Hunter v Hanson - [2014] NSWCA 263

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Hunter v Hanson [2014] NSWCA 263
Hearing dates: 10 March 2014
Decision date: 13 August 2014
Before: McColl JA (at [1]), Macfarlan JA (at [79]), Emmett JA (at [82]
Decision:
Application for leave to appeal dismissed with costs
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords: PRACTICE AND PROCEDURE - extension of time for service - respondent filed statement of claim pleading causes of action in defamation and others shortly before limitation period for defamation causes of action expired - statement of claim not served on applicant within time limited by UCPR 6.2(4)(b)(ii) - respondent decided not to serve statement of claim until judgment in an appeal from a decision which if correct afforded a defence of absolute privilege to his defamation causes of action was delivered and also to avoid aggravating situation with applicant in respect of whose conduct he had sought an APVO - after APVO order granted and appeal judgment delivered respondent obtained leave to serve statement of claim out of time - exercise of judicial discretion to extend time - whether "good reasons" for delay in service - whether knowledge of sufficient facts to plead statement of claim determinative against extension of time - effect of expiration of limitation period on extension of time for service application
Legislation Cited: Civil Procedure Act 2005 (NSW)
Defamation Act 2005 (NSW)
District Court Act 1973 (NSW)
Evidence Act 1995 (NSW)
Fair Trading Act 1987 (NSW)
Limitation Act 1969 (NSW)
Medical Practice Act 1992 (NSW)
High Court Rules 1952 (Cth)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: Agricultural & Rural Finance Pty Limited v Kirk [2011] NSWCA 67; (2011) 82 ACSR 390
Battersby v Anglo-American Oil Co Limited [1945] KB 23
Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541
Brown v Coccaro (1993) 10 WAR 391
Carey v Australian Broadcasting Corporation [2012] NSWCA 176; (2012) 84 NSWLR 90
Cornelius v Global Medical Solutions Australia Pty Ltd [2014] NSWCA 65; (2014) 98 ACSR 301
FAI Insurances Ltd (in liq) v Mainprize [2006] NSWSC 554
Fox v Percy [2003] HCA 22; (2003) 214 CLR 118
Foxe v Brown [1984] HCA 69; (1984) 59 ALJR 186
Hanson and Others v Hunter and Another (Local Court (NSW), Pinch LCM, 16 February 2012, unrep)
House v The King [1936] HCA 40; (1936) 55 CLR 499
IMB Group Pty Ltd (in liq) v ACCC [2006] QCA 407; [2007] 1 Qd R 148
Kleinwort Benson Ltd v Barbrak Ltd [1987] AC 597
La Macchia v Minister for Primary Industries & Energy (1992) 110 ALR 201
Lucire v Parmegiani [2012] NSWCA 86
Lucire v Parmegiani [2010] NSWDC 115
Micallef v ICI Australia Operations Pty Ltd [2001] NSWCA 274
Muirhead v Uniting Church in Australia Property Trust (Q) [1999] QCA 513
Noonan v MacLennan [2010] QCA 150; [2010] 2 Qd R 537
Re Brashs Pty Ltd (1994) 15 ACSR 477
Rich v Long [2008] NSWSC 487
Rich v Packer [2007] NSWSC 1290
Simpson v Saskatchewan Government Insurance Office (1967) 65 DLR (2d) 324
Soper v Matsukawa [1982] VR 948
Tolcher v Gordon [2005] NSWCA 153
Van Leer Australia Pty Ltd v Palace Shipping KK [1981] HCA 11; (1981) 180 CLR 337
Victa Ltd v Johnson (1975) 10 SASR 496
Weston in Capacity as Special Purpose Liquidator of One.Tel Ltd (in liquidation) v Publishing and Broadcasting Ltd [2012] NSWCA 79; (2012) 88 ACSR 80
Category: Principal judgment
Parties: Scott Hunter - Applicant
Benjamin Alan Hanson - Respondent
Representation: Counsel:
K Smark SC with S Chrysanthou - Applicant
R Lancaster SC with K Traill - Respondent
Solicitors:
Kalantiz Lawyers - Applicant
Banki Haddock Fiora - Respondent

File Number(s):
Publication restriction: No
Decision under appeal

Date of Decision:

2013-05-10 00:00:00

Before:

Bozic DCJ

Judgment

McCOLL JA: The applicant, Scott Hunter, and the respondent, Benjamin Alan Hanson, are neighbours. Their relationship is not amicable. The antagonism stems from a long running dispute involving the use of a Crown Road running through the applicant's property. The respondent and his partner, Mr Wardell, use the road to access their property.

The respondent is a medical practitioner. The catalyst for the current proceedings are two letters dated 5 February 2010 and 28 March 2010 (the "letters"), which the applicant wrote and sent, inter alia, to the New South Wales Medical Board. The letters complained that the respondent had breached the Medical Practice Act 1992 (NSW) as then in force. To a large extent the factual basis for the complaints was derived from the respondent and his partner's conduct in respect of a hearing in the Local Land Board concerning the Crown Road.

On 4 February 2011 the respondent filed a statement of claim in the District Court naming the applicant as a defendant. The statement of claim alleged that the letters were defamatory of and concerning the respondent and sought unliquidated damages. The first letter was said to have conveyed 17 defamatory imputations and the second letter two. The imputations pleaded in respect of both letters, if conveyed, illustrate the serious allegations made by the letters. Thus imputation (a) is that the [respondent] "was so unprofessional that he breached standards of professional practice". Imputation (h) is that he "committed perjury". Imputation (i) is that he "committed a criminal offence". The statement of claim also sought unliquidated damages for injurious falsehood and misleading or deceptive conduct under the Fair Trading Act 1987 (NSW).

The statement of claim was filed one day before the limitation period for the defamation cause of action arising from the first letter expired on 5 February 2011: s 14B Limitation Act 1969 (NSW).

The respondent did not serve the statement of claim within the month limited by Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") 6.2(4)(b)(ii). Accordingly it became stale on 4 March 2011.

On 4 May 2012, fifteen months after the statement of claim was filed, the respondent sought and obtained leave from his Honour Judge Bozic SC to serve the statement of claim on the applicant out of time: UCPR 1.12. The applicant's solicitor accepted service of the statement of claim on his behalf on 21 June 2012.

The applicant sought an order setting aside service of the statement of claim (the "set aside motion"). The respondent sought an order extending time for service of the statement of claim up to and including 21 June 2012 (the "extension of time motion").

Judge Bozic SC heard both applications. He dismissed the set aside motion and acceded to the extension of time motion: Hanson v Hunter (District Court (NSW), Bozic DCJ, 10 May 2013, unrep).

This is the concurrent hearing of the applicant's application for leave to appeal from his Honour's orders and, if leave be granted, the hearing of his appeal against the primary judge's decision dismissing his application to set aside service. The applicant abandoned his application for leave to appeal the order made on the extension of time motion in the course of argument.

To avoid confusion I shall refer to the parties by reference to their roles in this Court. Thus I shall refer to the defendant below as the "applicant" and the plaintiff below as the "respondent", including when describing the District Court proceedings.

For the reasons which follow, I am of the view that the leave to appeal should be refused with costs.

Background

The history of the matter was set out in two affidavits sworn by Mr Bruce Burke, the respondent's solicitor. The transcripts of various directions hearings in the District Court prior to the May 2012 extension order were also in evidence. The applicant's solicitor put on two affidavits, neither of which was referred to by the applicant in submissions in this Court. It does not appear that either solicitor was cross-examined.

In April 2010 the respondent made an application for an Apprehended Personal Violence Order ("APVO") against the applicant and his wife. The application was heard in the Local Court of New South Wales on various dates between 20 May 2011 and 15 November 2011. The conduct said to warrant the granting of the orders appears largely to have arisen from conflict between the applicant and his wife and the respondent and his partner concerning use of the Crown Road. Final orders granting the APVO application were made on 16 February 2012 (the "APVO proceedings").

The statement of claim was listed for directions before the primary judge on 25 February 2011. Mr Burke informed his Honour that it had not been served and "there are some difficulties". He asked that the matter be adjourned for 2 months.

On 31 March 2011 process servers attempted to serve the statement of claim on the applicant at a farm he owned. He was not at the property. There was no further attempt to serve the statement of claim until May 2012.

Around 1 April 2011 the respondent decided not to serve the statement of claim until the Court of Appeal delivered its decision in Lucire v Parmegiani [2010] NSWDC 115 ("Lucire"). That case was an appeal from a decision of Gibson DCJ in defamation proceedings in which the matter complained of was also a letter written to the Medical Board. Her Honour held on 28 May 2010 that the letter was protected by absolute privilege pursuant to s 27(2)(d), Sch 1, cl 15(1)(a) of the Defamation Act 2005 (NSW) and dismissed the plaintiff's claim for defamation: Lucire. Argument in the Court of Appeal proceeded on 22 August and 16 November 2011, when the Court reserved its decision.

Mr Burke said that when the respondent instructed him to refrain from serving the statement of claim pending the decision in Lucire, he also told him that he was "keen to avoid making the situation between myself and Mr Hunter worse". The respondent also said, "if the Court of Appeal decision does not go my way, I may not proceed with the case".

Subsequent to the first directions hearing, there was a series of appearances in the District Court in which the respondent's legal representatives (either Mr Burke or Ms K Traill of counsel) sought to stand the matter over, principally on the basis that the respondent was awaiting the decision in Lucire. Another explanation for the delay in service was so as not to further antagonise the applicant, but rather to wait until the "AVO proceedings so it won't make matters worse": primary judgment (at [18]).

The Court of Appeal delivered judgment in Lucire v Parmegiani [2012] NSWCA 86 on 20 April 2012. The Court held (per Nicholas J at [51], Bathurst CJ, Allsop P, Beazley JA and McCallum J agreeing) that a letter of complaint to the New South Wales Medical Board was not published on an occasion of statutory absolute privilege pursuant to s 27(2)(d) of the Defamation Act, nor was it protected by absolute privilege at common law.

On 4 May 2012 Ms Traill of counsel appeared in the Defamation List for the respondent. She sought, and was granted, leave by the primary judge to serve the statement of claim out of time: primary judgment at [27]. Thereafter three unsuccessful attempts at service were made on 19 May 2012, 21 May 2012 and 24 May 2012. On 21 June 2012 the solicitor who appeared for the applicant in the APVO proceedings was instructed to accept service: primary judgment (at [30]).

The set aside motion was filed on 26 July 2012. It sought, inter alia, an order pursuant to UCPR 12.11(1)(e) discharging the order made on 4 May 2012 extending the time for service of the statement of claim.

Legislative framework

UCPR 1.12 provides:

"1.12 Extension and abridgment of time

(cf SCR Part 2, rule 3; DCR Part 3, rule 2; LCR Part 4, rule 2)

(1) Subject to these rules, the court may, by order, extend or abridge any time fixed by these rules or by any judgment or order of the court.

(2) The court may extend time under this rule, either before or after the time expires, and may do so after the time expires even if an application for extension is made after the time expires."

UCPR 12.11 relevantly provides:

"(1) In any proceedings, the court may make any of the following orders on the application of a defendant:

...

(b) an order setting aside the service of the originating process on the defendant,

...

(e) an order discharging any order extending the validity for service of the originating process."

Although the primary judge (at [7]) said that he would deal with the applicant's application as an application under UCPR 12.11(1)(b), nonetheless when referring to the legal principles he set out UCPR 12.11(1)(e): primary judgment (at [54]). Nothing turns on this. The principles are the same: Agricultural & Rural Finance Pty Limited v Kirk [2011] NSWCA 67; (2011) 82 ACSR 390 ("Kirk") (at [58]) per Tobias JA (Macfarlan JA and Sackville AJA agreeing); Weston in Capacity as Special Purpose Liquidator of One.Tel Ltd (in liquidation) v Publishing and Broadcasting Ltd [2012] NSWCA 79; (2012) 88 ACSR 80 ("Weston") (at [20](1)) per Sackville AJA ((with whom Campbell and Young JJA agreed).

Primary Judgment

Exercise of the UCPR 12.11(e) discretion required the primary judge to have regard to "the attempts that have been made at service, the length of the delay, the reasons for the delay, whether the delay was deliberate, whether notice was given to the defendant, the conduct of the parties generally and the hardship or prejudice caused to the plaintiff by [discharging the orders] or to the defendant [by refusing to discharge the order]": Weston (at [20](2)).

In dealing with the reasons for the delay, his Honour set out evidence Mr Burke gave concerning the APVO proceedings. Mr Burke did not act for the respondent in those proceedings. He recounted their course on information and belief sourced from the respondent. That evidence was, accordingly, admissible: s 75, Evidence Act 1995 (NSW).

According to his Honour's summary, the respondent had been seeking an APVO against the applicant and his wife since 30 April 2010. Although his Honour did not refer to it, Mr Burke's affidavit also noted that on 30 April 2010 interim APVO orders had been granted against the applicant in favour of the respondent. It appears that at some stage in 2010 the applicant and his wife were placed on bail "in terms of the Standard orders of an APVO": Hanson and Others v Hunter and Another (Local Court (NSW), Pinch LCM, 16 February 2012, unrep). That bail appears to have continued until the APVO orders were made.

The APVO hearings took place on 20 May, 1, 2, 8, 9 August, 27 October and 15 November 2011. They were decided in the respondent's favour on 16 February 2012. The primary judge recounted (at [40](i)) some of the Magistrate's findings. Her Honour found that on 21 June 2009 the applicant had said to the respondent in a "loud aggressive tone":

"If I was a bad person I could have your house burned down".

The Magistrate accepted that as a result of their fears arising from that conversation, the respondent and his partner installed fire resistant screen doors and shutters at their premises. The Magistrate also found that the applicant or his wife or someone acting on their behalf had engaged in conduct to intimidate and harass the respondent and his partner, including, on one occasion, driving a vehicle at the respondent's partner. On another occasion, the applicant stared at the respondent, pointed his hand at him as though it was a pistol and mouthed the word "bang": primary judgment (at [40](iii) - (v)).

The Magistrate described the substance of what appears to be the first of the letters the respondent has sued upon as having "very little to do with Dr Hanson's professional competence and [as] more of a personal attack on him in retaliation for the stance he has taken at the Land Board hearing in support of [his neighbour] ... it reveals the depth of animosity of Mr Hunter to Dr Hanson and Mr Wardell on and from this time": primary judgment (at [40](ii)). Her Honour found that "the animosity felt by the defendant and his wife towards the plaintiff and Mr Wardell was 'distinctly personal, as evidenced in the complaints to the Medical Board and the creation of a website to acquire information about Mr Wardell as well as [the respondent]": primary judgment (at [40](vii)).

The Magistrate concluded that the applicant's harassment and stalking conduct had continued over three years and that the respondent and his partner feared that that conduct would continue once restrictions on the applicant's bail conditions were lifted. The Magistrate was also satisfied that the respondent and his partner feared for their personal safety and the safety of their vehicles and that their fears as to the future conduct of the applicant and his wife were reasonable save as to a concern as to the latter's use of firearms: primary judgment (at [41]). Her Honour granted the standard APVO order with additional orders. The orders were to remain in force for two years. King DCJ dismissed the applicant's appeal from the Magistrate's decision in August 2012: primary judgment (at [38]).

The primary judge set out (at [55]) the applicable legal principles governing the exercise of the power conferred by UCPR, r 12.11(1)(e) as summarised by Sackville AJA in Weston (at [20]) as follows:

"(1) The principles relevant to an application to extend time for service under r 1.12 also apply to a motion pursuant to r 12.11(1)(e) to discharge orders for extension: Kirk [Agricultural & Rural Finance Pty Limited v Kirk [2011] NSWCA 67; 82 ACSR 390], at 402 [58], per Tobias JA (with whom Macfarlan JA and Sackville AJA agreed).

(2) In exercising the discretion conferred by r 12.11(1)(e), the court should consider:

'the attempts that have been made at service, the length of the delay, the reasons for the delay, whether the delay was deliberate, whether notice was given to the defendant, the conduct of the parties generally and the hardship or prejudice caused to the plaintiff by [discharging the orders] or to the defendant [by refusing to discharge the order].'

Buzzle [Arthur Anderson Corporate Finance Pty Ltd v Buzzle Operations Pty Ltd (in liq) 2009 NSWCA 104], at [43], per Ipp JA (with whom Tobias and McColl JJA agreed) cited with approval in Kirk, at [94].

(3) The discretion is to be exercised in the context of, and by reference to, the statute by which it is conferred: Buzzle, at [28]. Consequently, in New South Wales, ss 56-59 of the Civil Procedure Act 2005 ('CP Act') require a judge exercising the discretion to have regard to whether the relevant party has:

(a) diligently pursued the object of disposing of the proceedings in a timely way;

(b) used, or could reasonably have used, available opportunities under the rules or otherwise, to avoid delay; and

(c) reasonably implemented the practice and procedure of the court with the object of eliminating any lapse of time between the commencement of the proceedings and their final determination: Buzzle, at [36].

(4) The court must take into account the policy considerations underlying the relevant limitations statute. Thus, defendants or potential defendants should be made aware of claims against them within a reasonable time and liquidators who do not commence proceedings until just before expiry of the limitation period should be especially diligent in pursuing prompt service: Buzzle, at [37] - [39]; cited with approval in Kirk, at 410 [98] - [99].

(5) It is for the court and not one of the litigants to determine whether there should effectively be a stay of proceedings. Accordingly, it is generally:

'Inappropriate to allow an extension of time for the service of a ... statement of claim where a significant cause of the delay has been the willingness of the plaintiff to do nothing about service while awaiting a decision from a litigation funder as to whether or not to provide the necessary funds. Were that to be regarded as a good reason to extend time, the Court would be allowing plaintiffs to arrogate to non-parties the right to decide the period by which the time for service of a writ should be extended. That would be fundamentally in conflict with the Court's duty to exercise, alone, the discretion conferred upon it.'

Buzzle, at [82] cited with approval in Kirk, at 411 [101].

(6) Ordinarily, it is not a good reason for delay that a plaintiff wishes to hold up proceedings while some other case is tried: Buzzle, at [90]. However, this is not an inflexible rule: Kirk, at 411 [102].

(7) If a defendant knows that claims have been made against him or her and understands the nature of the claims that have been made, that may mitigate the prejudice the defendant might otherwise suffer by reason of a delay in service: Kirk, at 415 [123].

...

[21] In Buzzle, Ipp JA referred (at [32]) with approval to IMB Group Pty Ltd (in liq) v Australian Competition and Consumer Commission [2006] QCA 407; [2007] 1 Qd R 148 ('IMB'). In IMB, Keane JA (with whom McMurdo P and Cullinane J agreed), observed (at 160 [54]) that no case had held that the Queensland rules or their equivalents authorise renewal of a claim in favour of a party who:

'chooses not to serve a claim where the facts of the case sufficient to enable the claim to be pleaded are known to the plaintiff.'

This observation was made having regard to the requirement in the Queensland rules that a party impliedly undertakes to the Court and to the other parties to proceed in an expeditious way. In Buzzle, Ipp JA pointed out that (at [35]) the provisions of the CP Act are 'akin to (and, in some aspects, go further than) the Queensland ... rules'. In Kirk, Tobias JA distinguished IMB on the facts, but cast no doubt on the applicability of the reasoning in that case in New South Wales."

The primary judge referred (at [59]) to the fact that prior to the grant of leave to serve the statement of claim out of time on 4 May 2012, there was one attempt to serve the statement of claim on 31 March 2011. His Honour found (at [61]) that the delay was lengthy having regard to the fact that the limitation period for the defamation cause of action in respect of the first letter expired on 5 February 2011, but the statement of claim was not served for a further 17 months. His Honour found (at [63]) that the delay "was brought about by a combination of the plaintiff not wanting to unnecessarily aggravate existing hostilities by serving a statement of claim in circumstances in which the Court of Appeal might determine that the plaintiff had no cause of action". He concluded (at [65]) that that was a "deliberate decision taken by the plaintiff".

The primary judge next found (at [70]) that the applicant, whilst not expressly notified of a possible defamation claim, received a letter from the respondent's solicitors dated 14 December 2010 complaining the letters were false, malicious and indefensible and foreshadowing legal proceedings unless the applicant apologised and withdrew the complaints.

As to the conduct of the parties generally, his Honour rejected (at [73]) the applicant's submission that the respondent's representatives had not been candid with the court at the directions hearings. He also found (at [76]) that "[a]lthough general prejudice may be presumed from a lapse of time", there was no evidence of any particular, or general, disadvantage to the applicant arising from the delay.

The primary judge concluded (at [84]) that he did not propose to discharge the order made on 4 May 2012 extending the time for service of the statement of claim. He made the following findings (at [85]):

"(i) For a considerable period of time dating back until at least the beginning of 2010 the defendant exhibited a significant degree of animosity towards the plaintiff.

(ii) In early 2010 the plaintiff instituted AVO proceedings against the defendant and his wife. These proceedings were heard on various dates in May, August, October and November 2011.

(iii) There were good reasons for the fears held by the plaintiff because, as the magistrate found, the defendant had engaged in acts of intimidation and stalking of the plaintiff.

(iv) As at the date of the filing of the statement of claim there was a decision of the District Court the effect of which was that the matter complained of by the plaintiff was the subject of absolute privilege. If that remained the law it was unlikely that the plaintiff would proceed with his claim.

(v) The District Court decision was the subject of an appeal.

(vi) The plaintiff instructed his solicitors to await the outcome of the decision of the Court of Appeal first, in order to avoid serving a statement of claim which pleaded a hopeless case and, secondly, to avoid if at all possible further antagonising a man who had stalked and intimidated the plaintiff in the past.

(vii) The matter was listed from time to time in the Defamation List and the court informed of what was happening."

After setting out passages of paragraphs [125], [126] and [130] from Kirk, the primary judge concluded:

"[87] (i) The plaintiff was faced with a decision which, as it stood, meant that 'there would have been no point in serving' the defendant.

(ii) The reality was that, once served it was highly likely that the defendant would have sought legal representation and advice with the inevitable costs consequence that that would have involved for both parties.

(iii) This case cannot be fairly described as one where the [respondent] unilaterally and without judicial endorsement or rational cause, arrogated to itself a stay of the proceedings against the [applicant]. In the circumstances the [respondent's] failure to serve the statement of claim while the issue of whether the [applicant's] letters to the Medical Board were written on occasions of absolute privilege cannot be regarded as so unreasonable and lacking a rational explanation or basis as to weigh heavily in the balancing exercise which the Court is required to undertake." (Emphasis in original)

His Honour also took into account (at [88]) that there was no actual prejudice to the applicant.

The primary judge had noted (at [81]) the parties' respective submissions as to whether the failure to serve the statement of claim within time and the respondent's subsequent conduct in relation to service, accorded with the overriding purpose in s 56 of the Civil Procedure Act 2005 (NSW). In this respect his Honour concluded (at [89]) that while such matters favoured the applicant, they were not determinative because he was "satisfied that the combination of the two reasons given by the plaintiff for not serving the statement of claim constitute 'good reasons.' "

The primary judge also concluded (at [90] - [91]) that since the respondent took reasonable steps to have the statement of claim served within time after the leave to serve the statement of claim out of time was granted on 4 May 2012, he would extend the time for service of the statement of claim up to and including 21 June 2012, the date on which service was effected.

Applicant's Submissions

The applicant submitted that the primary judge's exercise of his discretion to dismiss the set aside application miscarried in a House v The King [1936] HCA 40; (1936) 55 CLR 499 sense because his Honour:

"(a) Erred in principle, by granting a substantial extension of time to a party who had chosen not to serve despite being able to plead his claim;

(b) Erred by failing to take into account the lack of explanation for permitting the statement of claim to go stale;

(c) Took into account an irrelevant consideration, namely the respondent's desire to await this Court's decision in Lucire v Parmegiani;

(d) Erred by finding or holding that the respondent had good reason not to serve the statement of claim because of the AVO proceedings between the parties;

(e) Failed to take into account the lack of a timely application for an extension of time;

(f) Failed to take into account the failure of the respondent to notify the applicant of the extension of time within a short period after it was given;

(g) Failed to take into account the respective prejudice to each party."

The applicant's primary submission is that, as a matter of law, knowledge of sufficient facts to plead is either a determinative or at least highly material factor telling against extension of time. He relied, in particular, on the observations of Keane JA (as his Honour then was) in IMB Group Pty Ltd (in liq) v ACCC [2006] QCA 407; [2007] 1 Qd R 148 ("IMB"). He submitted that that case was authority for the proposition that "no case has held that the relevant rules authorise renewal in favour of a party who chooses not to serve a claim where sufficient facts are known to enable the claim to be pleaded." He submitted that the respondent's statement of claim showed that he had sufficient knowledge to enable him to fully plead his causes of action.

Secondly, the applicant argued that the two reasons the primary judge found explained the respondent's failure to serve the statement of claim (not wishing to aggravate existing hostilities and wishing to await judgment in Lucire) only arose after the statement of claim had already become stale on 4 March 2011. Accordingly, he submitted, there was no explanation as to why the statement of claim was allowed to become stale.

Thirdly, the applicant submitted that his Honour erred as a matter of principle in finding that waiting for the Court of Appeal's decision in Lucire was a "good reason" for the respondent to not serve the statement of claim. He argued, in reliance on Battersby v Anglo-American Oil Co Limited [1945] KB 23 ("Battersby") (at 32), that "ordinarily it is not a good reason that the plaintiff desires to hold up the proceedings while some other case is tried". He sought to distinguish Kirk, where the Court of Appeal granted an extension in circumstances where a plaintiff had awaited the result of a related test case before serving the defendant. That case differed, he argued, because the application for an extension of time was made and granted and service was effected within the limitation period, the defendants were on notice of the proposed proceedings before the originating process became stale and, too, the defendants knew of the test case the plaintiffs waited on before effecting service.

In contrast, in this case, the limitation period had expired for both defamation causes of action when the extension of time to serve was granted and the applicant was unaware of either the mooted defamation proceedings or the decision to defer service pending the outcome of the Lucire appeal.

Fourthly, the applicant argued, Gibson DCJ's decision in Lucire was not binding on other District Court judges and, in any event, only had a bearing on one of the three causes of action pleaded in the statement of claim. Accordingly the primary judge should not have accepted that waiting for the appeal decision in Lucire was a good reason to defer service.

Fifthly, the applicant submitted that the respondent's claim that he did not serve the statement of claim to avoid further antagonizing the applicant was not credible. His concern was not such that it would have prevented him pursuing litigation against the applicant if a defence of absolute privilege was not available to the applicant, that is to say if the Court of Appeal upheld the Lucire appeal.

The applicant pointed out that, according to Mr Burke's evidence, on 30 April 2010 interim APVO orders had been granted against the applicant on the respondent's application. The respondent had attempted to serve the applicant on 31 March 2011 despite the APVO proceedings being current. The applicant submitted, in that light, the primary judge could not properly have given decisive weight to the desire "not to inflame things". Furthermore, the final APVO orders were made on 16 February 2012; but the application for an extension of time for service was only made on 4 May 2012.

Sixthly, the applicant submitted that the primary judge did not take into account the continuing failure of the respondent to make a timely application for an extension of time for service. He relied on the fact that no extension was sought despite the matter having come before the court on a number of occasions after the pleading became stale. This was even though in July 2011 the List Judge drew to Counsel's attention the issue of the statement of claim becoming stale, while in March 2012, the List Judge queried whether an adjournment would take the respondent "out of your serving time".

Seventhly, the applicant contended that the respondent's failure to notify him of the ex parte extension of time within 7 days of the order being made and his right to apply to have the extension order set aside was a material basis for granting the set aside application in accordance with Rich v Long [2008] NSWSC 487 (at [23], [31]) per Young CJ in Eq.

Finally, the applicant submitted that his Honour erred by failing to give effect to the presumptive prejudice he would suffer by reason of delay in service. He contended that by not serving the statement of claim as required, in circumstances where the parties were engaged in other civil litigation at the time it should have been served, he was deprived of the opportunity to reflect on how to best apportion his legal resources. He argued that in contrast, even if his appeal were successful, the respondent would still have had his other causes of action, which were (and are) still within time.

Respondent's Submissions

The respondent's principal submission is that the primary judge's decision involved an unexceptionable exercise of discretion on a matter of practice and procedure which this court should be cautious to review. He contended that the applicant sought impermissibly to confine an unfettered discretion by encrusting an inflexible or determinative principle upon it. He argued that there is no determinative principle against granting an extension of time to serve a statement of claim in circumstances where the plaintiff knows all the facts necessary to plead a cause of action. He pointed out that, contrary to the statement in IMB upon which the applicant relied (see [42] above), there were a number of cases in which renewal had been granted after a period of deliberate non-service of a claim that was able to be, and had been, fully formulated: the first four extensions in Weston, FAI Insurances Ltd (in liq) v Mainprize [2006] NSWSC 554 (Simpson J), Kirk and Rich v Packer [2007] NSWSC 1290 (Barrett J).

If that submission was accepted then, the respondent contended, the applicant had not demonstrated any House v King error. Rather, it was open to the primary judge to ascribe such weight as he considered relevant to the factors he had correctly extracted from Weston.

Secondly, the respondent emphasised that once his statement of claim had been filed in the District Court, there was no subsisting limitation issue. Thus, he argued, the events that followed after the statement of claim was filed concerned compliance with the rules as to service.

Thirdly, the respondent contended that the primary judge had not failed to consider the lack of explanation for the claim going stale. Rather, he argued that that was explained by the continuation of the APVO proceedings and awaiting the decision in the Lucire appeal.

Consideration

The primary judge's decision was an interlocutory one concerning the application of his discretion on a matter of practice and procedure. Such a decision required leave to appeal: s 127(2), District Court Act 1973 (NSW). It can only be challenged on the grounds identified in House v The King (at 504 - 5); see also Micallef v ICI Australia Operations Pty Ltd [2001] NSWCA 274 (at [45]) per Heydon JA (Sheller JA and Studdert AJA agreeing). Furthermore, because "courts are reluctant to intervene in relation to decisions made prior to the termination of proceedings ... an applicant for leave to appeal in such a matter will normally be required to establish at least a clear case of material error in the decision at first instance in order to obtain leave to appeal": Cornelius v Global Medical Solutions Australia Pty Ltd [2014] NSWCA 65; (2014) 98 ACSR 301 (at [21]) per Macfarlan JA (Ward JA and Tobias AJA agreeing).

UCPR 12.11 confers a discretion which is to be exercised judicially and is not fettered by inflexible prescriptions. However, the discretion is not at large. It is to be exercised in the context of and by reference to the statute by which it is conferred (and any other statute that is relevant to the legislative context) and in accordance with principles developed by judicial decisions: Buzzle (at [28]). The object of the discretion "'is to leave scope for the judicial or other officer who is investigating the facts and considering the general purpose of the enactment to give effect to his view of the justice of the case' [and in that respect] ... the judge is entitled to look at every relevant fact and circumstance that does not travel beyond the scope and purpose of the enactment authorising an extension of the limitation period": Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541 (at 554) per McHugh J; (at 564 - 565) per Kirby J.

In Victa Ltd v Johnson (1975) 10 SASR 496 ("Victa Ltd") (at 502), Bray CJ discerned in the area of procedural law concerned with applications to renew a writ, "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." His Honour's reasoning as to the approach to such an application, in particular that in exercising its discretion to renew, the court has regard "to the general justice of the case, paying regard to all the circumstances, including not only any limitation statute but also the relative hardships which grant or refusal of renewal would impose upon the parties" was approved by Stephen J in Van Leer Australia Pty Ltd v Palace Shipping KK [1981] HCA 11; (1981) 180 CLR 337 ("Van Leer") (at 342ff) per Stephen J; see also Kirk at [222](f) and (g); Brown v Coccaro (1993) 10 WAR 391 (at 395) Pidgeon J; (at 400) per Ipp J; (at 401) per Wallwork J agreeing with Pidgeon and Ipp JJ; Muirhead v Uniting Church in Australia Property Trust (Q) [1999] QCA 513 (at [4]) per Pincus JA (Davies JA agreeing).

Many of the principles concerning renewal of a stale writ were developed at a time when the rule permitting such an application were to the effect that "the court might order that a writ be renewed if satisfied that reasonable efforts had been made to serve the defendant," or for "other good reason". An example is O 8, r 1(1) of the High Court Rules 1952 (Cth) which Stephen J considered in Van Leer. However, although that terminology does not apply to the exercise under the general provision in UCPR 1.12 to extend "any time fixed by these rules", it is accepted that the court should determine the question of extending the time for service of the originating process by reference, at least, to whether the plaintiff had "good reason" for not serving the originating process within time: see Buzzle (at [82], [89], [90]), Kirk (at [101] - [102]; Weston (at [20](5)); see also Kleinwort Benson Ltd v Barbrak Ltd [1987] AC 597 (at 622).

Whether there is or is not good reason depends on all the circumstances of the particular case: Kleinwort Benson Ltd (at 622 - 623); Buzzle (at [94]). Thus "the selection of the factors constituting or relevant to 'good reason' is a matter of discretion, as is also the relative significance to be given to the selected matters": Soper v Matsukawa [1982] VR 948 (at 954) per Lush J (Gray J agreeing).

The applicant seeks to raise two points of principle he argues militated in favour of his Honour granting the set aside order.

The first relies upon Keane JA's statement in IMB (see [42] above). This argument was not advanced before the primary judge at least so far as is apparent from the written submissions before his Honour. The respondent did not, properly, object to it being raised on the application for leave to appeal.

I accept the force of Keane JA's statement which turned on the duty imposed upon a party (and I would add their legal representatives) to proceed in an expeditious way (see s 56(3) and (4), Civil Procedure Act 2005 (NSW)): see Weston (at [21]). However his Honour's statement cannot be treated as an immutable proposition which militates in favour of a set side order whenever the circumstances there stated arise. As the respondent submits, that proposition is gainsaid by a number of decisions (see [52] above). Each case must depend upon the facts as Tobias JA concluded in Kirk (at [103] - [105]) in distinguishing IMB.

In my view the matters which his Honour found constituted good reasons for the delay in service were sufficient to justify the primary judge's conclusion that the expeditious procedure principles were outweighed by the circumstances of this case.

In Battersby the Court of Appeal held that it would not exercise its discretion in favour of the renewal of a writ after the period allowed for service had expired, nor allow an amendment of pleadings to be made, if the effect of doing so would be to deprive a defendant of the benefit of the expiration of a limitation period.

As I have said, insofar as the defamation causes of action are concerned, the statement of claim was filed one day prior to the expiry of the limitation period for the cause of action in respect of the first letter. The limitation period for the injurious falsehood and the Fair Trading Act claim is six years (s 14(b) Limitation Act and s 68(2) Fair Trading Act, as it stood at February and March 2010, the relevant dates). Therefore these causes of action are still within time.

The Battersby view depended on the proposition that a stale writ is a nullity: Battersby (at 29) per Lord Goddard. In Van Leer (at 340 - 341) Stephen J concluded that subsequent English authorities had rejected that view of the efficacy of a stale writ. His Honour approved Bray CJ's statement in Victa Ltd (at 504) that "[t]he efficacy of the writ does not expire absolutely at the end of the twelve months, it only expires if and in so far as the court sees fit not to renew it". Accordingly, it followed in his Honour's view, that "renewal out of time cannot properly be described as depriving a defendant of a defence the essence of which is failure to issue within time." Nevertheless, his Honour recognised (at 341) that the expiry of a limitation period was a relevant consideration.

After an extensive review of English and Commonwealth authorities, Stephen J concluded (at 346) that he should adopt the approach favoured by the South Australian Supreme Court in Victa Ltd and Culliton CJS in Simpson v Saskatchewan Government Insurance Office (1967) 65 DLR (2d) 324 that "once the writ is issued within the limitation period and so long as the court has the discretion to renew the writ the limitation period is of no relevance": see Foxe v Brown [1984] HCA 69; (1984) 59 ALJR 186 (at 189) per Mason J; see also Buzzle (at [28]). Rather, it is a matter to be considered in the exercise of determining whether, in all the circumstances, the applicant for renewal had "good reason" for seeking that relief: Victa Ltd (at 503 - 504) approved Van Leer (at 344).

I accept the applicant's submission that the primary judge did not consider the apparent lack of explanation for the failure to serve the statement of claim within the month limited by UCPR 6.2(4)(b)(ii). However even if there was no adequate explanation for that omission, that failure merely focuses the Court's attention on whether there was otherwise good reason for the failure to serve the statement of claim: Victa Ltd (at 504).

I would infer that the two reasons the primary judge found constituted good reasons for the delay in service (awaiting the appeal decision in Lucire and concern about the effect of service on the conduct underlying the APVO proceedings) were also operative in the failure to serve the statement of claim within a month. I accept as the applicant submits, that the one attempt at service on 31 March 2011 somewhat belies both these reasons. However Mr Burke, who, as I have said, was not cross-examined, advanced both reasons as operative in the decision not to serve the statement of claim. There is no reason to doubt that evidence. Both situations originated well before the statement of claim was filed and persisted into 2012. The application for an extension of time to serve the statement of claim was made at the next directions hearing after the Lucire judgment was delivered at a time when the applicant was subject to the APVO granted in February 2012. Thus it was made when both situations had been resolved.

I do not accept that the respondent's decision to await this Court's judgment in Lucire was an irrelevant consideration. Although it was not a test case arising from the same factual controversy as in Kirk, it did concern a legal principle which would have rendered the statement of claim futile insofar as it sought to recover damages for defamation. It was open to the primary judge to conclude (at [85](iv), [87](i)) that the respondent would not have proceeded with the claim if Gibson DCJ'S decision had been upheld. Further, it could be expected that other District Court judges would have followed her Honour's decision unless convinced it was plainly wrong: La Macchia v Minister for Primary Industries & Energy (1992) 110 ALR 201 (at 204) per Burchett J; Re Brashs Pty Ltd (1994) 15 ACSR 477 (at 483) per Hayne J.

The respondent did have an arguably alternative course to pursue pending delivery of the appeal decision in Lucire. He could have refrained from filing, then if Lucire went his way, made an application for an extension of the limitation period for the two defamation causes of action pursuant to s 56A of the Limitation Act. That provision requires a Court "if satisfied that it was not reasonable in the circumstances for the plaintiff to have commenced an action in relation to the matter complained of within one year from the date of publication" to extend that limitation period to a period of up to three years running from the date of publication. However, s 56A poses a high test: see Carey v Australian Broadcasting Corporation [2012] NSWCA 176; (2012) 84 NSWLR 90 (at [55] - [57]) per Beazley JA; McColl JA and Sackville AJA agreeing; see also Noonan v MacLennan [2010] QCA 150; [2010] 2 Qd R 537 (at [15] - [20]) per Keane JA; (at [30] per Holmes JA; (at [50] - [51], [58], [65]) per Chesterman JA. The respondent was between Scylla and Charybdis. In my view it was open to him to take the course he did.

The primary judge was also entitled to accept (at [85](vi)) that underlying the decision to await the outcome in Lucire was the respondent's apprehension about "further antagonising" the applicant. That the respondent's fears were well-founded can be seen in the serious findings the Magistrate (see [28] - [31] above) made concerning the applicant and his wife's past, and potentially future, intimidatory and harassing conduct.

This was not a case of merely awaiting a favourable outcome in another case but, too, making that decision in the very unusual circumstances of the applicant's antagonistic behaviour.

The applicant's reliance on Rich v Long does not advance matters in my view. The respondent did not apparently notify the applicant of the extension order within seven days or advise him that he had up until the expiration of 28 days after service of the process to set aside the order (UCPR 12.11(2); UCPR 6.10(a)(i)), however he did not suffer any prejudice by reason of that failure. Young CJ in Eq did not suggest that failure to give such notice would, as the applicant's submissions appear to contend, be a determinative factor in acceding to a set aside application.

Finally I would observe that the applicant has not made good his challenge to the primary judge's factual conclusions as to the respondent's reasons for deferring serving the statement of claim. He has not pointed to any incontrovertible facts or uncontested testimony demonstrating that his Honour's findings were erroneous, nor demonstrated that his Honour's findings were either "glaringly improbable" or "contrary to compelling inferences": Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 at [28] - [29]).

Conclusion

The applicant has not demonstrated a clear case of material error in the primary judge's decision such as would warrant a grant of leave to appeal.

I would dismiss the application for leave to appeal with costs.

MACFARLAN JA: With some hesitation I have concluded that, for the reasons given by McColl JA, the application for leave to appeal should be dismissed with costs.

Contrary to Emmett JA's view and as McColl JA has held at [73] above, I consider that the primary judge was entitled to accept that one of the reasons for Dr Hanson's delay in service of the Statement of Claim was his concern not to aggravate unnecessarily his already antagonistic relationship with Mr Hunter. Dr Hanson's solicitor, Mr Bruce Burke, gave evidence that this was the case. That evidence was at least partly hearsay, being reflective of his communications with Dr Hanson, but was nevertheless admissible under s 75 of the Evidence Act 1995 (NSW) because the proceedings were interlocutory. Furthermore, it was in part direct evidence because Mr Burke was, throughout, involved in the steps taken on behalf of Dr Hanson in the proceedings.

For good reason, authority indicates that this Court should be reluctant to interfere with a decision, such as that in the present case, that is interlocutory and concerned with a matter of practice and procedure (see Cornelius v Global Medical Solutions referred to in [56] of McColl JA's judgment). In the absence of any cross-examination of Mr Burke, I do not consider that inferences can or should be drawn by this Court which effectively contradict Mr Burke's evidence.

EMMETT JA: Mr Scott Hunter seeks leave to appeal from orders made by the District Court extending the time for service on him of a statement of claim filed by Dr Benjamin Hanson. By the statement of claim, Dr Hanson seeks damages from Mr Hunter for alleged defamation, injurious falsehood and breaches of s 42 of the Fair Trading Act1987 (NSW). The statement of claim was filed in the District Court on 4 February 2011.

Rule 6.2(4)(b)(i) of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), which were applicable to proceedings in the District Court, provided at the relevant time that an originating process was valid for service for one month after the date on which it was filed. Thus, the statement of claim filed on 4 February 2011 ceased to be valid for service after 3 March 2011. In fact, the statement of claim was not served on Mr Hunter until 21 June 2012. It was therefore stale at the time of service.

However, under r 1.12, the Court may, by order, extend or abridge any time fixed by the UCPR. The Court may extend time under r 1.12, either before or after the time expires and may do so after the time expires even if the application for extension is made after the time expires. On 4 May 2012, Bozic DCJ purported to grant leave to Dr Hanson to serve the statement of claim out of time. On 10 May 2013, his Honour made an order extending the time for service up to and including 21 June 2012.

By summons filed on 9 August 2013, Mr Hunter seeks leave to appeal from the orders made on 4 May 2012 and 10 May 2013. The ground of the proposed appeal is, relevantly, that the primary judge erred in holding that the application for orders under r 1.12 should be granted. A direction was given that, if leave be granted, the appeal be heard concurrently with the application for leave.

The sequence of events concerning and after the filing of the statement of claim on 4 February 2011 is important. I shall therefore briefly recount the relevant events.

On 5 February 2010, Mr Hunter sent a letter to the New South Wales Medical Board. In the letter, Mr Hunter said that he was concerned about Dr Hanson's use of his professional standing to coerce and intimidate a frail aged neighbour while, at the same time, prescribing medications and purporting to be his carer. Mr Hunter asserted that Dr Hanson had used the neighbour and his medical problems to propel his own case in a longstanding legal dispute, both in and outside of court, for personal advantage. Mr Hunter said that he wished to lodge complaints against Dr Hanson under the Medical Practice Act 1992 (NSW) (since repealed). The letter attached extensive materials relating to the complaint. Much of the material related to a dispute involving Dr Hanson, on the one hand, and Mr Hunter and the neighbour, on the other, concerning the construction of a roadway on an unformed Crown road.

On 28 March 2010, Mr Hunter wrote to the New South Wales Medical Board again, this time copying in the Health Care Complaints Commission, saying that he wished to make a further complaint against Dr Hanson. Mr Hunter alleged that Dr Hanson had given statements to the police in a request for an apprehended violence order against Mr Hunter and his wife. Mr Hunter asserted that the statements by Dr Hanson were false and vindictive and were designed as retaliatory action for the complaint made on 5 February 2010.

On 30 April 2010, Dr Hanson filed an application in the Local Court seeking apprehended personal violence orders against Mr Hunter and his wife. An interim order was made on that day that Mr Hunter must not assault or otherwise interfere with Dr Hanson, must not engage in any conduct that intimidates Dr Hanson and must not stalk Dr Hanson. Additional orders were made that Mr Hunter must not enter premises where Dr Hanson resides and must not approach or contact Dr Hanson, except through legal representatives. Mr Hunter was directed to attend the Local Court on 10 June 2010. On that day, bail undertakings were given by Mr Hunter to be of good behaviour and not to assault, harass, threaten or intimidate Dr Hanson. It appears from the evidence before the Court that those bail conditions continued in force until final apprehended personal violence orders were made on 16 February 2012, following completion of the proceedings in the Local Court.

On 14 December 2010, Dr Hanson's solicitors wrote to Mr Hunter saying that they were instructed to bring proceedings "for, inter alia, injurious falsehood" as a consequence of the complaints concerning Dr Hanson made by Mr Hunter to the New South Wales Medical Board on 5 February 2010 and to the New South Wales Medical Board and the Health Care Complaints Commission on 28 March 2010. The letter said that the fact that the complaints were false and malicious would render them indefensible "to the proposed proceedings". The solicitors said that Dr Hanson was prepared to desist in instituting proceedings for damages provided that Mr Hunter was prepared to apologise and withdraw his complaints forthwith. The letter said that, failing Mr Hunter's indicating that he was prepared to withdraw the complaints within seven days, Dr Hanson would "have counsel settle the final form of claim and proceedings will be brought". Dr Hanson's solicitors wrote again to Mr Hunter on 11 January 2011 seeking confirmation of receipt of the earlier letter of 14 December 2010.

As I have said, the statement of claim was filed on 4 February 2011. In the statement of claim, Dr Hanson complained of two publications, being Mr Hunter's letter of 5 February 2010 to the Medical Tribunal and his letter of 28 March 2010 to the Medical Tribunal and the Health Care Complaints Commission. The proceedings commenced by filing the statement of claim were given a return date of 25 February 2011. On that day, Mr Burke, the solicitor for Dr Hanson, informed Bozic DCJ that the statement of claim had not been served and that "there are some difficulties". At the request of Mr Burke, the proceedings were adjourned for further directions on 22 April 2011.

On 31 March 2011, an attempt was made by a process server retained on behalf of Dr Hanson by his solicitors to serve the statement of claim at a rural property in New South Wales owned by Mr Hunter. A person at the property, who identified himself as "Tom", informed the process server that, while Mr Hunter owned the property, he lived in Sydney and occasionally came to the property at the weekends but not every weekend. The process server reported to Dr Hanson's solicitors that he had been informed that "if the matter was concerning HANSON ... they know how to contact SCOTT HUNTER". There was no evidence of any further attempt to serve the statement of claim before May 2012. I shall deal later with the subsequent service of the statement of claim.

The proceedings next came before the District Court on 29 April 2011, when Mr Burke informed Bozic DCJ that the statement of claim still had not been served. Mr Burke said:

There are some issues there ... it is a very funny case. If it could be stood over generally with liberty to restore once I serve or get together an application for substituted service ....

Bozic DCJ declined to stand the proceedings over generally, but stood them over to 8 July 2011 for further directions, with liberty to apply on 3 days' notice.

On 8 July 2011, the proceedings came before Truss DCJ. Ms Traill of counsel appeared for Dr Hanson and informed Truss DCJ that the statement of claim had not yet been served. Ms Traill informed her Honour that there was an appeal to the Court of Appeal to be heard on 22 August 2011 concerning absolute privilege of complaints to the Medical Tribunal. She indicated that that question arose in the proceedings between Dr Hanson and Mr Hunter in relation to the complaints made by Mr Hunter to the Medical Tribunal. Ms Traill was referring to an appeal to this Court from a decision of the District Court in Lucire v Parmegiani [2010] NSWDC 115. Ms Traill told Truss DCJ:

We have tried to serve the statement of claim but there has been problems. The defendants live in a country property but not all the time. There's other related issues ... and there's some AVO proceedings on foot in 1, 2, 7 and 8 August. And a related Supreme Court matter commencing on 15 August. [sic]

Ms Traill asked Truss DCJ to stand the matter over to a day one month after 22 August 2011 "to be safe". She said that "the issues might all go away". Truss DCJ asked whether it was intended to serve the statement of claim in the meantime because it was "going to go stale soon". Ms Traill said that they would try to serve it but that they would probably wait at least until "after the AVO proceedings so it won't make matters worse". Truss DCJ stood the proceedings over for further directions on 23 September 2011.

On 23 September 2011, Ms Traill again appeared for Dr Hanson and informed Elkaim DCJ that the statement of claim had not been served. She referred to the proceedings in the Court of Appeal, saying "we're just waiting for a decision". The proceedings were stood over to 9 December 2011.

On 9 December 2011, Ms Buck appeared for Dr Hanson and informed the District Court that the defendant had still not yet been served. Ms Buck asked that the proceedings be stood over to early 2012, "because there's a Court of Appeal matter". She said that those proceedings concerned comments made to the Medical Tribunal. The present proceedings were stood over to 3 February 2012.

On 3 February 2012, the proceedings again came before Bozic DCJ for directions. Mr Burke, who again appeared for Dr Hanson, said:

This is a strange matter that hasn't been served ... because we are preserving our position because of a Court of Appeal matter that will change the law or not. That was to be handed down this week. It was not. ... it's just been a nightmare, but we are only preserving the position of our client [pending that decision].

The proceedings were stood over to 2 March 2012.

In the meantime, the proceedings relating to apprehended personal violence orders brought by Dr Hanson and others in the Local Court had been heard on 20 May 2011, 1, 2, 8, and 9 August 2011, 27 October 2011 and 15 November 2011. On 16 February 2012, final orders against Mr and Mrs Hunter were made in favour of Dr Hanson and the other applicants. Mr and Mrs Hunter then appealed against that decision of the Local Court, but the appeal was unsuccessful.

On 2 March 2012, Elkaim DCJ was informed that whether the matter would proceed was contingent on the decision in the Court of Appeal that had still not yet been handed down. His Honour was asked to adjourn the proceedings for two months. His Honour was informed that the adjournment was not by consent because the defendant had not been served. Elkaim DCJ asked whether that will "take you out of your serving time". The response was:

Those are issues that we are going to need to consider. There's no point in the proceedings continuing if the Court of Appeal decision finds against ... our client's grounds.

Elkaim DCJ stood the proceedings over for directions on 4 May 2012.

On 4 May 2012, Ms Traill, who again appeared for Dr Hanson, said to Bozic DCJ:

... a statement of claim was filed on 4 February 2011 and it has been in a holding pattern in the list because we were waiting for a decision of the Court of Appeal ... which just came out ... so what we would be seeking is to now serve the statement of claim out of time, and then bring it back for mention in June.

In response to an enquiry from Bozic DCJ as to whether any order about the service of the statement of claim was needed, Ms Traill responded as follows:

We had a bit of trouble. We initially tried to serve it and we had a bit of trouble, but we know where they are now. I think maybe I just need an order, leave granted to serve out of time.

His Honour purported to grant leave to Dr Hanson to serve the statement of claim "out of time" and adjourned the proceedings to 22 June 2012.

It is significant that Bozic DCJ did not purport to make an order under UCPR r 1.12 extending the time limited by r 6.2(4)(b)(i). Further, his Honour fixed no limit as to the time by which the statement of claim should be served. It seems unlikely that his Honour would have intended to grant an extension of time for service without any limit on the extension. It is possible, therefore, that his Honour assumed that the statement of claim had been served, such that the effect of that order would be to confirm whatever service had been effected. Be that as it may, I consider that the order of 4 May 2012 was ineffective to extend the time limited by r 6.2(4)(b)(i).

UCPR r 1.12 authorises an extension of time. It does not authorise a court to waive altogether the effect of UCPR r 6.2(4)(b)(i). That is to say, the order made by Bozic DCJ did not in its terms purport to extend time. Rather, it literally had the effect that there was no longer any time limit on the service of the statement of claim. In any event, in the present case, no great deal of significance can be attached to that order, since his Honour subsequently made a further order that was clearly within the power conferred by UCPR r 1.12.

On 10 May 2012, Dr Hanson's solicitors gave instructions to a firm of investigators to serve the statement of claim on Mr Hunter. The process server made attempts to serve Mr Hunter on 19 May 2012, 21 May 2012, and 24 May 2012. On 20 June 2012, Mr Hunter received a telephone call from the solicitor who was appearing for him in the Local Court proceedings. That was the first time that Mr Hunter became aware of the District Court proceedings. Mr Hunter gave instructions to his solicitor to accept service of the statement of claim, which the solicitor did on 21 June 2012.

It is unclear what happened on 22 June 2012, the day to which Bozic DCJ had adjourned the proceedings on 4 May 2012. However, on 26 July 2012, Mr Hunter filed a notice of motion seeking that the order made by Bozic DCJ on 4 May 2012 be discharged under UCPR r 12.11(1)(e) or, alternatively, be set aside under r 36.16(2)(b).

Bozic DCJ heard argument on Mr Hunter's motion on 10 August 2012. At the conclusion of submissions, Dr Hanson sought leave to re-open his case. Thereafter, the parties agreed on a timetable for further evidence and written submissions. The hearing of the motion proceeded on 25 January 2013. On that day, Dr Hanson filed a notice of motion seeking an order under UCPR r 1.12 that the time for service of the statement of claim be extended up to and including 21 June 2012. On 10 May 2013, for reasons published on that day, his Honour ordered that Mr Hunter's notice of motion be dismissed. On Dr Hanson's motion, his Honour ordered that the time for service of the statement of claim be extended up to and including 21 June 2012.

Reasons of Bozic DCJ

Bozic DCJ referred to two reasons advanced for the delay in service of the statement of claim and as to why Dr Hanson was reluctant to proceed with service of the statement of claim. The first was dependence on the outcome of the appeal in Lucire v Parmegiani. The second reason was that, because of the sensitivities surrounding the proceedings in the Local Court, Dr Hanson was concerned not to aggravate the situation between himself and Mr Hunter unnecessarily. Accordingly, it was said, following the initial unsuccessful attempt at service, Dr Hanson had instructed his solicitor not to serve the statement of claim pending the decision of the Court of Appeal.

Bozic DCJ found that the delay was brought about by a combination of Dr Hanson not wanting to aggravate the existing hostilities unnecessarily by serving a statement of claim and in circumstances where the Court of Appeal might determine that he had no cause of action. His Honour reached that conclusion because Mr Burke said that they were the instructions he received from Dr Hanson on 1 April 2011, and because, at the hearing on 8 July 2011, Ms Traill had referred to waiting at least until the Local Court proceedings, so that it would not "make matters worse". His Honour concluded that, while the date on which the decision of the Court of Appeal was to be handed down was beyond Dr Hanson's control, the decision not to serve the statement of claim until that time was a deliberate decision taken by him as plaintiff.

Bozic DCJ then considered whether Mr Hunter had been adequately notified of the possibility of litigation. His Honour considered that, while the letters of 14 December 2010 and 11 January 2011 did not expressly refer to a defamation claim, the letter of 14 December 2010 made it clear that Dr Hanson asserted that the allegations in the letters sent by Mr Hunter to the Medical Board were false, malicious and indefensible in any legal proceedings. His Honour considered that the letter of 14 December 2010 foreshadowed legal proceedings unless there was an apology and withdrawal of the complaints.

Bozic DCJ considered several other matters as relevant to the exercise of the discretion to extend the time for service. His Honour concluded that, although general prejudice may be presumed from a lapse of time, there was no evidence of any particular or general disadvantage to Mr Hunter arising from the delay. His Honour also had regard to the fact that, if the order were to stand, it would more than double the limitation period under the Limitation Act1969 (NSW) ("Limitation Act") and that that would be contrary to the specific policy considerations evident in s 56A of that Act.

Bozic DCJ observed that Dr Hanson was faced with the decision of Lucire v Parmegiani in the District Court that, if it stood, would mean that there would be no point in serving the statement of claim on Mr Hunter. His Honour considered that, once served, it was highly likely that Mr Hunter would have sought legal representation and advice, with the inevitable cost consequences that that would have involved for both parties. His Honour did not consider that the case could fairly be described as one in which Dr Hanson unilaterally and without judicial endorsement or rational cause arrogated to himself a stay of the proceedings. He did not consider that the failure to serve the statement of claim, while the issue of whether the letters to the Medical Board were covered by absolute privilege was still undecided, could be regarded as so unreasonable and lacking a rational explanation or basis as to weigh heavily in the balancing exercise required.

Bozic DCJ concluded that the two reasons given by Dr Hanson for not serving the statement of claim constituted good reasons in combination. His Honour considered that Dr Hanson had taken reasonable steps to have the statement of claim served after the order was made on 4 May 2012, since his solicitors had written to the process servers instructing them to serve the statement of claim six days after the order had been made. His Honour therefore extended the time for service up to and including 21 June 2012.

The Appeal

The decision of Bozic DCJ involved the exercise of discretion. The question is whether the exercise miscarried by the application of an incorrect principle, the failure to take into account relevant considerations or taking into account irrelevant considerations. That is to say, there must be some error of law, a material error of fact, a failure to take into account some material consideration or the taking into account of an irrelevant consideration. Alternatively, it must be shown that the decision is so unreasonable as to suggest that one of those types of errors must have been committed even though it does not appear on the face of the reasons (see House v The King [1936] HCA 40; 55 CLR 499 at 504-5).

A plaintiff who does not commence proceedings until just before expiry of the limitation period should be especially diligent in pursuing prompt service. An important aspect of the public policy behind the limitation period is that a potential defendant should be made aware of claims against him within a reasonable time. Delay in service is particularly serious if it occurs after the expiration of the limitation period (see Tolcher v Gordon [2005] NSWCA 153 at [3]).

In considering whether an extension of time for service of originating process should be granted, it is necessary to take account of the nature of, the reasons for and the effects of delay in effecting service. Where the delay involves a considerable period, where the delay is quite deliberate, there being no question of mishap or oversight, and where no notice is given to the prospective defendant such as to mitigate the prejudice that the defendant may otherwise suffer through delay in actual service, it is necessary to weigh that delay against the plaintiff's effective loss of its rights against the defendant, if the extension were not granted. Such a prejudicial consequence to the plaintiff will always be present whenever extension of time is in question after a limitation period has run its course. However, where that prejudice is self-inflicted, in the sense that the defendant has done nothing to induce delay or to encourage a belief that the claim might be settled without recourse to litigation, the appropriate course may well be to refuse to extend time (see Van Leer Australia Pty Ltd v Palace Shipping KK [1981] HCA 11; 180 CLR 337 at 350-351).

In the statement of claim, Dr Hanson complained of two defamatory publications, being the letters to the Medical Board of 5 February 2010 and 28 March 2010. Section 14B of the Limitation Act provides that an action on a cause of action for defamation is not maintainable if brought after the end of a limitation period of one year running from the date of the publication of the matter complained of. Thus, the statement of claim, filed on 4 February 2011, was filed one day before the expiration of the limitation period in respect of the first publication.

As a matter of public policy, the limitation period for defamation is significantly shorter than for other causes of action. However, provision is made for extending the limitation period in limited circumstances. Thus, under s 56A of the Limitation Act, a person claiming to have a cause of action for defamation may apply for an order extending the limitation period for the cause of action. Under that provision, a court must, if satisfied that it was not reasonable in the circumstances for the plaintiff to have commenced an action in relation to the matter complained of within one year from the date of the publication, extend the limitation period mentioned in s 14B to a period of up to three years, running from the date of the publication. A court may not order an extension of the limitation period other than in the circumstances just described.

A relevant factor to be taken into account, when considering an application for extension of time, is whether the defendant is aware that he has been joined as a defendant in proceedings and is cognisant of the nature of the claims made against him. Such knowledge would go some distance towards mitigating the prejudice that a defendant might otherwise suffer through delay in actual service, where the defendant is unaware of the proceedings until service is actually effected (Agricultural & Rural Finance Pty Ltd v Kirk [2011] NSWCA 67 at [123]).

It is one thing, as was the case in Kirk, when a prospective defendant is informed of proceedings that have been commenced, but which the plaintiff does not wish to prosecute for the time being, pending the decision in a related test case. It is another matter altogether when the plaintiff commences proceedings and elects not to inform the defendant that the proceedings have been commenced, but takes to himself the decision as to whether the proceedings should be prosecuted pending the determination of a case that the plaintiff regards as a test case. It is one thing where the test case would resolve the whole of the prospective claim. It is another, as in the present case, where the putative test case would resolve only some of the causes of action in the proposed claim, namely, those relating to defamation.

Bozic DCJ considered that the letters of 14 December 2010 and 11 January 2011 were sufficient notification to Mr Hunter that it was likely that Dr Hanson would commence proceedings against him if he did not withdraw his complaints to the Medical Tribunal. However, as his Honour accepted, neither of those letters refers expressly to a claim for defamation. The fact that, within four weeks, a period that included Christmas and New Year, Mr Hunter was pressed for a response indicates that, if proceedings were to be commenced as threatened, they would be commenced imminently. Indeed, that is what Dr Hanson's solicitors did. Nevertheless, it was more than seven weeks before a single attempt was made to serve the statement of claim. Clearly, at that stage, it was intended to serve Mr Hunter notwithstanding that the proceedings in the Local Court seeking apprehended personal violence orders were still on foot and that the decision in Lucire v Parmegiani had been given in the District Court.

Dr Hanson advanced two reasons as to why the period limited by UCPR r 6.2(4)(b)(i) should be extended. The first was that mentioned on several occasions to the District Court, namely, that he was awaiting a decision of the Court of Appeal. It was said that, if the Court of Appeal had determined that communications to the Medical Board were the subject of absolute privilege, it was unlikely that Dr Hanson would have proceeded with his cause of action. It is very material, of course, that his claims in the statement of claim were not limited to claims in defamation. There was no evidence from Dr Hanson himself as to what his position would have been had the Court of Appeal reached a different conclusion, though the trial judge found it "unlikely" that Dr Hanson would have proceeded with his claim in those circumstances. In any event, it is not for a plaintiff to decide whether or not to comply with the UCPR simply because he might not have a good cause of action. There is no reason why the statement of claim could not have been served and an adjournment sought, after notice to the defendant, pending the decision in the Court of Appeal.

The second reason advanced by Dr Hanson to support the extension of time is that he was reluctant to proceed with service of the statement of claim because of sensitivity surrounding the proceedings in the Local Court. It was asserted that Dr Hanson was concerned not to aggravate the situation unnecessarily and had accordingly instructed his solicitor not to serve the statement of claim pending the decision of the Court of Appeal, after the initial unsuccessful attempts at service.

It is curious that Dr Hanson was so sensitive in relation to taking proceedings against Mr Hunter that he made attempts to serve the statement of claim on 31 March 2011 notwithstanding that the Local Court proceedings had been on foot since April 2010, but then, for reasons that were totally unexplained, decided not to attempt to serve the statement of claim because of a concern about sensitivity. Nevertheless, although the Local Court proceedings were concluded on 16 February 2012, it was not until after the Court of Appeal's decision had been given, on 20 April 2012, that the sensitivity apparently evaporated. There was no evidence of any change of mind on the part of Dr Hanson. The clear inference that is open is that the currency of the Local Court proceedings had nothing to do with the failure to serve the statement of claim in accordance with the UCPR and the failure to make any application to extend the time for service until 4 May 2012. As recounted above at [89], from 10 June 2010 until 16 February 2012, bail conditions in the nature of the orders of an apprehended personal violence order were operative against Mr Hunter. That is to say, from before the time of filing of the statement of claim on 5 February 2011, Mr Hunter was required not to assault, harass, threaten or intimidate Dr Hanson, under threat of imprisonment.

There was no satisfactory explanation for the change of mind in relation to the Local Court proceedings. That being so, there was no justification for delaying service simply because of the possibility that an appeal to the Court of Appeal in unrelated proceedings would be upheld. Dr Hanson provided no good explanation for an extension of time.

The District Court was informed on a number of occasions that there had been problems with service. There was no evidence before Bozic DCJ as to what the problems were. The lawyers acting for Dr Hanson in relation to the proceedings in the Local Court would appear to have had no difficulty in finding Mr Hunter. Immediately after the lawyers acting for Mr Hunter in relation to the Local Court proceedings were informed of the District Court proceedings, instructions were given to accept service of the statement of claim. Bozic DCJ concluded that the evidence did not support a finding that Mr Hunter endeavoured to evade service. Rather, there was simply no attempt made to serve him within the period mandated by the UCPR, notwithstanding the somewhat evasive comments made to the District Court.

Mr Burke was not cross-examined. However, there was no reason to doubt that he had received the instructions that he said he had received. On the other hand, it was not possible to test the assertion made as to Dr Hanson's reasons for not wishing to have the statement of claim served. There was no reluctance to attempt to serve Mr Hunter within seven weeks after filing the statement of claim, that is, on 31 March 2011. Further, the currency of the Local Court proceedings and the decision of the District Court in Lucire v Parmegiani must be taken to have been known to Dr Hanson and his legal advisers at that time. In those circumstances, it was incumbent upon Dr Hanson to adduce evidence to explain why there was a change of heart after 31 March 2011.

I do not consider that the material before Bozic DCJ justified a conclusion that a satisfactory explanation had been offered for the delay in serving the statement of claim. No attempt was made to seek an extension of time in circumstances where the attention of Dr Hanson's legal advisers was drawn to the necessity as early as 8 July 2011. The only inference open is that Dr Hanson, or those advising him, assumed for themselves the right to keep on foot the option of proceeding against Mr Hunter without informing him.

There was no reason why the statement of claim could not have been served, together with a communication to Mr Hunter to the effect that Dr Hanson would not proceed with the claim if the appeal to the Court of Appeal were dismissed. If Mr Hunter had insisted on the matter proceeding, he would have done so at his own risk as to the costs that might be incurred. It is not credible that, in circumstances where the Local Court proceedings were on foot, Dr Hanson was concerned to avoid Mr Hunter incurring costs unnecessarily.

I consider that Bozic DCJ erred in failing to have regard to the fact that there was no evidence to explain why Dr Hanson, or those advising him, changed their minds about attempting to serve the statement of claim after the first attempt. The absence of such evidence, coupled with the absence of any evidence at all from Dr Hanson as to his reasons for delaying the service of the statement of claim, casts significant doubt on the reliability of the hearsay assertion by Mr Burke as to the reason for delaying service. The suggestion that Dr Hanson did not wish to inflame matters is simply not credible. That gave rise to a failure to take into account a material consideration. I consider that the exercise of discretion by Bozic DCJ miscarried.

I would grant leave to appeal and uphold the appeal. The orders purporting to extend time for service should be set aside. Dr Hanson should pay Mr Hunter's costs of the appeal and of the proceedings in the District Court.

**********

Decision last updated: 13 August 2014

Medium Neutral Citation:	Hunter v Hanson [2014] NSWCA 263
Hearing dates:	10 March 2014
Decision date:	13 August 2014
Before:	McColl JA (at [1]), Macfarlan JA (at [79]), Emmett JA (at [82]
Decision:	Application for leave to appeal dismissed with costs [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	PRACTICE AND PROCEDURE - extension of time for service - respondent filed statement of claim pleading causes of action in defamation and others shortly before limitation period for defamation causes of action expired - statement of claim not served on applicant within time limited by UCPR 6.2(4)(b)(ii) - respondent decided not to serve statement of claim until judgment in an appeal from a decision which if correct afforded a defence of absolute privilege to his defamation causes of action was delivered and also to avoid aggravating situation with applicant in respect of whose conduct he had sought an APVO - after APVO order granted and appeal judgment delivered respondent obtained leave to serve statement of claim out of time - exercise of judicial discretion to extend time - whether "good reasons" for delay in service - whether knowledge of sufficient facts to plead statement of claim determinative against extension of time - effect of expiration of limitation period on extension of time for service application
Legislation Cited:	Civil Procedure Act 2005 (NSW) Defamation Act 2005 (NSW) District Court Act 1973 (NSW) Evidence Act 1995 (NSW) Fair Trading Act 1987 (NSW) Limitation Act 1969 (NSW) Medical Practice Act 1992 (NSW) High Court Rules 1952 (Cth) Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited:	Agricultural & Rural Finance Pty Limited v Kirk [2011] NSWCA 67; (2011) 82 ACSR 390 Battersby v Anglo-American Oil Co Limited [1945] KB 23 Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541 Brown v Coccaro (1993) 10 WAR 391 Carey v Australian Broadcasting Corporation [2012] NSWCA 176; (2012) 84 NSWLR 90 Cornelius v Global Medical Solutions Australia Pty Ltd [2014] NSWCA 65; (2014) 98 ACSR 301 FAI Insurances Ltd (in liq) v Mainprize [2006] NSWSC 554 Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 Foxe v Brown [1984] HCA 69; (1984) 59 ALJR 186 Hanson and Others v Hunter and Another (Local Court (NSW), Pinch LCM, 16 February 2012, unrep) House v The King [1936] HCA 40; (1936) 55 CLR 499 IMB Group Pty Ltd (in liq) v ACCC [2006] QCA 407; [2007] 1 Qd R 148 Kleinwort Benson Ltd v Barbrak Ltd [1987] AC 597 La Macchia v Minister for Primary Industries & Energy (1992) 110 ALR 201 Lucire v Parmegiani [2012] NSWCA 86 Lucire v Parmegiani [2010] NSWDC 115 Micallef v ICI Australia Operations Pty Ltd [2001] NSWCA 274 Muirhead v Uniting Church in Australia Property Trust (Q) [1999] QCA 513 Noonan v MacLennan [2010] QCA 150; [2010] 2 Qd R 537 Re Brashs Pty Ltd (1994) 15 ACSR 477 Rich v Long [2008] NSWSC 487 Rich v Packer [2007] NSWSC 1290 Simpson v Saskatchewan Government Insurance Office (1967) 65 DLR (2d) 324 Soper v Matsukawa [1982] VR 948 Tolcher v Gordon [2005] NSWCA 153 Van Leer Australia Pty Ltd v Palace Shipping KK [1981] HCA 11; (1981) 180 CLR 337 Victa Ltd v Johnson (1975) 10 SASR 496 Weston in Capacity as Special Purpose Liquidator of One.Tel Ltd (in liquidation) v Publishing and Broadcasting Ltd [2012] NSWCA 79; (2012) 88 ACSR 80
Category:	Principal judgment
Parties:	Scott Hunter - Applicant Benjamin Alan Hanson - Respondent
Representation:	Counsel: K Smark SC with S Chrysanthou - Applicant R Lancaster SC with K Traill - Respondent Solicitors: Kalantiz Lawyers - Applicant Banki Haddock Fiora - Respondent
File Number(s):
Publication restriction:	No
Decision under appeal	Date of Decision: 2013-05-10 00:00:00 Before: Bozic DCJ