Hennarcobrinni Pty Ltd v Barry

[2000] QSC 466

SUPREME COURT OF QUEENSLAND

CITATION:

Hennarcobrinni Pty Ltd v Barry [2000] QSC 466

PARTIES:

HENNARCOBRINNI PTY LTD
(plaintiff)
v
IAN ROBERT BARRY AND CAROLE BARRY (discontinued)
(first defendant)
and
KOMATE PTY LTD (ACN 010 012 512) (discontinued)
(second defendant)
and
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED
(third defendant)
and
ALAN RICHARD NICHOLS
(fourth defendant)

FILE NO:

S7640 of 1998 Brisbane Registry

DIVISION:

Trial Division

DELIVERED ON:

14 December 2000

DELIVERED AT:

Brisbane

HEARING DATE:

23 November 2000

JUDGE:

Mackenzie J

ORDER:

1.  That the writ issued in Supreme Court Action No 7640 of 1998 be renewed for such periods as are necessary.
2.  That the writ be served upon the third defendant forthwith.
3.  That the applicant plaintiff pay the respondent defendant's costs of and incidental to the application to be assessed, payment of such costs to be postponed until determination or discontinuance of the action.

CATCHWORDS:

PRACTICE – WRIT – RENEWAL – ineffective service – "other good reason for renewal".

Muirhead v The Uniting Church in Australia Property Trust (Q) [1999] QCA 513
Van Leer Australia Pty Ltd v Palace Shipping KK (1981) 180 CLR 337

COUNSEL:

P O'Neill for applicant/plaintiff
T North for respondent/defendant

SOLICITORS:

Gilshenan and Luton for the plaintiff
Minter Ellison for the third defendant

1. MACKENZIE J:  This is an application to renew a writ.  The writ was issued on 18 August 1998 and arose from dealings between the respondent third defendant and the applicant who operated a motel in Tenterfield and had borrowed moneys on mortgage from the respondent.  A contract of sale of the property was entered into.  It is alleged that an employee of the respondent, Mr Minnett, persuaded Mr and Mrs Schipp, the directors of the applicant, to let the purchaser into possession prior to settlement.  The contract failed to settle and eventually the respondent appointed a receiver and manager of the applicant's assets under the securities.  The applicant has sought a variety of forms of relief against the respondent in consequence of losses which were suffered. 

1. There are several issues as to whether some of the causes of action pleaded are statute barred.  The nature of the arguments is set out in Mr North's outline.  It is unnecessary to do more than note that those arguments exist for the purposes of this application. 

1. Service was not attempted until, probably, 16 August 1999.  It was attempted at the respondent's offices in Queen Street, Brisbane but evidence suggests that an unidentified employee of the respondent directed the server to an office at South Brisbane where the document was signed for on 17 August 1999 as if service had been effected there.  It is conceded, however, that the writ should have been served at the respondent's registered office in Melbourne to comply with the Service and Execution of Process Act 1992. 

1. Because of the lateness of the attempt to serve the writ, which was said to be due to the impecuniosity of Mr and Mrs Schipp, the writ was stale by the time the respondent's solicitors drew attention to the ineffective service on 13 September 1999.

1. Correspondence was engaged in with a view to ascertaining whether the respondent would waive the irregular service but by 7 October 1999 the applicant's solicitors had been advised that an application for renewal should be made to the court and would be opposed.  It is not clear why in accordance with rule 24, the matter was not taken before a Registrar.  However, there was no issue about that at the hearing. 

1. From 26 April 2000 onwards there was further correspondence in which it was asserted that the applicant had been misled by an employee of the respondent into thinking that service could be effected in Brisbane, and in which the respondent maintained that it would still oppose the application.  This advice was given on 14 July 2000.  It is also put forward as justification for the irregular service that on an occasion when the applicant had to be restored to the register after having been struck off, the application had been served without complaint in Brisbane. 

1. The action has progressed at an unsatisfactory pace, but in mitigation it is said that impecuniosity caused by the events which led to the action is the reason.  It is submitted that the delay of about 15 months in bringing the present application was attributable to the hope that the need to do so might eventually be avoided. 

1. The respondent submitted that reasonable effects had not been made to serve the writ and that the applicant had failed to demonstrate "another good reason" to renew the claim.  Notwithstanding Mr O'Neill's argument that the particular circumstances of the case would support the conclusion that reasonable efforts had been made to effect service, I do not think that that proposition is made out.  The need to serve in accordance with the Service and Execution of Process Act appears not to have been appreciated, and the fact that service was attempted only immediately before the writ became stale left no margin for error.

1. It is necessary then to consider whether any other good reason to renew the writ is established.  It was accepted that there is a tendency to relax rigid time limits where that is legally possible and where it can be done without prejudice or injustice to other parties.  It was also accepted that the discretion may be exercised although the statutory limitation period has expired.  Matters to be considered include the length of delay, the reasons for it, the conduct of the parties and the hardship or prejudice caused to the plaintiff by refusing renewal or to the defendant by granting it.  It was accepted that there was a wide and unfettered discretion and there is "no better reason for granting relief than to see that justice is done".   

1. Those propositions are to be found in Muirhead v The Uniting Church in Australia Property Trust (Q) [1999] QCA 513. They are described by Pincus JA there as a summary of the reasons expressed by Stephen J in Van Leer Australia Pty Ltd v Palace Shipping KK (1981) 180 CLR 337.

1. Mr North also submitted for the respondent that where the limitation period had expired the relevant principles were no different from those which were relevant to an application to extend the limitation period or for leave to proceed when no step had been taken in the action for 12 months and the limitation period had expired.  He submitted that it was for the applicant to establish some good reason why the case should be excepted from the general rule that the court would not exercise its discretion in favour of renewal.

1. He submitted that it was for the applicant to satisfy the court that an order would not result in significant prejudice to the defendant.  He submitted that availability of an alternative remedy against the solicitor for the plaintiff was a relevant circumstance when considering whether or not there was "other good reason" for renewing the claim.  He also submitted that the applicant's position in this case was not as strong as that in Muirhead, where the applicant failed in the Court of Appeal.

1. Mr North also relied on the claim of significant prejudice to the respondent.  The principal factors relied on were the lapse of time since relevant events occurred and the aggravating circumstance that diary notes kept by Mr Minnett, who is alleged to have given the relevant advice to allow the purchaser into possession, are unable to be found.  Mr Minnett deposed that he had a practice of keeping detailed diary notes of conversations and events that occurred with respect to accounts under his control.  He did keep such notes with respect to the relevant file because when he took it over, he regarded it as a potentially difficult one.  He deposed that he had not seen the notes for many years, the last time being at the bank at or about the time when he last had any involvement with the account.

1. He recalled travelling to Tenterfield on one occasion with Mr Dawson another bank officer for the purpose of interviewing Mr and Mrs Schipp.  He said that he spent a considerable period of time with them that day and recalls preparing a diary note of those conversations while they were fresh in his mind.  He deposes that he now has a general recollection of the conversations that day but with the passage of time his memory has faded.  He believed that if his memory was refreshed he would be much more confident of his recollection with respect to the conversations.  He would be able to be much more precise and accurate in giving evidence about them if he had access to the notes.  He also said that he recalled a subsequent conversation by telephone with Mrs Schipp in which she asked whether the bank had an objection to allowing the purchaser to take possession of the motel.  He had no specific recollection of diarising that note but believed he would have followed his usual practice.

1. Once again he said that he had a general recollection of the substance and effect of what was discussed on that occasion but was unsure of precisely when it took place.  He believed his recollection of it would be greatly enhanced if he could have reference to his diary notes.  He expressed the view that he felt disadvantaged by not having been able to refer to the notes although he had provided the statement to the respondents' solicitors since the commencement of the action. 

1. The effect of his evidence is that he was accustomed to keep detailed notes.  He has a general recollection of the conversations but with the passage of time he memory has faded.  The precision and accuracy of his evidence on critical issues will be not as good as it would be with the assistance of the notes.  He has some recollection of the conversations but feels that his memory would be enhanced by the notes. 

1. There is also evidence from Mr Dawson who says that the meeting with Mr and Mrs Schipp which he attended was for the purposes of introducing Mr Minnett to them at a time when he was handing the file over to Mr Minnett.  Mr Dawson cannot recall what was said or what happened during the interview with any confidence.  He could not recall if he had made a diary note. 

1. Except to the extent that the affidavit of Mr Caridi suggests that files relevant to the applicant cannot be found there is no specific claim that notes which may enhance Mr Dawson's memory will be unable to be found.  The loss of recollection with the passage of time is all that can be derived from Mr Dawson's affidavit. 

1. The case is one which will depend on recollections of conversations.  In the absence of notes made at the time, the respondent will be at some disadvantage although it seems to be the case that Mr Minnett has some recollection independently. 

1. Having said that, the critical conversation as to letting the purchasers into possession seems limited in scope and it is therefore difficult to imagine that the degree of disadvantage is as great as it might be if the conversations were long and complex.  This is especially so as Mr Minnett has an independent recollection that the initiating role in relation to the conversation about doing so was Mrs Schipp's.  It may turn out to be simply a question of deciding which of essentially opposed versions of what happened is more reliable.  While there is the possibility of some prejudice, I do not think that it is such as to disentitle the applicant to relief, standing alone. 

1. The case has a number of unusual features.  In addition to the factors relating to the apparent acceptance of service in Brisbane on 17 August 1999, and the apparent acceptance of service of a preceding application without demur, there is also the factor that the respondent has, since the dispute about service, proceeded to disclosure of documents.  Admittedly that was done concurrently with maintaining the attitude that it was necessary to seek renewal of the writ.  Nevertheless, the circumstances are less striking in favour of the respondent than they might otherwise be.

1. The remaining aspect, the possibility of a cause of action against the solicitors, does not, in my view, assume a critical importance in this particular case.  On balance it is my view that the case is one where renewal of the writ for such periods as is necessary should be allowed. 

1. The orders are:

1.        That the writ issued in Supreme Court Action No 7640 of 1998 be renewed for such periods as are necessary.                

2.        That the writ be served upon the third defendant forthwith.

3.        That the applicant plaintiff pay the respondent defendant's costs of and incidental to the application to be assessed, payment of such costs to be postponed until determination or discontinuance of the action.