Dimarti v AB Law Group Pty Ltd (No 2)

[2024] NSWSC 654

Supreme Court

New South Wales

Medium Neutral Citation:

Dimarti v AB Law Group Pty Ltd (No 2) [2024] NSWSC 654

Hearing dates:

29 May 2024

Date of orders:

29 May 2024

Decision date:

29 May 2024

Jurisdiction:

Common Law

Before:

Elkaim AJ

Decision:

1. Leave to amend the amended summons filed on 29 February 2024 is refused.

2. The application for an extension of time to file the amended summons, whether for the purpose of an appeal or a judicial review, is refused.

3. The amended summons filed on 29 February 2024 is dismissed.

4. The plaintiffs are to pay the defendant’s costs of the proceedings.

5. I will hear the parties if any alternative costs order is sought.

Catchwords:

CIVIL PROCEDURE – exercise of discretion whether to allow amendment of amended summons and extension of time – where court in previous notice of motion gave directions not complied with as to time and content – failure to comply with Uniform Civil Procedure Rules 2005 (NSW) – no reasonable excuse for the delay – no prospect of success in substantive case – leave refused to amend the amended summons and for an extension of time

Legislation Cited:

Legal Profession Uniform Law Application Act 2014 (NSW), s 91

Uniform Civil Procedure Rules 2005 (NSW), rr 50.2, 50.3, 59.10

Category:

Principal judgment

Parties:

Margherita Dimarti (First Plaintiff)
Rocco Dimarti (Second Plaintiff)
Natalie Dimarti (Third Plaintiff)
AB Pty Ltd (Defendant)

Representation:

Counsel:
Mr J Pope (Plaintiff’s Solicitor)
Ms XY (Defendant) (Self Represented)

Solicitors:
Pope & Spinks Solicitors (Plaintiffs)
AB Law Group (Defendant)

File Number(s):

2023/293321

Publication restriction:

Yes

JUDGMENT

1. The summons before the court was filed on 14 September 2023. It seeks an order that a certificate of determination of legal costs be set aside. It also requests an order that the defendant pay the plaintiff’s $106,000.

2. On 15 December 2023 I heard a notice of motion, filed on 19 October 2023, in which the defendant sought an order that the summons be dismissed (Dimarti v AB Law Group Pty Ltd [2023] NSWSC 1595). I refused the application but was critical of the summons. I said the following at [37]-[38]:

“I am not prepared to go so far as to say that there is no real question to be tried.  I think the issue of fraud is a real question and does need to be litigated.  However, there needs to be substantial amendments made to the summons.  The plaintiffs have suggested the possibility of the proceedings continuing by way of a statement of claim.  While there is some attraction in that suggestion, the court rules contemplate an appeal proceeding by way of a summons.

I intend therefore to give the plaintiffs leave to file an amended summons in which it is to be clearly stated that the proceedings involve an appeal from the decision of the cost panel and also include an application for leave to appeal out of time.”

3. I then made orders giving the plaintiffs leave to file an amended summons by 25 January 2024. An amended summons was filed but not until 29 February 2024. One of the orders I made was that the amended summons include an application for an extension of time for an appeal from the decision of a costs panel. This is an explicit requirement of the Uniform Civil Procedure Rules 2005 (NSW) (the UCPR). Rule 50.3 states:

“An application for an extension of time under subrule (1)(c) must be included in the summons commencing the appeal.”

4. The amended summons does not include the application for an extension of time. On the one hand this might be seen as a fairly minor omission capable of correction by either the filing of a fresh summons or the waiver of the rule. On the other hand, the plaintiffs were specifically told, as a condition of leave being granted to file an amended summons, that the application for an extension of time needed to be included in the amended summons. Order (3) of the orders I made on 15 December 2023 was:

“3. The amended summons is to include an application for an extension of time for the appeal.”

5. I also made an order that the amended summons should “explicitly state that the relief sought is by way of an appeal from the decision of the cost panel.” Again, the amended summons does not comply.

6. Another matter I pointed out was that “s 91 of the LPULA requires that notice must be given of any appeal to the Manager, Costs Assessment.” The LPULA refers to the Legal Profession Uniform Law Application Act 2014 (NSW). There is still no evidence that this has occurred.

7. I pointed out these deficiencies in the amended summons to Mr Pope, who appeared for, and is, the plaintiff’s solicitor and he immediately conceded the omissions and sought leave to further amend the amended summons. The leave was opposed.

8. Another matter which became evident was that the plaintiffs did not actually wish to appeal from the decision of the cost panel, but rather sought a judicial review of the panel’s decision.

9. If the matter had been put as an appeal the summons should have been filed within 28 days (UCPR rr 50.2 and 50.3). If the suit was for judicial review, then the application should have been filed within three months of the decision (UCPR r 59.10). Accordingly, whether an appeal or an application for judicial review, the original summons was respectively out of time by almost eight months or almost six months.

10. The result of the above was that leave was required to amend the amended summons, and secondly, time needed to be extended for either the appeal or the judicial review.

11. Normally I would be very reluctant to refuse leave to make an amendment to a summons where the amendments were in effect technical and required in order to fit within particular rules of court. It could also not be said that the defendant would have been taken by surprise, or prejudiced, by the amendment.

12. However, in this case, where I explicitly brought the deficiencies to the attention of the plaintiffs and gave them leave to continue their proceedings on the basis of the conditions of the leave, I think the position is different. The rules of Court, and orders made by a Court, have a purpose. There are times when the rules can be waived in order to achieve a just result, but that assumes that there has not been a reminder of the need to comply with the rules followed by an ignoring of that reminder.

13. In relation to the extension of time, the reason given by Mr Pope for the delay was that his clients were awaiting the conclusion of a criminal investigation they had initiated, a complaint to the Law Society that they had made about Ms XY and also the result of a criminal prosecution that had been undertaken against Ms XY.

14. According to a letter from the Law Society (attached to an affidavit of Mr Pope dated 28 May 2024) the complaints were made to the Law Society in 2021 and 2022. They were referred to the Office of Legal Services Commissioner but “remain under consideration.” It would be perfectly reasonable for the plaintiffs to wish to know the results of the complaints. However, that is no explanation for the continuing delay, over some months, before the summons was filed.

15. In relation to the criminal proceedings still awaiting decision, it was conceded that they were not in any way connected to the dispute between the plaintiffs and the defendant.

16. There is another important element to my decision not to extend time. It is an important consideration in an application for an extension that the case to be pursued has some merit. I recognised this in my earlier decision because of the serious allegation of fraud, in particular forgery of signatures and the withdrawal of a large sum of money without authority, that had been made by the plaintiffs.

17. Drawing on the plaintiffs’ written submissions and on the frank statements made by Mr Pope in court today, the following emerged:

1. the allegation concerning the unauthorised withdrawal of $106,000 was not being pressed because there was simply no evidence of the fact;

2. there was no independent evidence, such as a handwriting expert, as to the forgery of the signatures; and

3. quoting from the written submissions: “It is not disputed that legal work was performed by AB Law Group and that work was largely performed by Ms XY (who then held a practising certificate).” I note here that the cost panel had assessed the legal work done by the defendant on a quantum merit basis.

18. I asked Mr Pope if he could describe the contentions that the plaintiffs wished to make in the substantive proceedings. He said that the plaintiffs wanted to assert that not all the work said to have been done by the defendant had actually been done and that there was a “generalised” feeling of deceit on the part of Ms XY.

19. Mr Pope conceded that there had been no particulars given of any fraud allegation although he said there were “whispers” of fraud. The only whisper Mr Pope could identify was that Ms XY continued to assert that the defendant was a law firm when in fact the Law Society had suspended Ms XY’s practising certificate. Mr Pope however appropriately conceded that at the time of the relevant events, that is when the plaintiffs were clients of the defendant, Ms XY did have a practising certificate and the defendant was properly described as a law firm.

20. Specifically, Mr Pope accepted the following proposition: that apart from a generalised feeling of deceit held by the plaintiffs, there was no evidence of deceit before the court.

21. Therefore, against a background of directions not being complied with (regarding the late filing and the missing contents of the amended summons), no reasonable excuse for the delay, and a seemingly hopeless case (should leave be granted), I have come to the decision that the two preliminary matters I have outlined above should be found against the plaintiffs.

22. The result of these conclusions is that the amended summons must be dismissed with costs.

23. I make the following orders:

1. Leave to amend the amended summons filed on 29 February 2024 is refused.

2. The application for an extension of time to file the amended summons, whether for the purpose of an appeal or a judicial review, is refused.

3. The amended summons filed on 29 February 2024 is dismissed.

4. The plaintiffs are to pay the defendant’s costs of the proceedings.

5. I will hear the parties if any alternative costs order is sought.

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Decision last updated: 29 May 2024