Gippsreal Ltd v Kenny
[2016] VSCA 65
•8 April 2016
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2016 0023
| GIPPSREAL LTD | Applicant |
| v | |
| CAROLINE MAJELLA KENNY and IAN SYMONDS & ASSOCIATES | Respondents |
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| JUDGES: | KYROU JA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | No oral hearing requested |
| DATE OF JUDGMENT: | 8 April 2016 |
| MEDIUM NEUTRAL CITATION: | [2016] VSCA 65 |
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DETERMINED ON THE PAPERS
PRACTICE AND PROCEDURE – Application for leave to appeal filed 29 days out of time – Delay in authentication of order – Mistaken view by applicant’s lawyers that authenticated order required before leave to appeal could be sought – Delay not inordinate and not the fault of applicant – Application granted.
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| APPEARANCES: | Counsel | Solicitors |
| No appearances. |
KYROU JA:
Introduction and summary
By an application filed on 1 March 2016, the applicant seeks an extension of time within which to file an application for leave to appeal against two paragraphs of an order made by Vickery J. As discussed at [18] below, it is unclear whether both paragraphs of that order were made by the judge on 18 December 2015, thus requiring an extension of time for both, or whether one of the paragraphs was made on 11 February 2016, thus obviating the need for an extension of time in respect of that paragraph.
For reasons that follow, on the assumption that an extension of time is required in respect of both paragraphs of Vickery J’s order, I am satisfied that an extension should be granted.
Facts and procedural history
The circumstances giving rise to the present application are complex. What follows is a brief and selective summary of those circumstances.
The applicant was a party to two separate proceedings against Action Cycles Pty Ltd and others (‘AC parties’). I will adopt Vickery J’s description of those proceedings as the ‘2011 Proceeding’ and the ‘2012 Proceeding’. On 1 March 2012, the applicant and the AC parties executed a deed of settlement. Subsequently, the AC parties alleged that the deed of settlement was unenforceable and should be set aside. Ian Symonds & Associates (‘Firm’) and Caroline Kenny (‘Barrister’) acted for the AC parties in both proceedings when this allegation was made.
On 30 April 2012, the applicant’s solicitor wrote to the Firm and to the Barrister putting them on notice that, if it was determined that the AC parties had no basis to oppose judgment in favour of the applicant, the applicant would seek an order for indemnity costs against the Firm and the Barrister personally.
On 7 August 2012, after the Firm and the Barrister had ceased to act for the AC parties, the applicant obtained judgment by consent against the AC parties in the 2011 Proceeding and the 2012 Proceeding. The relief included a declaration that the deed of settlement was valid and binding.
On 22 December 2014, the applicant applied by summonses for orders that the Firm and the Barrister personally pay some of the costs of the 2011 Proceeding and the 2012 Proceeding. The applicant relied on two grounds, namely s 29 of the Civil Procedure Act 2010 (‘CP Act’) and r 63.23 of the Supreme Court (General Civil Procedure) Rules 2005 (‘2005 Rules’).
On 3 February 2015, the applicant filed subpoenas addressed to the Firm and the Barrister.
On 2 April 2015, the Firm and the Barrister applied by originating motions and summonses for orders dismissing the applicant’s summonses and setting aside the subpoenas. Vickery J decided the two grounds upon which the applicant relied for costs orders against the Firm and the Barrister in two separate judgments. On 18 June 2015, he held that, insofar as the summonses were based on s 29 of the CP Act, the applications under that section were incompetent because they were not made within the time specified by s 30 of the CP Act.[1] That decision is not relevant to the present application.
[1]Kenny v Gippsreal Ltd [2015] VSC 284.
The originating motions and summonses of the Firm and the Barrister in relation to the applicant’s applications for costs orders under r 63.23 of the 2005 Rules were treated as applications by the Firm and the Barrister for summary judgment under s 63 of the CP Act.
On the morning of 18 December 2015, Vickery J published reasons for judgment in which he held: that the applicant’s delay in filing its applications for costs orders against the Firm and the Barrister was ‘unexplained’ and ‘inordinate’ and ‘amounted to a contravention of the overarching purpose of the [CP Act]’; that the delay was an insurmountable barrier to the exercise of the discretion in r 63.23 of the 2005 Rules in favour of the applicant; that, accordingly, the applicant’s applications had no real prospect of success; and that those applications should be summarily dismissed under s 63 of the CP Act.[2]
[2]Kenny v Gippsreal Ltd [No 2] [2015] VSC 737 [62]–[63], [68].
When Vickery J published his reasons on 18 December 2015, the Firm was represented by Christopher Jones, solicitor, and the Barrister was represented by David Klempfner of counsel, but the applicant was not represented by either counsel or a solicitor. Immediately after the reasons were published, the following exchange took place:
Mr Klempfner: As Your Honour pleases. We’re at a bit of a disadvantage in the sense that Mr Evans, who … ought be appearing on behalf of Gippsreal … was unable to make it. … I’ve been in discussions with him.
His Honour: It’s a busy time of year.
Mr Klempfner: It is, he has another commitment, and I make no criticism of him for that. … But what he’s asked of me, and it is not agreed though, is that the question of costs be put off to another day.
His Honour: Yes. Again what I will do is simply adjourn the matter sine die. … And you can then exercise liberty to apply, which you have automatically, to come back to court to deal with those questions in the new year which will be sometime in February.
…
Mr Klempfner: Yes. Just also for the sake of completeness there are subpoenas which were issued in the substantive proceedings.
…
His Honour: Yes. All right. Well, I will make an order then that the subpoenas dated … 3 February 2015 issued in the proceeding be set aside. And I will otherwise adjourn the proceeding sine die.
Mr Klempfner: As your Honour pleases. Thank you.
His Honour: And if you could arrange for orders in that form to be sent to us forthwith.
After the adjournment, at 12.28 pm on 18 December 2015, the Barrister’s solicitor sent an email to Vickery J’s associate and the solicitors for the other parties attaching a draft order which: dismissed the applicant’s summonses dated 22 December 2014 (para 1); dismissed summonses filed by the Barrister which are not presently relevant (para 2); set aside the subpoenas filed on 3 February 2015 (para 3); otherwise adjourned the proceedings sine die (para 4); reserved liberty to apply (para 5); and reserved costs (para 6). In the light of the exchange quoted at [12] above, it is not clear why paras 1 and 2 were included in the draft order. On the same day, following receipt of the email from the Barrister’s solicitor, the applicant’s solicitor sent an email to Vickery J’s associate seeking time to consider the ‘proposed Orders’.
At 10.54 am on 22 December 2015, the Barrister’s solicitor sent an email to the applicant’s solicitor stating that the ‘draft orders were simply produced for the convenience of the court and are not a matter for negotiation between the parties’. At 3.17 pm on 22 December 2015, the applicant’s solicitor sent an email to the Barrister’s solicitor (with a copy to Vickery J’s associate) stating that he was ‘agreeable to the orders being made in the terms drawn’ by the Barrister’s solicitor. However, he requested that the orders not be dated until 24 December 2015 so that he could consult with counsel for the applicant. The Barrister’s solicitor responded by email on the following day (with a copy to Vickery J’s associate) stating that he was not sure whether the request could be accommodated as ‘the orders were in fact made on 18 December’ but that he would leave the matter to be dealt with by Vickery J’s associate.
On 11 February 2016, Vickery J authenticated the following order (‘Substantive Order’):
THE COURT ORDERS THAT:
1[The applicant’s] summonses filed 22 December 2014 in the [First Proceeding and the Second Proceeding] be dismissed.
2[The Barrister’s] summonses filed 27 July 2015 in the [First Proceeding and the Second Proceeding] be dismissed.
3The subpoenas to [the Firm and the Barrister] filed by [the applicant] on 3 February 2015 in the [First Proceeding and the Second Proceeding] be set aside.
4The proceedings be otherwise adjourned sine die.
5There be liberty to apply.
6Costs be reserved.
On 24 February 2016, Vickery J heard submissions in relation to costs. On that day, he made an order requiring the applicant to pay the costs of the Firm and the Barrister on a standard basis (‘Costs Order’).
On 1 March 2016, the applicant filed: a proposed application for leave to appeal against paras 1 and 3 of the Substantive Order and against the Costs Order; its written case; and an application for an extension of time to file the application for leave to appeal. The Firm and the Barrister are the respondents to those applications. The main contentions in the applicant’s proposed grounds of appeal are that, in determining that its applications for costs orders against the Firm and the Barrister had no real prospect of success, Vickery J failed to take into account:
(a) evidence on affidavit which explained the applicant’s delay in commencing the applications for those costs orders; and
(b) the merits of the applications.
Is an extension of time required?
The material before me indicates that the only orders that Vickery J pronounced on 18 December 2015 were that the subpoenas filed on 3 February 2015 be set aside, that the proceedings be otherwise adjourned sine die, that liberty to apply be reserved and that costs be reserved. If this is correct, then an order dismissing the applicant’s applications for costs orders against the Firm and the Barrister was not made until the Substantive Order was authenticated on 11 February 2016. On this basis, an extension of time for filing an application for leave to appeal against para 1 of the Substantive Order is not required. However, an extension of time is required in respect of para 3 of that order.
Notwithstanding the analysis at [18] above, as the parties’ submissions assume that the Substantive Order was made in its entirety on 18 December 2015 and was subsequently authenticated on 11 February 2016, I will proceed on that basis.
The applicant submitted that an extension of time was not required because the 28 day period in r 64.05(1) of the Supreme Court (General Civil Procedure) Rules 2015 (‘2015 Rules’) commenced from the time that the applicant received the Substantive Order, namely on 11 February 2016, rather than when that order was made. This is incorrect, as r 64.05(1)(a) makes it clear that an application for leave to appeal must be filed ‘within 28 days after the decision to which the application … relates was made’.
The Court’s discretion to grant an extension of time
Pursuant to r 64.08 of the 2015 Rules, the Court has a discretion to extend the time for the filing of an application for leave to appeal. As with the exercise of any other discretion by the Court, the Court must seek to give effect to the overarching purpose in s 7 of the CP Act, namely to ‘facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute.’[3] The factors that are relevant to the exercise of the discretion under r 64.08 include the length of the delay, the reasons for the delay, the prospects of the application for leave to appeal succeeding and the extent of any prejudice to a respondent.
[3]See s 8(1) of the CP Act.
In the present case, the respondents have not made any submissions concerning the third and the fourth of the above factors. Accordingly, I will proceed on the basis that those factors are neutral considerations. On this basis, the length of the delay and the reasons for it become critical considerations.
The length of the applicant’s delay and the reasons for it
In accordance with r 3.04(1) of the 2015 Rules, the period from 24 December 2015 until 9 January 2016 is to be excluded in calculating the time at which the 28 day period in r 64.05(1)(a) expired. On the assumption that the Substantive Order was made in its entirety on 18 December 2015, that period expired on 1 February 2016. As the application for leave to appeal was sought to be filed on 1 March 2016, the period of delay is 29 days.
The respondents submitted that the delay should not be viewed in isolation but in the light of the applicant’s inordinate delay in commencing the applications for costs orders against them, which was the basis upon which Vickery J granted summary judgment against the applicant. Considered in this context, the delay of 29 days was said to be excessive.
I do not accept the respondents’ submission that the length of the delay should be informed by Vickery J’s finding of inordinate delay. This is because the applicant seeks to impugn that finding on the basis that, in making it, Vickery J failed to take into account evidence which the applicant contends explained the delay.
In all the circumstances, while the applicant’s delay of 29 days is not minor, it cannot be described as inordinate.
In his affidavit in support of an application for an extension of time, the applicant’s solicitor deposed the following:
(a) While the solicitor had received the draft order on the afternoon of 18 December 2015, he and counsel for the applicant were of the view that an authenticated order was required before leave to appeal could be sought.
(b) On 23 December 2015, the applicant instructed the solicitor that it wished to seek leave to appeal. The solicitor informed counsel for the applicant of these instructions. Counsel was not returning to chambers until mid-January 2016.
(c) On 25 January 2016, Vickery J’s associate advised the parties that he expected that the authenticated order would be provided to the parties early the following week. (This advice was in response to an email dated 12 January 2016 from the Barrister’s solicitor to the associate.) On 8 February 2016, the associate advised the parties that the authenticated order would be provided on 10 February 2016. (This advice was also in response to an email from the Barrister’s solicitor to the associate.) The authenticated order was in fact provided on 11 February 2016.
(d) On 12 February 2016, the parties were informed that the proceedings would be listed for hearing of submissions on costs on either 24 or 25 February 2016. The solicitor and counsel for the applicant agreed to wait until a costs order was made so that a single application for leave to appeal could be made. Vickery J determined the costs issues on 24 February 2016 and the authenticated Costs Order was provided to the parties on 26 February 2016.
(e) The application for an extension of time was filed after the Registrar advised that it was necessary.
The applicant submitted that the delay has been adequately explained and that it was caused by its lawyers rather than the applicant.
The respondents submitted that the applicant has not adequately explained the delay. In particular, the respondents contended that there was no impediment to the applicant acting promptly on its decision of 23 December 2015 to seek leave to appeal or applying for an extension of time immediately after it received the authenticated Substantive Order on 11 February 2016. They also observed that, between 18 December 2015 and 11 February 2016, the applicant took no steps to progress the authentication of the Substantive Order.
In my opinion, the applicant has provided a coherent explanation for the delay, albeit that it was based on an erroneous view of the requirements of the 2015 Rules. The erroneous view was not formed frivolously or irresponsibly but following discussion between the applicant’s solicitor and counsel. Further, due to the January 2016 court vacation and the inability of the judge to authenticate the Substantive Order until 11 February 2016, the parties could not know prior to that date whether the judge had adopted the draft order prepared by the Barrister’s solicitor. Had that order been authenticated earlier, an extension of time may not have become necessary.
The respondents’ criticism of the applicant for not taking any steps to contact the Court to ‘progress’ the authentication of the Substantive Order is unwarranted. This is because the applicant’s solicitor was copied in on emails from the Barrister’s solicitor to Vickery J’s associate and was aware that the Barrister’s solicitor was following up the matter.
In circumstances where the applicant had determined shortly after 18 December 2015 to seek leave to appeal but did not do so timeously due to a genuine mistake by its lawyers and delays on the part of the court due to the January 2016 court vacation, it would be unfair to deprive the applicant of the opportunity to have its application for leave to appeal determined on its merits. Such a determination would give effect to the overarching purpose set out at [21] above.
Conclusion
For the above reasons, I will make an order extending to 1 March 2016 the time within which the applicant may file its application for leave to appeal.
It is arguable that, as the applicant was required to seek an indulgence from the Court through no fault of the respondents, it should pay their costs of the application. However, as the parties did not address the question of costs in any detail, I will order that the costs of the application be reserved.
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