D'Anglers Paradise Pty Ltd v MMI General Insurance Ltd

[2000] FCA 417

FEDERAL COURT OF AUSTRALIA

D’Anglers Paradise Pty Ltd v MMI General Insurance Ltd [2000] FCA 417

D’ANGLERS PARADISE PTY LTD v MMI GENERAL INSURANCE LIMITED
NG 302 OF 1997

DOWSETT J
3 APRIL 2000
BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	NG 302 OF 1997

BETWEEN:	D’ANGLERS PARADISE PTY LTD APPLICANT
AND:	MMI GENERAL INSURANCE LIMITED RESPONDENT
JUDGE:	DOWSETT J
DATE OF ORDER:	3 APRIL 2000
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.        The action be adjourned until 10.15 am 4 April 2000. 

2.        The applicant pay the respondent’s costs thrown away by the adjournment.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	NG 302 OF 1997

BETWEEN:	D’ANGLERS PARADISE PTY LTD APPLICANT
AND:	MMI GENERAL INSURANCE LIMITED RESPONDENT

JUDGE:	DOWSETT J
DATE:	3 APRIL 2000
PLACE:	BRISBANE

REASONS FOR JUDGMENT

1. Some months ago, this action was set down for trial over the next eight days.  In the last week or so, however, there have been indications that perhaps the applicant might seek an adjournment.  When the matter was called on today, counsel for the applicant indicated that he was in possession of instructions only to seek an adjournment of the trial and not to take any further part in it.  He indicated, however, that he and his instructing solicitors were concerned with the capacity of Mr Loiero, a director of the applicant, to give such instructions.  It was suggested that he, in conversations with his solicitor, behaved in a way which brought into doubt his mental capacity.  The position was further aggravated, it was said, by the fact that although searches in the office of the Securities and Investment Commission indicated that there was another director, Mrs Loiero, there is some reason to believe that she may have resigned from that position in June of last year.  The evidence does not presently establish that assertion.  It seems that in her statement of evidence for the purposes of this action, she claimed to be a director.  That document was executed in February of this year. 

2. Mr Loiero swore an affidavit on 2 April to which he exhibited certain medical reports, suggesting that he may be suffering from cognitive disability with brain fog and poor memory and concentration, attributable to certain medication.  However, upon the respondent indicating that it wished to cross-examine the medical practitioner, it was indicated that he was not available.  Counsel for the applicant has made it clear that he does not now seek to rely upon the medical evidence annexed to Mr Loiero's affidavit.  It has been arranged for Mr Loiero to see a psychiatrist tomorrow morning, with a view to clarifying the question of his psychiatric condition.  In those circumstances, and apparently without any specific instructions, I am asked to adjourn the matter until tomorrow to enable that course to be followed.  I should say that when this matter was first raised this morning, it was expected that the psychiatric examination would take place this morning, but that has not eventuated.  I accept that it would have been difficult to organise it at any earlier time than tomorrow morning.  The difficulty, then, with which I am faced is whether or not to allow an adjournment until tomorrow morning to enable the psychiatric examination to take place, notwithstanding the fact that I have no evidence supporting the assertion that a psychiatric examination of Mr Loiero is necessary, nor evidence that he is the only director.

3. Mr Hocking, the instructing solicitor, gave evidence, indicating that Mr Loiero appeared to have taken a fairly irrational approach in the course of conversations with him on Thursday and Friday of last week and over the week-end.  However the evidence does not suggest that the conduct was beyond that experienced from time to time in litigants who believe that they are not likely to get their own way in the litigation or that their solicitor is not conducting the case in a way which they consider to be appropriate.  It seems, however, that Mr Hocking formed the view that there was some reason to doubt Mr Loiero's capacity to give instructions, and I consider that where a legal practitioner has formed that view, it is generally undesirable for the Court simply to ignore it.  Practitioners must, not infrequently, assess the capacity of a client to give appropriate instructions.  I would not like to be thought to be encouraging practitioners to shirk that duty.

4. In the circumstances, and although I have very grave reservations about the whole matter, I am inclined to adjourn the matter until tomorrow to enable the applicant to obtain appropriate evidence, both as to the state of the directorate and as to the medical condition of Mr Loiero.  This is upon the basis that the latter will be available early in the morning.  It does seem to me, however, that such a course should only be taken if the respondent is protected as to costs.  I am at something of a loss to know how I can achieve that, given that, as I am told, counsel for the applicant does not have express instructions to seek an adjournment until tomorrow.  If I make an order against the applicant for the costs of today as a condition of allowing its application for an adjournment until tomorrow, the applicant may assert that the adjournment was sought without instructions, it having instructed its legal advisers to seek a longer adjournment.  Those legal advisers might be liable for the costs as damages for breach of warranty of authority, but more likely, the respondent will be unable to recover them in that way simply because there has been no such warranty.  The applicant's counsel has made it clear that he has no specific authority to ask for an adjournment until tomorrow, but arguably that lesser position may be included in the broader instructions to seek a longer adjournment.  Given the lateness of the hour, little purpose will be served by reflecting further on this problem.  I adjourn the action until 10.15 tomorrow.  I order the applicant to pay the respondent’s costs thrown away by the adjournment. 

I certify that the preceding four (4) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.

Associate:

Dated:             6 April 2000

Counsel for the Applicant:	Mr R Cameron
Solicitor for the Applicant:	Dennis & Company
Counsel for the Respondent:	Mr G A Thompson SC Mr D G Clothier
Solicitor for the Respondent:	Dunhill Madden Butler
Date of Hearing:	3 April 2000
Date of Judgment:	3 April 2000