Hub Properties Pty Ltd v Namba Pty Ltd
[2003] VSC 300
•18 August 2003
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
No. 5199 of 1997
| HUB PROPERTIES PTY LTD CLASSIC PAVING PTY LTD C. AMORE & SONS CONSTRUCTION PTY LTD DANIELLA AMORE | First Plaintiff Second Plaintiff Third Plaintiff Fourth Plaintiff |
| v | |
| NAMBA PTY LTD CENTRAL FOOD SERVICES PTY LTD ANTHONY BINI MAXWELL DI RUSSO | First Defendant Second Defendant Third Defendant Fourth Defendant |
| AND | |
| SALVATORE GURCIULLO | Third Party |
---
JUDGE: | OSBORN J | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 12 AUGUST 2003 | |
DATE OF JUDGMENT: | 18 AUGUST 2003 | |
CASE MAY BE CITED AS: | HUB PROPERTIES PTY LTD & ORS v NAMBA PTY LTD & ORS | |
MEDIUM NEUTRAL CITATION: | [2003] VSC 300 | |
---
Appeal from Master – Application to strike out claims for want of prosecution – Inordinate and inexcusable delay – Prejudice – Where defendant a solicitor.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs | Mr H.A. Aizen | Hughes Lawyers |
| For the Third Defendant | Mr G. McEwen | Minter Ellison |
HIS HONOUR:
This is an appeal from an order of Master Evans made upon an application by the thirdnamed defendant to strike out the plaintiffs' claim for want of prosecution. On 3 April 2003 the Master ordered that:
(1)The thirdnamed defendant's application by summons filed 26 November 2002 is dismissed.
(2)The thirdnamed defendant pay the plaintiffs' costs of the application.
(3)The plaintiffs file and serve the amended writ and amended statement of claim pursuant to leave granted by Master Wheeler on 24 July 2000 on or before 11 April 2003.
(4)The plaintiffs take such steps as they may be advised to enable inspection of documents identified in the plaintiffs' affidavit of documents dated 28 July and 29 July 1998, each dated 7 June (2) and the third affidavit of documents dated 29 July 2001, by 30 April 2003.
(5)The proceeding is listed for directions on 2 June 2003 at 10.30 a.m. in the Master's Court No. 2, Ground Floor, 436 Lonsdale Street, Melbourne.
The appeal before me is one by way of rehearing de novo pursuant to r.77 of the Rules of the Supreme Court.
The proceeding was commenced by writ on 24 April 1997. The claims made in it arise out of the failure of the first and secondnamed defendants to repay loans made in 1996. Master Evans summarised the claims as follows.
"2.The first loan was made by the first plaintiff ('Hub') to the first defendant ('Namba') pursuant to a loan agreement made on or about 13 August 1996. That agreement was partly oral. In so far as it was so constituted the third defendant ('Bini') and another negotiated it on behalf of Namba on 6 August 1996.
3.The loan was to be secured by registered second mortgages over two properties owned by Namba. Bini orally represented to Hub in mid to late July and again on 23 July 1996, inter alia, that there was more than sufficient equity in those properties to cover the proposed loan. 'In or about the end of July or the beginning of August 1996' Hub retained Bini, a solicitor, to prepare the second mortgage. The retainer was constituted in part by a conversation between him and one Canzoneri on behalf of Hub on 23 July 1996.
4.Bini prepared the mortgage and orally represented to Canzoneri on 13 August 1996 that it was 'in order' and that the loan 'could properly be advanced'. The loan was repayable at call after thirty days. On 12 December 1996 Hub demanded repayment of the loan but Namba has failed to repay it. Hub claims that the representations were false and misleading and seeks relief under the Trade Practices Act and the Fair Trading Act against Bini in respect of them. They are said to be false because neither property was 'available to be a security to support the first loan by way of second mortgage security'. Hub also alleges that Bini owed it a duty of care and was negligent in failing
(a) to carry out up to date title searches of the properties
(b)to advise Hub that the properties were already subject to second mortgages [it is not alleged specifically that he knew that this was so at any relevant time]
(c) to lodge the mortgage
(d)to advise Hub that the fourth defendant ('Di Russo'),the effective controller of Namba, had been charged with several serious criminal charges arising out of the procuration of a bank cheque, as Bini well knew.
5.The second loan was made by the second plaintiff ('Classic') to Namba and the second defendant ('Central') pursuant to a loan agreement made between them on or about 7 October 1996. That agreement was partly oral and to that extent consisted of discussions to which Bini as a representative of Namba and Central was a party. The loan was to be secured by a third mortgage over Namba's properties and by a second mortgage over properties owned by Central. In or about early October 1996 Bini orally represented and confirmed to Canzoneri his earlier written statement that Central's properties were owned by it and subject to a first mortgage was true and correct. Classic retained Bini to prepare those (second and third) mortgages on or about 4 October 1996. The retainer was partly oral and to that extent was constituted by a discussion between Canzoneri and Bini in or about early October 1996. Bini prepared the mortgages and on 8 October 1996 (cf particulars 7 October) represented orally to Canzoneri that a search of the titles to Central's properties had been undertaken, that they were 'in order'; that the mortgages were 'in order' and that the second loan could properly be advanced.
6.The second loan was repayable at call after 30 days. It was made on an unspecified date in October 1996 and repayment of it was demanded on 26 November 1996. Central and Namba failed to repay the loan. Similar causes of action in negligence and under the Trade Practices Act and Fair Trading Act are alleged against Bini in relation to the second loan."
In answer to these claims the thirdnamed defendant denies that he was ever retained by the plaintiffs to act as solicitor on their behalf. Indeed Mr McEwen indicated that it is asserted inter alia on behalf of the thirdnamed defendant that letters purporting to evidence such a retainer were fabricated after the loans went bad. It is further asserted that this can be demonstrated from the relevant computer records. In addition the thirdnamed defendant specifically denies making misleading, deceptive or negligent statements to the plaintiffs.
The history of the proceeding has been tortuous and is chronicled up to 26 November 2002 in an 85 paragraph procedural chronology exhibited to an affidavit sworn in support of the summons by the thirdnamed defendant's solicitor. I shall annex that chronology (omitting attachments) as a schedule to these reasons.
The third and fourthnamed plaintiffs were added in the course of the proceeding and claim pursuant to an alleged assignment of the first and secondnamed plaintiffs' causes of action with respect to the first loan. It is alleged this assignment was effected by a deed under seal made on 12 September 1998. The thirdnamed defendant denies that an assignment occurred as alleged.
When the matter came before Master Evans he was satisfied of the following matters:
"(a)at (early April 2001) … there had been a failure, still unexplained, of the plaintiffs (including the added plaintiffs) to take any steps to prosecute the proceeding for the previous eight months. At the beginning of that period the proceeding had been on foot for three years and three months. Such a failure must be regarded as significant regardless of the reasons why the proceeding had been delayed until the beginning of that period: para 22;
(b)But for an abortive attempt to persuade Master Bruce to order a new timetable for interlocutory steps in March 2002 nothing has been done by the plaintiffs to prosecute the proceeding since December 2001. Such a delay in the context of a proceeding commenced in April 1997 in which there had already been an 8 months delay in prosecution could only be described as inordinate: para 29;
(c)… there is no satisfactory explanation before the court as to the circumstances leading to the termination of that retainer (ie of Isaac Brott & Co). It is clear that the dispute over counsels' fees and the costs claimed by Isaac Brott & Co has not been resolved. There is no evidence of any positive steps by the plaintiffs since the termination of that firm's retainer almost 3 years ago to bring that dispute to a head such as seeking taxation of the costs or a proceeding designed to test that firm's claim to a lien over the plaintiffs' file including original documents necessary to the prosecution of the plaintiffs' case: para 33;
(d)There is a singular failure on the part of the plaintiffs to adduce evidence as to whether or not advice was sought from and/or given by any of their solicitors as to their rights in relation to the retention of the file by Isaac Brott and as to the steps that should be taken to obtain it from him. It would be remarkable if it had not been sought and received given the fact that those solicitors had all complained of the difficulty caused by that problem: para 38;
(e)I have somewhat reluctantly come to the conclusion on the evidence before the court the delays in this proceeding are inexcusable: para 39."
There is no dispute before me that the Master was correct in finding that the plaintiffs have been guilty of inexcusable delay. Further, I accept Mr McEwen's submission that the plaintiffs' delay included an initial period of one year between 30 July 1998 and 19 August 1999 not identified in the Master's reasons, and a period of approximately six months between June 2001 and December 2001 also not identified in the Master's reasons.
In addition it appears from an affidavit tendered on behalf of the plaintiffs pursuant to special leave granted under r.77.07 that no satisfactory steps have been taken pursuant to orders made by the Master. An exchange of letters has occurred between the plaintiffs' solicitors and their former solicitors Isaac Brott & Co, but no inspection of documents has occurred within the time-line envisaged by the order of Master Evans. In these circumstances I am satisfied that there has been inordinate and inexcusable delay on the part of the plaintiffs and/or the plaintiffs' solicitors in the conduct of the proceeding. The history of the plaintiffs' representation is itself symptomatic of this fact, involving as it does five different firms of solicitors and two periods in the course of 2002 during which the plaintiffs were unrepresented.
The power to dismiss a proceeding for want of prosecution either under r.24.05 of the Rules of the Supreme Court or in the inherent jurisdiction of the Court is discretionary. The guiding principle for the exercise of the discretion is that an order for dismissal should be made if the justice of the occasion demands it.
The authorities further articulate well established guidelines as to when such discretion should be exercised. The relevant principles governing the discretion to strike out a proceeding for want of prosecution were summarised by Lord Griffiths in Department of Transport v Chris Smaller (Transport) Ltd[1] as follows:
""The power should be exercised only where the court is satisfied either (1) that the default has been intentional and contumelious, e.g. disobedience to a peremptory 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 is such as is likely to cause or 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."
[1][1989] 1 AC 1197 at 1203
The application of these principles has been elaborated by the Full Court in Bishopsgate Insurance Australia Ltd (In Liq.) v Deloitte Haskins & Sells[2] and by the Court of Appeal in Masel v Transport Industries Insurance Co Ltd[3]; and Spitfire Nominees Pty Ltd v Ducco[4].
[2][1999] 3 VR 863 (Decision delivered 9 September 1994)
[3][1995] 2 VR 328
[4][1998] 1 VR 242
In Masel the Court of Appeal stated:
"We have earlier referred to the adoption by the Full Court in Bishopsgate of the recent formulation of the principles by Lord Griffiths in Chris Smaller's case. The principles so formulated have guided judges in this state for a good many years. They are extremely useful and important guidelines and in the great majority of cases will be found sufficient to dispose of the case. But, as we hope the lengthy reference to authority has made clear, those guidelines do not mean that once inordinate and inexcusable delay resulting in prejudice (including the risk of an unfair trial) is shown the action must in all circumstances be dismissed for want of prosecution. In practice cases will rarely arise in which it can be said that in all the circumstances, notwithstanding findings which bring the guidelines into operation, justice does not on balance demand that the action be dismissed. For the terms of the guidelines are such as to make it extremely unlikely in practice that a judge who determined that an applicant had shown what they require to be shown would nevertheless determine that in all the circumstances justice did not require the dismissal of the proceeding. But in what will no doubt be rare cases this conclusion may be reached."[5]
[5][1995] 2 VR 328 at 336
In the present case the thirdnamed defendant relies both upon prejudice with respect to the possibility of a fair trial and more particularly prejudice with respect to his professional life as a solicitor.
The affidavit sworn in support of the summons to strike out the proceeding put the position with respect to a fair trial as follows:
"30.Further the allegations in the statement of claim concern oral representations allegedly made between July and October 1996. The facts of this case are based upon the recollection of witnesses and events and conversations that occurred over six years ago. Since that time the third defendant has dealt with many files and has been involved in many other transactions. There is therefore a substantial risk that a fair trial may not be had in this proceeding as a result of the inordinate and inexcusable delay on the part of the plaintiffs in producing documents that have been ordered by the court to be produced and in prosecuting this proceeding generally."
The Master took the view:
"42.Allowing 4 months from pre-trial directions to trial the proceeding could come on for trial in 2004, some 7 years after the events to which it relates. It is true that memory will fade over such a long period. However this proceeding was launched 8 months after those events and while they were relatively fresh in Bini's mind. Further it seems from his affidavit of documents that he maintained file notes of relevant conferences and phone conversations as one would expect of a prudent solicitor. They will serve as useful aides memoires. They should eliminate the risk that Bini will confuse the relevant files and transactions with those he has dealt with since. There is no suggestion that the memories of others upon whose evidence the defence will depend are likely to have been affected. In those circumstances it seems unlikely that there is a real risk of prejudice to him in the conduct of his defence by reason of fading memory."
Mr McEwen submitted on behalf of the thirdnamed defendant that the reasoning of the Master was unsatisfactory because critical arrangements are alleged by the plaintiffs to have been effected at informal meetings at cafes and restaurants, where one would not expect the thirdnamed defendant to have made notes of the relevant conversations. Ultimately, however, the thirdnamed defendants' case is one of denial with respect to these arrangements and it is difficult to see that his position with respect to such denials is materially affected by the delay in issue.
A subsidiary series of arguments as to prejudice with respect to a fair trial were also mounted by reference to the issue of discovery. It was submitted:
(a)the thirdnamed defendant had been denied the opportunity to inspect the original deed of assignment upon which depends the entitlement of the third and fourthnamed plaintiffs to continue the claim;
(b)no discovery has been made of documents demonstrating payment in accordance with the terms of that deed (a copy of which has been discovered);
(c)correspondence between the plaintiffs' solicitors and its former solicitors demonstrates the plaintiffs have failed to make full and proper discovery.
The plaintiffs have provided discovery of a photocopy of the relevant deed of assignment and I am not satisfied the defendants have suffered material forensic prejudice as a result of the failure of the plaintiffs to hitherto produce the original. Likewise if the plaintiffs have failed to discover documents demonstrating performance of obligations under the deed of assignment, that is ultimately a matter which is difficult to regard as prejudicial to the thirdnamed defendant. The question of the adequacy of discovery of documents held by the plaintiffs' former solicitors raises more complex issues (to which I shall return). In my view, however, it cannot of itself be shown at this point in time to give rise to prejudice justifying the striking out of the plaintiffs' claim for want of prosecution.
The primary case as to prejudice brought on behalf of the thirdnamed defendant was not, however, with respect to the question of a fair trial. It was that during the course of the proceeding the effect of ongoing and unresolved allegations of professional negligence and misconduct has caused and will cause him special prejudice. The affidavit in support of the summons states:
"29.The claim involves the third defendant's probity and professional competence and the claim is substantial. The third defendant is a practising solicitor and has been exposed to allegations of negligence and making false misrepresentations through a protracted period of time."
The Master concluded with respect to this aspect of the matter:
"43.The question which then arises is – whether or not the defendant has suffered prejudice as a solicitor or as an individual or is likely to be caused such prejudice by being exposed to this litigation or the particular allegations made in it against him for such a long period. A suit for negligence against a solicitor is naturally a matter for concern but such suits have become almost a normal incident of legal practice in recent years. Given the scheme for compulsory insurance in respect of such a proceeding the exposure to the proceeding for a lengthy period ought not be the occasion of such prejudice as would warrant its dismissal. There is no evidence that Bini had been exposed to adverse publicity or professional opprobrium by reason of the allegations made in this proceeding.
44.The allegations in the proceeding, however, go beyond allegations of negligence. Allegations of misleading and deceptive conduct are also made. Such allegations must be of serious concern to Bini as a solicitor and as a person. However these allegations do not include allegations that he knowingly misled and deceived the plaintiffs. This distinction may be too fine for a lay person to appreciate but I have no doubt it is one which Bini understands. In the absence of attendant publicity which might well give rise to adverse comment and affect his reputation I am not satisfied that his natural concern at being exposed to such allegations over such a long period is such as to warrant dismissal of the proceedings at this stage."
Mr McEwen attacked this conclusion on two principal bases:
(a)it was said that the Master erred in requiring direct evidence of prejudice to the thirdnamed defendant's reputation. There is no doubt that such prejudice may be inferred in an appropriate case.[6] I do not, however, read the Master's reasons as doing more than stating the nature of the evidence before him. The Master's reasons do not indicate that he was of the view that prejudice in the relevant sense could not be inferred in an appropriate case, rather he was not satisfied prejudice had been established in the present case.
(b)it was said that the Master erred in drawing a distinction on the basis that this was not a case in which it was alleged the thirdnamed defendant "knowingly" engaged in misleading and deceptive conduct. Once again in my view the Master did no more than characterise the case before him. His reasons are not to be regarded as stipulating a precondition to prejudice.
[6]See Bishopsgate Insurance Australia Ltd (In Liq.) v Deloitte Haskins & Sells at 875-876
The real question for this Court upon an appeal by way of hearing de novo is, however, whether it is itself satisfied of prejudice in the relevant sense. The relevant concept was articulated in Bishopsgate as follows:
"This is, however, not a case where the only prejudice to be suffered by the defendant is in conducting its case at the trial. As we have already pointed out, a significant potential area of prejudice is that which a defendant suffers by reason of being placed at risk for many years, from the time proceedings are issued, in relation to a serious claim against it. Again, there is no direct evidence but the inference of additional prejudice caused by the plaintiff's delays is one which may be drawn as a matter of commonsense from the circumstances of this particular claim. Every case exposes defendants to risk and in complex cases that risk may extend over a number of years. But the nature of the claim and the potentiality for prejudice must be looked at in the light of the claims made. Where a claim is made against individuals relating to their probity or their competence, especially their professional competence, and the claim is for many millions of dollars, then it is not hard to infer that defendants against whom such allegations are made are under a heavy burden. When that burden is not merely deferred but then unjustifiably drawn out over many years, it is easier still to infer serious prejudice of the relevant kind to a defendant. It has sometimes been said that where a defendant is insured or likely to be insured then the prejudice is not so great and the risk of litigation has been said not to be so great in cases of compulsory insurance, such as that applicable to motor accidents, especially where the premiums cannot be increased if the plaintiff is successful. But where a claim extends beyond mere casual negligence to acts which reflect upon the competence or probity of a defendant, especially when that competence or probity is critical to the defendant's future livelihood, then the delay in bringing an action on for hearing will properly be held to impose severe additional prejudice on a defendant. This is particularly the case in claims alleging professional negligence, although such a description is not to be confined merely to the negligence of accountants, solicitors, doctors and the like for it is relevant to any person in respect of whom an unfavourable finding will be likely to place at risk his or her capacity to earn a living. No doubt this case, without delays, would have hung over the defendant's head for up to three years. We are, however, primarily here concerned with the additional and quite unnecessary burden imposed in the later years while awaiting trial. Thus, it is not so much the size of the claim as the effect on a person's reputation which is critical to prejudice of this kind. Nor are we suggesting that mere anxiety is sufficient, for that has been said to be a matter upon which too much weight should not be rested. See generally e.g. Duncan v. Lowenthal at 187-188, ANZ Banking Group v. Donovan at 13, Biss v. Lambeth, Southwark and Lewisham Area Health Authority [1978] 1 WLR 382 at 389; [1978] 2 All ER 125 at 130-1, Chris Smaller (Transport) case at 1208-1210."[7] (emphases inserted)
[7]Ibid at 887
These principles were further discussed in Spitfire Nominees Pty Ltd v Hall & Thompson[8] an unreported decision of the Court of Appeal subsequent to Spitfire Nominees Pty Ltd v Ducco. Charles JA accepted that the claim there in issue plainly reflected on the competence and probity of the solicitor involved and to that extent was relevant and entitled to at least some weight. In the circumstances of the case, however, he expressed the view that it was not a factor to which he himself would have attached great weight. In my opinion it is clear that the Court must address the particular circumstances of each case before the inference of prejudice is drawn and for the purpose ultimately of concluding whether as a matter of discretion any such prejudice is such as to warrant striking out of the action.
[8][2001] VSCA 245 decision as revised on 4 February 2002
In the present case I am not satisfied that the mere fact of the continuation of proceedings involving allegations as to the thirdnamed defendant's conduct in his profession does give rise to an inference on the balance of probabilities that he has or will suffer prejudice sufficient to warrant striking out the proceeding. In this regard I note the following:
(a)there is no evidence as to the nature of the thirdnamed defendant's practice as a solicitor;
(b)there is no evidence that the thirdnamed defendant's practice is dependent upon his professional reputation generally or with any particular class of persons;
(c)it is possible that an individual solicitor could suffer prejudice to the conduct of his practice in the circumstances of a claim such as the present one but there is no evidence of actual prejudice being suffered or of specific circumstances giving rise to the probable inference that prejudice has or will be suffered;
(d)the nature of the allegations made against the thirdnamed defendant is not such as to necessarily carry with it the probability that the thirdnamed defendant has or will suffer prejudice in the conduct of his professional practice whatever be its character;
(e)the continuing nature of the threat of litigation is not itself sufficient to establish prejudice. In one sense the delay in the plaintiffs' claim reflects upon the credibility of that claim and this might be regarded as progressively diminishing any prejudice the plaintiff could potentially suffer;
(f)the claim is not one of such a nature as to carry with it a commercial threat to the ongoing viability of the thirdnamed defendant's practice.
It follows that I am not satisfied in the circumstances of this case that the thirdnamed defendant has established prejudice sufficient to justify an order for striking out the proceeding for want of prosecution.
I am therefore left with the question of what further or other directions should be given to expedite the matter. The forthnamed plaintiff's affidavit in opposition to the summons stated:
"The plaintiffs will, in the event of no order being made against them sought by the third defendant, seek to bring this matter on for hearing as soon as possible. I will seek advice as to whether non party discovery can be obtained from Isaac Brott & Co in respect of documents retained by that firm and am prepared to, subject to that deficiency, abide by a strict timetable to enable the matter to be litigated as quickly as possible. The plaintiffs will, within a short time, attend to the matters referred to in paragraph 16 of Evans' affidavit."
Paragraph 4 of the Master's order clearly responded to these issues.
The subsequent exchange of correspondence between the plaintiffs' solicitors and their former solicitors tendered in evidence to me included the following statement in a letter from Isaac Brott & Co:
"23.In order to assist your client has shown good faith [sic] and we will allow an inspection by Mr Bini of the files on condition that your clients firstly indicate that they allow that inspection and in fact direct this firm to provide such an inspection and that in fact all the parties meaning the plaintiffs and the third party provide such direction as obviously there are professional privileges involved as well you are to provide a list of precisely what he is to inspect and what we should allow him to inspect. If we in fact simply allow him to inspect the entire file that would include matters that we would imagine that you should be concerned about, which impact on the matter of professional privilege and certainly would not assist advancing of clients cause."
The plaintiffs have not sought to take advantage of this offer to progress the question of discovery, because as their counsel admitted it was not desired to incur further costs while the current appeal hung over the proceeding. An appeal such as the current appeal does not stay the action. The failure of the plaintiffs to progress the matter properly since the Master's order is entirely unacceptable.
Counsel for the thirdnamed defendant submitted that it was apparent from the correspondence from Isaac Brott & Co that the plaintiffs had not given full discovery. An examination of the affidavit of documents sworn on behalf of the plaintiffs by the thirdnamed plaintiff on 29 June 2001 demonstrates this to be so. There is no reference to documents held by Isaac Brott & Co other than the deed of assignment dated 12 September 1998.
This Court has jurisdiction to order a solicitor claiming a lien over documents to produce them.[9] Indeed it has power to order discovery from a non-party under r.32.07 of the Rules of the Supreme Court.
[9]Jamieson v Allen (1863) 2 W & W (E) 47; Re Hawkes Akerman v Lockhart (1898) 2 Ch 1
In the circumstances the appeal will be dismissed and the Master's order will stand but I propose to order that the third and fourthnamed plaintiff make, file and serve within 28 days a further and better affidavit of documents with respect to the documents relevant to this proceeding held by Messrs Isaac Brott & Co and that the matter be listed for further directions before a Master at the conclusion of this period.
I will hear counsel as to the question of costs.
---
Procedural Chronology
On 24 April 1997, the plaintiffs instituted the current proceeding by writ and statement of claim.
On 30 May 1997, the first and fourth defendants filed and served their defence to the writ and statement of claim.
On 10 June 1997, the court ordered, amongst other things, that all parties make discovery on or before 5 September 1997. Orders were also made for the serving and answering of interrogatories and any request for further and better particulars.
On 15 July 1997 the third defendant was served with the writ and statement of claim.
The third defendant filed and served his defence on 4 September 1997.
On 17 February 1998, the court ordered, amongst other things, that all parties complete discovery by 24 April 1998. Master Kings ordered that the plaintiffs pay the third defendants costs of the day.
On 13 March 1988 the third defendant issued a summons for an Anton Pillar order against Saccuzzo Larsen & Co. This summons was heard by The Honourable Justice Beach on 17 February 1998. An order in similar terms to the summons was made and executed on 18 March 1998.
On 6 July 1998 the third defendant served the plaintiffs with an unsworn affidavit of documents noting that particulars of jurat would follow shortly thereafter. The third defendants affidavit of documents was sworn on 14 September 1998 and was served shortly afterward.
On 27 July 1998 Minter Ellison wrote to the court requesting that the matter be brought back on for further directions. A copy of Minter Ellison's letter is attached to this chronology and marked 'C1'.
10. On 28 July 1998 the first plaintiff filed an affidavit of documents. On 29 July 1998 the second plaintiff filed an affidavit of documents.
11. On 31 July 1998 the Court ordered that a proposed further timetable be exchanged between the parties by 7 August 1998 and that a further directions hearing take place on 14 August 1998.
12. On 13 August 1998, Minter Ellison wrote to Isaac Brott & Co, then solicitors for the plaintiffs, requesting consent to a number of further orders in order to avoid an unnecessary appearance at court on the following day. A copy of Minter Ellison's letter dated 13 August 1998 is attached to this chronology and marked 'C2'.
13. Minter Ellison did not receive any response from the plaintiffs to its letter dated 13 August 1998, and accordingly the directions hearing went ahead on 14 August 1998.
14. On 14 August 1998, the court made further interlocutory orders including orders in respect of any request for further and better particulars of any pleading, interrogatories and mediation.
15. On 16 October 1998 the third defendant was given leave to amend its defence and issue third party proceedings against Salvatore Gurciuillo. The third defendant issued a third party notice against Salvatore Gurciuillo on 22 October 1998.
16. On 22 November 1998, the third party filed a defence to the third party notice. Isaac Brott & Co were also acting for the third party.
17. On 21 December 1998, Minter Ellison wrote to Isaac Brott & Co suggesting that the parties agree to a further interlocutory timetable for the proceeding. In order to avoid an unnecessary court appearance. A copy of Minter Ellison's letter dated 21 December 1998 is attached to this chronology and marked 'C3'.
18. Minter Ellison did not receive any response from Isaac Brott & Co to its letter dated 21 December 1998. Accordingly, Minter Ellison wrote to the court on 24 December 1998 requesting that the matter be brought before Master Bruce for a further directions hearing as soon as possible. A copy of Minter Ellison's letter dated 24 December 1998 is attached to this chronology and marked 'C4'.
19. On 18 January 1999, the Honourable Justice Teague ordered that the matter be brought back on for directions on 18 February 1999.
20. On 18 February 1999, the Court ordered a timetable for the third party proceedings and ordered that by 15 March 1999 any party make inspection of documents discovered.
21. On 9 March 1999 the third party filed its affidavit of documents. The third party's affidavit of documents was identical to the plaintiffs' affidavit of documents. The two affidavits of documents even contained the same spelling errors.
22. On 29 March 1999, Ms Janet Lambrou of Minter Ellison went to the offices of the solicitor for the third party to inspect the third party's discovery.
23. On 7 May 1999, Minter Ellison wrote to Isaac Brott & Co the then solicitor for the plaintiffs and third party, seeking an explanation as to why the third party's affidavit of documents was identical to the plaintiffs' affidavit of documents. A copy of Minter Ellison's letter dated 7 May 1999 is attached to this chronology and marked 'C5'.
24. On 19 May 1999 Master Kings ordered the proceeding be listed for a directions hearing before Master Bruce on 24 June 1999.
25. On 16 July 1999, the third defendant issued a summons seeking, amongst other things, an order requiring the third party to make proper discovery in the proceeding. It was listed to be heard on 23 August 2002 at 5:30 pm on the working day before the application was due to be heard the third party filed and served a supplementary affidavit of documents. On 23 August 1999, at the hearing of the third defendant's summons dated 16 July 1999, the summons was adjourned sine die and the plaintiffs and the third party were ordered to pay the costs of the third defendant.
26. On 20 August 1999 the plaintiffs and third party issued a summons. The defendant (not specific) to make further and better discovery. The application was adjourned to 24 September 1999.
27. On 24 September 1999 the plaintiffs and third party's summons dated 20 August 1999 was adjourned sine die and the timetable in relation to interlocutory steps was extended.
28. On 27 October 1999, a receiver and manager was appointed to the first plaintiff - Hub Properties Pty Ltd. No notice of this appointment was given to the third defendant but it appears from Minter Ellison's file that this was mentioned at mediation on 3 December 1999. The mediation took place at the third defendant's instigation.
29. On 14 February 2000, the third defendant issued a summons seeking, amongst other things, security for costs from the plaintiffs.
30. On 12 April 2000, the third defendant's application for security for costs against the second plaintiff was dismissed. This application for security for costs against the first plaintiff was adjourned to 24 May 2000.
31. On 23 May 2000:
(a)the plaintiffs issued a summons seeking an order allowing two further plaintiff be joined to the proceeding. The affidavit of Daniella Amore sworn on 23 May 2000 in support of the application exhibited a Deed of Assignment dated 12 September 1998 purporting to assign all rights of the first plaintiff in the proceeding to two new plaintiffs - Daniella Amore and C. Amore & Sons Constructions Pty Ltd. At no stage between 12 September 1998 and 23 May 2000 did the third defendant receive any notice from the plaintiffs of the purported assignment;
(b)Anthony Zita filed a notice of change of practitioner on behalf of the plaintiffs and the third party; and
(c)The receiver and managers of the first plaintiff swore an affidavit informing the court that they did not wish to bring the proceeding in the name of or on behalf of the first plaintiff. However, they did not object to the first plaintiff, upon the direction of its directors continuing the proceeding.
32. On 24 May 2000 the third defendant's application for security for costs against the first defendant was adjourned to 29 June 2000. The application of C. Amore & Sons Constructions Pty Ltd and Daniella Amore to be joined as plaintiffs was adjourned to 29 June 2000 and they were ordered to pay the third defendants' costs of the day.
33. On 2 June 2000 Minter Ellison wrote to the plaintiffs solicitors noting that a draft amended statement of claim had not been served as ordered by Master Wheeler on 24 May 2000. A copy of Minter Ellison's letter dated 2 June 2000 is attached to this chronology and marked 'C6'.
34. On 6 June 2000 the plaintiffs served an amended statement of claim.
35. On 7 June 2000, the third defendant issued a summons seeking to have the first plaintiff's claim struck out on the basis that the purported Deed of Assignment was ineffective to vest the first plaintiff's rights in the proceeding to the two new plaintiffs - Daniella Amore and C. Amore & Sons Constructions Pty Ltd.
36. The hearing of the applications listed for 29 June 2000 was adjourned to 19 July 2000 as the Master was not able to hear the applications as the dated listed.
37. On 19 July 2000 the third defendant's summons dated 14 February 2000 (security for costs against the first plaintiff) and the third defendant's summons dated 7 June 2000 (striking out the plaintiff's claim) were dismissed. The court ordered that the application be dismissed on the basis that the question of whether the Deed of Assignment was effective to assign all of the rights of the first plaintiff to the two new plaintiffs was not a question properly determined by the Master. Instead, the Master was of the view that this was a substantive matter to be determined at trial. Daniella Amore and C. Amore & Sons Constructions Pty Ltd were ordered to pay the costs of the third defendant of the day.
38. The plaintiffs' summons dated 23 May 2000 was heard by the court on 24 July 2000. The court ordered:
(d)the entitling of all documents filed herein after 20 October 1999 are deemed amended by adding the phrase 'Receivers and Managers appointed' after the name Hub Properties Pty Ltd wherever appearing in a title;
(e)C Amore & Sons Constructions Pty Ltd and Daniella Amore are added as the third and fourth named plaintiffs in the proceedings;
(f)the plaintiffs have leave to amend their statement of claim by substituting for it a statement of claim to the effect of the proposed amended statement of claim marked 'A', initialled by the Master and placed on the Court file this day;
(g)the plaintiffs may comply with Rule 9.11(1) and amend their statement of claim by filing a copy of the writ in this proceeding amended and endorsed as required by that Rule incorporating the amended statement of claim within 14 days after this day;
(h)a copy of the writ so filed and the statement of claim as amended and this order as authenticated must be served on the defendants within 28 days after this day;
(i)the added plaintiffs pay any costs thrown away by reason of their addition as plaintiffs and by reason of the amendment to the statement of claim and the costs of this application.
39. On 30 August 2000 Minter Ellison wrote to the plaintiff's solicitors noting that the plaintiffs had not complied with the order made on 24 July 2000 and requesting that the amended statement of claim be served by 4:00 pm on the following day. A copy of Minter Ellison's letter dated 30 August 2000 is attached to this chronology and marked 'C7'.
40. By letter dated 13 September 2000, Minter Ellison wrote to Mr Anthony Zita, acting for the plaintiffs, requesting that the plaintiffs file and serve an amended writ and statement of claim in accordance with the orders of Master Wheeler made on 24 July 2000. A copy of Minter Ellison's letter dated 13 September 2000 is attached to this chronology and marked 'C8'.
41. By letter dated 9 October 2000, Minter Ellison again wrote to Mr Anthony Zita requesting that the plaintiffs file and serve an amended writ and statement of claim as required by the orders of Master Wheeler. A copy of Minter Ellison's letter dated 9 October 2000 is attached to this chronology and marked 'C9'.
42. On 9 October 2000 the third defendant filed its second amended defence.
43. On 24 November 2000 the third defendant's costs order to be paid by the plaintiffs and the third party under the following orders were taxed:
(j)order of Master Kings made on 17 February 1998;
(k)order of Master Wheeler made on 23 August 1999;
(l)order of Master Evans made on 29 March 2000;
(m)order of Master Wheeler made on 24 May 2000;
(n)order of Master Wheeler made on 19 July 2000;
(o)order of Master Wheeler made on 24 July 2000.
44. On 8 February 2001, the court ordered that each party serve on one another a proposal for a further timetable for interlocutory steps in the proceeding. The court also ordered that the parties attend a further directions hearing on 15 March 2001.
45. On 14 March 2001 the third defendant served the plaintiffs with a notice to produce the original Deed of Assignment.
46. By letter dated 14 March 2001, Minter Ellison again wrote to Mr Anthony Zita, noting that the plaintiffs had still not yet filed and served an amended writ and statement of claim in accordance with the orders of Master Wheeler. A copy of Minter Ellison's letter dated 14 March 2001 is attached to this chronology and marked 'C10'.
47. Minter Ellison received no response to its letter dated 14 March 2001 and accordingly Ms Jessica Lyons of Minter Ellison attended the directions hearing before Master Bruce on 15 March 2001. Master Bruce declined to make any further interlocutory orders in the proceeding on the basis that the plaintiffs and third party had not complied with the previous three orders of the court. The Master ordered the third defendant to bring an application for the plaintiffs and the third party's compliance with previous orders of the court by 29 March 2001.
48. On 30 March 2001, the third defendant issued a summons and affidavit in support seeking, amongst other things, judgment for the third defendant on the ground that the third and fourth plaintiffs had failed to serve an amended writ and statement of claim and/or on the ground of want of prosecution.
49. On 4 April 2001, Minter Ellison wrote to Aloe & Co Pty Ltd (new solicitors for the plaintiff) requesting that a notice of change of practitioner be filed and served immediately and noting that the summons dated 30 March 2001 was returnable before the Master on 9 April 2001. A copy of Minter Ellison's letter dated 4 April 2001 is attached to this chronology and marked 'C11'.
50. On 6 April 2001 Aloe & Co served a notice of change of practitioner acting on behalf of the plaintiffs and the third party.
51. On 9 April 2001, the court ordered that the hearing the third defendant's summons dated 30 March 2001 be adjourned to 1 May 2001 in light of the appointment of the new solicitors. The plaintiff and third party were ordered to pay the third defendant's costs.
52. On 30 April 2001 the court ordered by consent that:
(p)Any request for further and better particulars of statement of claim was to be served by 15 June 2001.
(q)Any further and better particulars of statement of claim was to be served by 4 July 2001.
(r)Any request for further and better particulars of defence and any counterclaim was to be served by 15 June 2001.
(s)Any further and better particulars of defence and counterclaim was to be served by 4 July 2001.
(t)The third and fourth plaintiffs were to provide an affidavit of documents by 11 June 2001.
(u)The first & second plaintiffs were to provide an affidavit of specific discovery by 11 June 2001 pursuant to Rule 29.08, in respect of documents evidencing:
(i)the advance of $100,000.00 as alleged in paragraph 20 of the Statement of Claim; and
(ii)the advance of $100,000.00 as alleged in paragraph 43 of the Statement of Claim.
(v)The plaintiffs were to produce the original Deed of Assignment dated 12 September 1998 referred to in the notice to produce dated 14 March 2001 or otherwise provide an affidavit explaining what has become of the original Deed of Assignment by 8 June 2001.
(w)The plaintiffs were to pay the third defendant's costs of the application brought by Summons dated 30 March 2001.
(x)Mediation was to be completed by 27 July 2001.
53. On 1 May 2001 the sum of $16,622.80 was deposited by Aloe & Co into the Minter Ellison trust account to satisfy the six cost orders made against the plaintiffs in the third defendant's favour and the costs order made against the third party.
54. On 7 June 2001, Daniella Amore on behalf of the first plaintiff swore an affidavit of specific discovery.
55. On 7 June 2001, Corrado Canzoneri, as director of the second plaintiff, swore an affidavit of documents.
56. On 26 June 2001, Minter Ellison wrote to the plaintiffs' solicitors, Aloe & Co, noting that the plaintiffs had failed to comply with paragraphs 5 and 7 of the orders made by Master Wheeler on 30 April 2002. Specifically, the third and fourth plaintiffs had failed to provide an affidavit of documents by 8 June 2001 and the plaintiffs had failed to produce the original Deed of Assignment dated 12 September 1998 or an affidavit explaining what had become of this document. A copy of Minter Ellison's letter dated 26 June 2001 is attached to this chronology and marked 'C12'.
57. On 29 June 2001, the plaintiffs filed and served further and better particulars of the statement of claim.
58. On 29 June 2001, Daniella Amore swore an affidavit of documents on behalf of the third and fourth plaintiffs.
59. On 29 June 2001, the fourth plaintiff filed an affidavit stating that she was unable to produce the original Deed of Assignment dated 12 September 1999, as it was being held by Isaac Brott who claimed he was entitled to a lien over the document allegedly in respect of unpaid fees.
60. By letter dated 12 July 2001, Minter Ellison wrote to the plaintiffs' solicitor Aloe & Co requesting copies of the documents and noting that it would be impossible to mediate without Minter Ellison having inspected the original Deed of Assignment. A copy of Minter Ellison's letter dated 12 July 2001 is attached to this chronology and marked 'C13'.
61. By letter dated 30 July 2001, Minter Ellison wrote to the plaintiffs' solicitor again seeking the requested documents and inquiring whether their attempts to locate the Deed of Assignment were successful. Minter Ellison reiterated that it would not be possible to mediate without the further discovery and the original Deed of Assignment. A copy of Minter Ellison's letter dated 30 July 2001 is attached to this chronology and marked 'C14'.
62. On 2 August 2001, Aloe & Co faxed Minter Ellison copies of the affidavits filed on 7 June 2001 and 29 June 2001.
63. On 6 August 2001, Michael Bakhaazi, the solicitor for the plaintiffs informed Howard Obst, a partner at Minter Ellison, that all of the plaintiffs' documents, including the original Deed of Assignment were held by Isaac Brott & Co who were claiming a lien over them and that efforts were being made to obtain the original documents. A copy of Minter Ellison's letter to Aloe & Co dated 31 August 2001 confirming the contents of the said conversation and inquiring about the progress made in relation to obtaining the original documents is attached to this chronology and marked 'C15'. Isaac Brott & Co had ceased to act for the plaintiffs on or about 23 May 2000, some 15 months before.
64. On 18 September 20001 a pre-trial directions hearing was listed before Master Kings. As the third defendant was the only party appearing, Master Kings adjourned the directions hearing to 16 October 2001.
65. By letter dated 20 September 2001, Minter Ellison wrote to the plaintiffs' solicitors seeking to know what progress, if any, they had made in obtaining the original documents held by Isaac Brott. A copy of Minter Ellison's letter dated 20 September 2001 is attached to this chronology and marked 'C16'.
66. By letter dated 25 September 2001, the plaintiffs' solicitors advised that they would not oppose Minter Ellison's application for non-party discovery by Mr Brott to obtain the original Deed of Assignment and other discoverable documents. A copy of Aloe & Co Pty Ltd's letter dated 25 September 2001 is attached to this chronology and marked 'C17'.
67. By letter dated 15 October 2001, Minter Ellison wrote to the plaintiffs' solicitors advising that they would oppose the fixing of the matter for trial and the making of any further direction in relation to mediation on the grounds that:
(y)the plaintiffs had not produced the documents discovered in Schedule 1 of Part 1 of their affidavit of documents of 7 June 2001 and 29 June 2001; and
(z)the third party had not discovered the computer file known as Namba.doc which was the subject of an Anton Pillar order by His Honour Mr Justice Beach on 17 March 1998 and on subsequent dates.
A copy of Minter Ellison's letter dated 15 October 2001 is attached to this chronology and marked 'C18'.
68. At the directions hearing on 16 October 2001, Minter Ellison argued that the matter could not be set down for trial without them having inspected the documents that had been discovered. On the basis that the plaintiffs' solicitors would arrange for Minter Ellison to have inspection of the documents at Isaac Brott's office, Minter Ellison consented to orders that the directions summons be adjourned until 4 December 2001.
69. By letter dated 17 October 2001, Minter Ellison wrote to the plaintiffs' solicitors advising, amongst other things, that Minter Ellison would continue to oppose the matter being set down for trial until the plaintiffs and third party had complied with their interlocutory obligations. A copy of Minter Ellison's letter dated 17 October 2001 is attached to this chronology and marked 'C19'.
70. By letter dated 26 October 2001, Minter Ellison again wrote to the plaintiffs' solicitors seeking their advice as to the steps they had taken to enable Minter Ellison to have access to the original documents the plaintiffs had discovered and to the computer disc entitled 'namba.doc'. A copy of Minter Ellison's letter dated 26 October 2001 is attached to this chronology and marked 'C20'.
71. By letter dated 22 November 2001, Minter Ellison wrote to the plaintiffs' solicitors accepting that inspection of the documents at Mr Brott's office could be arranged, but still seeking advice as to whether access could be gained to the computer disk. A copy of Minter Ellison's letter dated 22 November 2001 is attached to this chronology and marked 'C21'.
72. By letter dated 29 November 2001, Minter Ellison wrote to the plaintiffs' solicitors informing them that Mr Brott would not allow inspection of the documents until he was given an undertaking that they would hold the proceeds of the litigation in their trust account to be applied to Mr Brott's outstanding legal fees and until they attended his office to exactly identify which documents Minter Ellison would be allowed to inspect. A copy of Minter Ellison's letter dated 29 November 2001 is attached to this chronology and marked 'C22'.
73. On 2 December 2001 the plaintiffs' solicitor informed Minter Ellison that when a representative from the plaintiffs' solicitors attended at Mr Brott's office at the beginning of December, Mr Brott refused access to the documents. As a result the directions hearing listed for 4 December 2001 was adjourned by consent to 19 February 2002.
74. On 21 January 2002, Aloe & Co filed a notice that they were ceasing to act as practitioners for the plaintiffs and third party.
75. Annabel Evans of Minter Ellison attended at the directions hearing on 19 February 2002. Counsel appeared for the plaintiff as a courtesy to the court, there being no solicitors on the record for the plaintiffs. Counsel explained that the new firm of solicitors had only been instructed the day before the hearing and had not as yet obtained any papers. The directions hearing was adjourned by consent to 21 March 2002.
76. On 15 March 2002 Clark & Toop filed a notice that they were now acting on behalf of the plaintiffs.
77. On 21 March 2002, the court ordered that the parties serve on each other and file their proposals for a timetable for further interlocutory steps by 16 May 2002. The court adjourned the directions hearing until 23 May 2002.
78. By letter dated 16 May 2002, the plaintiffs' new solicitors, Clark & Toop, wrote to Minter Ellison setting out the plaintiffs' proposed timetable. A copy of Clark & Troop's letter dated 16 May 2002 is attached to this chronology and marked 'C23'.
79. On 17 May 2002, the third defendant filed its proposed timetable.
80. At the directions hearing on 23 May 2002, Master Bruce indicated that he would not be prepared to accept an adjournment of the directions hearing, nor was he prepared to order a timetable that the parties would not be in a position to meet. In fact, Master Bruce asked the third defendant why it had not issued an application to strike out the claim for failure to comply with previous orders. After some discussion Master Bruce ordered that the directions hearing be adjourned sine die and the plaintiffs were ordered to pay the third defendant's costs of the day.
81. On 3 July 2002, Clark & Toop filed a notice that they were ceasing to act as practitioners for the plaintiffs.
82. By letter dated 11 July 2002, Minter Ellison wrote to the incorporated plaintiffs at their registered address and to Daniella Amore at the address on her affidavit of documents asking them whether they intended to instruct another firm of solicitors and if so, which firm, as well as their intention concerning this litigation generally. This was followed up on 6 August 2002 and 20 August 2002. A copy of Minter Ellison's letters dated 11 July 2002, 6 August 2002 and 20 August 2002 are attached to this chronology and marked 'C24', 'C25' and 'C26' respectively.
83. On 20 August 2002 a cheque for $220 from United Finance Services Pty Ltd was received presumably in payment of the defendants costs ordered to be paid by the plaintiffs on 23 May 2002. United Finance Services Pty Ltd has the same registered office as the second and third plaintiffs and the fourth plaintiff is the sole director and secretary.
84. On 29 August 2002 Master Bruce noted that no steps had been taken in the proceeding for more than 12 months and ordered on the court's own motion that if no further order was made within 3 moths of the date of the order the proceeding would stand dismissed without adjudication on its merits and without prejudice to the right of any party to apply to reinstate if there are adequate grounds for doing so.
85. On 26 November 2002 the third defendant issued a summons seeking to dismiss the plaintiffs claim for wait of prosecution.
---
0
1
0