2006 that the proceeding would be listed as a cause on 27 March 2007 if the trial fee was paid by 6 November 2006, and stating:
“In relation to the primary proceeding, we confirm the Plaintiff is proceeding with the action and we will address the outstanding directions shortly. In this regard, we note that we had previously written to you in relation to the Defendant’s inadequate discovery and are yet to receive a response. The lack of proper discovery is affecting the Plaintiff’s ability to provide Further and Better Particulars.”
122 The defendants did not respond. Further requests about discovery and inspection were sent in February and March 2007. The plaintiff had provided an expert’s witness statement on damages in March 2007, but none had been received from the defendants.
123 In an affidavit of 15 December 2010, the plaintiff’s solicitors stated that the requested copy discovered documentation had not been supplied by the defendants’ solicitors, nor have the plaintiff’s solicitors been able to arrange for an inspection of documents listed in the defendants’ supplementary affidavit of documents.
124 The chronology set out above lists the occasions when the plaintiff’s solicitors raised the issue of the adequacy of the defendants’ discovery, e.g. on 24 April 2007 and 31 May 2007.
125 The plaintiff, in the first half of 2009, had requested the defendants to hold discussions about the case, including through a case conference. Then, on 12 June 2009, the plaintiff had requested the re-listing of the proceeding.
126 A period of at least nine months from July 2009 to April 2010 had been caused by the solicitor for the defendants ceasing to act. Whilst a less conciliatory solicitor might have pursued the proceedings against the defendants whilst they were unrepresented, the plaintiff should not be criticised for not having done so. A number of delays since July 2010 were due to the unavailability of the plaintiff’s counsel.
127 The defendants had not established that they would suffer prejudice because of delay by the plaintiff in the proceeding due to an inability to call particular witnesses. In the case of Ms L Smith, the contact list that she was said to have provided to Ms Morris had not been discovered, nor had it been established that there was no other witness to give evidence about it.
128 I do not consider that I can act on the basis that the contact list was not discovered because the point was contested by counsel for the defendants There is a category of documents in the defendants’ first affidavit of documents that may include it.
129 It was also submitted that it was not clear whether this proceeding would have been ready for trial before Ms Smith’s death in or about 2005.
130 The evidence about the witness Ms Hills being overseas lacked detail and did not explain why she would not be able to give evidence.
131 The other category of evidence relating to witnesses, whose memories may have become faulty, was vague and speculative with no identification of the particular witnesses and no suggestion that any attempt had been made to obtain a proof of their evidence.
Conclusion about the Dismissal for Want of Prosecution Application
The Delay
132 The chronology of this proceeding reveals three phases.
133 The first is the period between the commencement of the proceeding in 2002 and the end of 2005. If the parties had been ready, a trial could have occurred in February 2004. It was vacated by consent. As often occurs, the pleadings required amendment and further interlocutory steps, including the delivery of experts reports had not been completed. That requirement, plus the consequence of the striking out of the proceeding because neither party attended a directions hearing in April 2004, and the making of directions in September 2004, occupied most of that year.
134 The trial was not ready to proceed in April 2005, further amended pleadings were required and the defendants were ordered to provide further discovery. A further trial date was lost in October 2005 and instead a mediation, was held but apparently not completed. The defendants served a Request for Particulars in November 2005 and the plaintiffs took the position that they could not provide them until they received discovery.
135 I would not attribute the delay in the proceeding occurring till the end of 2005 to the conduct of the plaintiff, because delay resulted from both parties’ need to complete interlocutory steps.
136 The second phase in the proceeding commenced in 2006. At that point it was for the plaintiff to press firmly for the resolution of any outstanding issues about discovery and provide any outstanding particulars, in order that the trial might occur. It did not do that.
137 Issues about discovery as an aid in the proof of a plaintiff’s case in litigation involving claims of misuse of confidential claim are common place. Anton Pillar orders, now described as “Search Orders” can be sought.[20] It is for the plaintiff to pursue further orders for discovery, if it considers that the defendants have not complied with their obligations. It is no answer to say to this obligation that at some time later, in this case May 2008, that the defendants provided a third affidavit of documents.
[20] See Rule 37B of the County Court Civil Procedure Rules 2008
138 The plaintiff did not issue a Summons seeking further discovery until March 2007 – fourteen months after it had raised the issue. This Summons was ultimately not pressed and was replaced by a Summons issued on 2 March 2011, a fortnight before this hearing and six years after the plaintiff first raised issues about the defendants’ discovery. If the plaintiff had pressed any outstanding issue about discovery, including the provision of copies of documents it sought, in all likelihood the case could have gone to trial in the second half of 2007.
139 The defendants requested further and better particulars on 7 November 2005. On 6 June 2006, the Court ordered that the plaintiff provide particulars of damages together with supporting documentation and discovery. Further orders for the plaintiff to provide particulars were made in May 2008. The plaintiff contended that the defendants’ lack of discovery affected its ability to provide particulars. The plaintiff should have pressed its discovery application in 2007. If it had and, regardless of the outcome of such an application, in all probability, the proceeding would have been heard and determined some years ago.
140 A year passed between October 2005 and October 2006 with little being done by the plaintiff to press the case to trial.
141 The plaintiff, although it provided an expert’s statement in March 2007, failed to comply with other parts of the order of 6 March 2007 and the proceeding was stayed.
142 On 18 June 2007, the defendants filed a Summons seeking discovery and particulars and in default, the striking out of the proceeding.
143 The orders of 21 June 2007 were made because it was thought that the plaintiff had been deregistered. In fact Corporate Sports & Entertainment Pty Ltd had been deregistered. The confusion about this issue, which I have referred to above, led to the loss of a further trial date in July 2007. Not only had the wrong company been named as plaintiff, but the plaintiff’s representatives apparently were unaware that the company that they should have named as plaintiff had been deregistered almost eighteen months previously.
144 Eleven months passed, all of which must be attributed to the plaintiff until the stay was lifted on 21 May 2008. Further interlocutory orders were made against the plaintiff. It is true that the defendants provided a third affidavit of documents on 4 June 2008.
145 But between June 2008 and June 2009, nothing of substance occurred. The plaintiff’s solicitors wrote a few letters to the defendants’ solicitors in the first half of 2009 suggesting a case conference and then a meeting to discuss issues, but they were not accepted.
146 On 12 June 2009, the third phase of the litigation commenced. The plaintiff applied to have the proceeding relisted. Soon thereafter, the defendants’ solicitors withdrew and nine months passed until their current solicitors went on record. Although the plaintiff could have done much to force the proceeding on during that period, on balance, I am prepared to accept the submission that the plaintiff should not be penalised for its delay during that time. The defendants did take about nine months to arrange the further representation that had been foreshadowed. Accordingly, I disregard that nine months in determining the net delay for which the plaintiff is responsible.
147 Since late April 2010, the defendants’ new solicitors have been on the record, and in July 2010, issued the present Summons. The delay in their hearing has been caused, in part, by the unavailability of the plaintiff’s counsel.
148 The parties agreed to adjourn the Summons so that a mediation could be held. It occurred on 21 October 2010, but it did not resolve the proceeding. On 2 December 2010, the Court made a self executing order requiring the plaintiff to file any affidavit material by 16 December 2010. On 20 January 2011, almost six months after the issue of the defendants’ Summons, the plaintiff filed its Summons seeking to amend the name of the plaintiff, and on 2 March 2011, issued a Summons seeking further discovery.
149 The result of that analysis of the chronology is that, if the plaintiff had acted with reasonable dispatch, in all probability the proceeding could have been heard by the end of 2007. This was before the merger of legal firms requiring the defendants’ solicitors to withdraw.
150 The proceeding is now unlikely to be heard for at least a further six months, and probably not until early 2012, as there are still interlocutory disputes about discovery and particulars. The net delay in the hearing of the proceeding attributable to the plaintiff is likely to prove to be at least three and a half years. That conclusion is reached by taking the four years and three months between the end of 2007 and March 2011 and excluding the nine months while the defendants were unrepresented.
151 There has been a failure by the plaintiff to prosecute the proceeding in a way which would allow the interlocutory steps to be concluded within a reasonable time.[21]
[21] Bishopsgate Insurance Australia Ltd (in liq) v Deloitte Haskins & Sells (supra) at 876
152 The parties took opposing positions about the obligation of the defendants to spur the litigation on or whether their failure to do so could be taken into account. The plaintiff referred to the Court of Appeal decision in Shellard v Orlanski (t/as Gordon & Orlanski)[22] where the delays of the defendant were taken into account. The defendants referred to the earlier Court of Appeal judgment of Reid v Australian Guarantee Corporation Ltd[23] in which Winneke P stated that such a consideration was not relevant:
“There is no obligation, in my view, on the part of the defendant in general to take steps to protect his interests. The courts have often said that the obligation is on the plaintiff to prosecute his action with diligence, under pain of suffering the consequences of losing his right to pursue his action if he does not. There is no obligation to ‘stir the plaintiff out of his lethargy’ so as to ensure that prejudice does not occur to him as a consequence of the plaintiff’s delay.”[24]
[22] [2001] VSCA 147
[23] [1996] VSC 18
[24] (supra) at [22] - Hayne JA and Charles JA agreed
153 I do not consider that generally a defendant is required to press to bring a proceeding to trial. However, where the defendant is required to take interlocutory steps, its failure to complete them in a reasonable time may well be a relevant matter. Here, the balance of the delay since the end of 2005 is the responsibility of the plaintiff.
154 The plaintiff’s delay in bringing the proceeding on for hearing is inordinate. To take more than four years to pursue, but not to finalise, an interlocutory dispute about discovery, is not adequately explained. It is no answer to rely on lack of co-operative response by the defendants.
155 The defendants provided a third affidavit of documents on 4 June 2008. If the plaintiff wished to pursue the discovery or inspection of further documents it should have done so at the very latest promptly after the receipt of that third affidavit. In fact the plaintiff had ample opportunity months before June 2008 to press an application for further discovery and for subsequent inspection. As indicated above, any application should have been competed so as to permit a trial to be conducted before the end of 2007. But it did not do so. While the case was not subject to the case management procedures now applied to commercial litigation in this Court,[25] the delay that has occurred can only be regarded as inordinate.
[25] See Practice Note 6 – 2010 Operation and Management of the Commercial List
No Adequate Explanation for Delay
156 For the reasons I have given above, I consider that the plaintiff has provided no adequate explanation for the failure to bring the proceeding to trial by the end of 2007.
Existence of Prejudice to the Defendants
157 The conclusion that the plaintiff has inordinately delayed in prosecuting the proceeding without adequate explanation leads to the question whether, as a result of that delay, there is a substantial risk that the defendants will not be able to have a fair trial of the proceeding. The observations of McHugh J in Brisbane South Regional Health Authority v Taylor[26] as to the effect of delay on the availability of evidence have to be kept in mind. A passage in the judgment of McLelland CJ in Eq in Watson v Foxman,[27] although made in a longer passage dealing with proof of misleading or deceptive conduct, is relevant at least to the evidence of the directors of the parties:
“… Furthermore, human memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the process of memory are overlaid, often subconsciously, by perceptions of self-interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed. All this is a matter of ordinary human experience.”
[26] supra
[27] (2000) 49 NSWLR 315 at 318-319
158 Prejudice can be inferred. In Bishopsgate Insurance v Deloitte Haskins,[28] Tadgell and Ormiston JJ stated:
“Although there are many cases in which the necessity to establish prejudice has been stated as a condition precedent to the exercise of the power to dismiss for want of prosecution on the basis of delay, it is not correct, in our opinion, to say that the defendant is obliged to allege that prejudice upon affidavit as opposed to asking the court to infer from all the circumstances of the case that prejudice has been or is likely to be suffered. This is not to deny that prejudice, actual and potential must be established; it is merely a reminder that proof of any issue can be established by circumstantial evidence and of the necessary process of inference from such evidence. Nor are we suggesting, for it would be contrary to authority, that it is for the plaintiff to disprove prejudice; but the defendant is entitled to point to undisputed facts and ask the to draw necessary logical inferences from them for this purpose.”[29]
[28] supra
[29] [1999] 3 VR 863 at 875 see also at 879
159 The death of witnesses, whose evidence may have assisted a party, is an important consideration.
160 However, I am not persuaded that the unavailability of Ms Smith as a defendants’ witness, to give evidence about the contact list, is caused by the plaintiff’s delay. I have concluded that I would not attribute to the plaintiff inordinate delay up to the end of 2005, the year in which apparently Ms Smith died. Therefore that particular prejudice “is not causally related to the delay”.[30]
[30] Hughes v Gales (1995) 14 WAR 434 at 445 per Malcolm CJ
161 In any event, it is difficult to assess at this point how important Ms Smith’s evidence would have been. The defendants have not shown that there is no other witness whose evidence might prove the contact list.
162 I do not consider that the material discloses relevant prejudice through the presence of Ms Hill overseas. The defendants have not proved that Ms Hill is unable to return to Australia, or give evidence by video link. However, the defendants may still be prejudiced in presenting Ms Hill’s evidence for the reason I next discuss.
163 However, I do consider that the defendants have established, at the very least by inference, a more general prejudice in respect of their conduct of the defence of this proceeding. That prejudice is in their ability to respond to allegations of soliciting business from persons who were clients of Corporate Sports & Entertainment Pty Ltd prior to November 2001.
164 The defendants on three occasions requested particulars. The plaintiff gave particulars, including the names of twenty four clients in June 2003, but no details of the alleged improper contact with those clients. While it is true that the defendants knew that the plaintiff’s case related in some way to those persons, no other details of conduct in respect of them were provided.
165 In the plaintiff’s particulars of its Further Amended Statement of Claim given on 24 November 2004, the plaintiff alleged that Ms Morris, as part of her preparation to set up a business in competition with the plaintiff, communicated with three named businesses and advised them of her proposed business in competition with the plaintiff whilst still employed by it.
166 The plaintiff claims that it cannot give more particulars until it receives further discovery.
167 As a matter of common sense, there is a substantial risk that the memories of clients of how they came to organise hospitality through the defendants at sporting events in 2001 and 2002 will have deteriorated. There is a significant risk that the means of arranging of corporate hospitality at sporting events may well leave little residual memory after ten years.
168 Common experience of witness actions is that truthful witnesses often have difficulty remembering the details of events even a year or two ago, let alone ten years. This is particularly the case where the witness has had no reason to seek to remember the events. The position may be different where the event in question is a dramatic, singular event such as an accident or a crime. The organisation of corporate hospitality a decade ago is likely to be less remembered than such events.
169 A witness such as Ms Hill is likely to have difficulty in recalling with any precision her dealings with Ms Morris a decade ago.
170 The second important consideration is that the plaintiff is still not ready to go to trial. The plaintiff’s case was not that it would like further discovery, but if that were not ordered it would be prepared to have its case tried in its present form. Rather, nine years after Ms Morris left the plaintiff’s business, the plaintiff wishes to expand, or indeed establish its case, by obtaining further discovery.
171 If an order were made for further discovery and further documents produced, further particulars would be delivered and expert evidence as to quantum required.
172 There is, of course, no certainty that either further discovery will be permitted or that the case will be expanded. But as I have stated, the plaintiff does not seek to have the case, as presently particularised, set down for hearing for a sixth time.
173 On the other hand, the defendants seek further particulars which the plaintiff at present is unable to give.
174 If the plaintiff obtained an order for discovery and broadened it case, then the defendants would be required to investigate the further details of the case in respect of events occurring ten years ago. Whist Ms Morris may turn out to be the primary witness for the defendants and may have a clear recollection of events, other witnesses, including clients and Ms Hill, may be required.
175 The plaintiff’s case may well consist in part on documentary evidence and letters sent by the defendants to particular businesses and the like – but witnesses will still be required to identify those documents and to give them context.
176 The conclusion I reach, based on the two factors discussed, is that there is a substantial risk that the delay has caused serious prejudice to the defendants between themselves and the plaintiff.
177 I understand that it is a significant step to dismiss a proceeding, even one that has been on foot for eight and a half years. The plaintiff thereby loses its right to have its case heard and determined.
178 However, the key question in the end, is whether the balance of justice requires that the action be dismissed.[31] In my opinion, because of the delay, the lack of an adequate explanation for it, the resultant substantial risk of serious prejudice to the defendants and because the case is still not ready to go to trial, justice requires that the proceeding be dismissed.
[31] See Reid v Australian Guarantee Corporation Ltd (supra) at [22] per Winneke P
179 I have taken into account that many of the early delays were in a sense sanctioned by the consent being given by the defendants and that the Court did make five orders adjourning the trial. But the plaintiff received warnings of the risks it was taking, on one occasion the proceeding was stayed, on another occasion the defendants applied to strike it out and last December a self executing order was made.
180 For the sake of completeness, I will mention two other matters.
181 First, I note that the parties were able to hold a mediation late last year, but that is a long way from being able to defend a claim without suffering significant prejudice.
182 Secondly, the evidence does not establish particular damage to the reputation of either defendant but the existence of the case must have added to stress that the parties have experienced.
183 The remaining issues in the Summons concerning the defendants’ application for security for costs and the plaintiff’s application for further discovery were not argued before me and obviously do not arise in view of the conclusion that I have reached.
Conclusion
184 I will make the following orders:
(a) The name of the plaintiff be amended to Corporate Sports & Entertainment Pty Ltd and the title of the proceeding be amended accordingly; (b) The proceeding be dismissed; (c) The plaintiff’s Summons dated 20 January 2011 and 2 March 2011 and the defendants’ Summons dated 27 July 2010 are otherwise dismissed. 185 I will hear the parties on costs.
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