Jefflane Pty Ltd v Masterview Paddington Pty Ltd

[1999] QCA 451

99.451

COURT OF APPEAL

DAVIES JA
PINCUS JA
WILLIAMS J

Appeal No 8406 of 1999

JEFFLANE PTY LTD  Applicant/Defendant

v.

MASTERVIEW PADDINGTON PTY LTD        Respondent/Plaintiff

BRISBANE

..DATE 29/10/99

JUDGMENT

DAVIES JA: This is an application for leave to appeal, pursuant to s.118 of the District Court Act, from an order of a District Court judge on 6 September last dismissing the applicant defendant's application to strike out the plaintiff respondent's action and granting leave to the respondent to further amend its plaint in accordance with a specified draft.

The action has a long and unfortunate history of delay caused entirely by the plaintiff respondent.

The original plaint was issued on 6 November 1998.  A paragraph in it alleging facts upon which a rectification claim was based was struck out on 24 February 1999.  Despite numerous complaints about delay in amending the pleading it was not until 20 May 1999 that a further amended pleading was filed and served.

On 26 February the applicant requested an amended pleading within 14 days.  On 9 March the respondent promised one "shortly".  On 27 April the applicant again wrote noting that more than two months had passed and warning of the potential prejudice that it might suffer in consequence of further delay in filing and serving a pleading because it was said that one of the applicant's possible primary witnesses was dying of cancer and that there was no point in taking a brief from him until an amended pleading was received.

Up to that point the factual basis for the rectification claim was unclear but it was possible that it depended on a conversation with Mr Wilson, the witness to whom I have just referred.

It perhaps would have been prudent for the applicant in the circumstances to take a brief from Mr Wilson and at least in a general way that was done.  As it turns out it would not have been a great deal of help as to the specific agreement alleged to found the rectification claim.

The factual basis for the rectification claim in the further amended pleading of 20 May was much the same as that in the original plaint.  It was alleged in general terms however that it was "mutually agreed and intended", without suggesting the basis for that agreement, that the respondent would contribute to outgoings in the proportion that the area of the demised premises bore to the total lettable floor area of the land on which those outgoings were chargeable.  But as I say, the source of that mutual agreement or intention was not stated.

Mr Wilson died on 13 June 1999 and on 30 June the applicant took out another summons to strike out parts of the amended plaint including again paragraph 9, the paragraph to which I have been referring.

On 8 July that summons was adjourned by consent on the understanding that the respondent would deliver an amended pleading within 21 days.  However, on 7 July the applicant's solicitors had written to the respondent's solicitors saying that their client reserved its right to object to any amendment on any ground including prejudice and in that regard informing them that Mr Wilson had died.

On 28 July the respondent promised an amended pleading within 10 days but none came, and notwithstanding a number of complaints from the applicant's solicitors no amended plaint was produced by 1 September when the applicant applied to strike out the action for want of prosecution.

On the following day a proposed further amended plaint, the plaint now relied on as the pleading, was served.

This proposed amended plaint pleads rectification in a way materially different from the way in which it had been pleaded previously. It alleges an agreement made orally between Mr Austin on behalf of the respondent and Mr Wilson on behalf of the applicant that the plaintiff would pay to the defendant 20 per cent of undivided outgoings until the amount for rates, land tax and fire levy could be calculated and that when the amount would be calculated that the excess, that is the difference between that and the amount based on the proportion of lettable floor area, would be repaid.

As I have already mentioned this was the first time in which it was alleged specifically that the agreement was based on an oral conversation and it was an agreement in terms different from that previously alleged.

The applicant has undoubtedly been prejudiced by the respondent's delay and by its failure to formulate the claim in the way it has until 2 September.  But the learned trial judge concluded, and the contrary has not been asserted, that the respondent is not time barred in respect of the majority of its claim.  That seems to be correct.

The action is primarily one for rectification and in respect of that there is of course no time bar, the only question being one of laches or acquiescence. 

And as to the claim based on the agreement, if it is rectified, most of that claim seems to be within the six year limitation which would be applicable for actions in contract.

It follows therefore that if the present plaint were struck out or the action struck out entirely the respondent could commence proceedings afresh, though it would no doubt be met with, if that occurred, a defence of laches.

It has also been mentioned and it was mentioned before his Honour that the applicant has sued the directors of the respondent as guarantors for rent which is said to be due and owing and it was submitted that the matters to which I have referred, the rectification claim and the amount said to be due under the agreement as rectified, could be set off in that action.  It is unnecessary, in my view, to decide that question and his Honour the primary judge did not attempt to do so.

His Honour said that the most decisive feature in favour of allowing the tenant, that is the respondent, to continue lay in the fact that a consent order was allowed to permit appropriate amendments to be made in July this year after Mr Wilson's death.

On the other hand, of course, there is the fact that the letter which had been written the day before that indicated the qualification which the applicant was putting upon that.

This is a case in which there has been dilatoriness of a substantial degree bordering, it seems to me, on recklessness.  The submission was indeed made that it was deliberate but I do not think there is sufficient evidence upon which a conclusion to that effect could be reached, and it also appears that it has resulted in prejudice to the applicant here.

On the other hand it seems to me that in matters of this kind there is room for differences of view as to balancing the relevant factors in allowing a matter such as this to proceed, notwithstanding the existence of dilatoriness and delay of the kind I have mentioned and the possibility of quite serious prejudice to the applicant here.  Different minds would no doubt differ as to the consequences of that.

The question before this Court primarily, of course, is one for leave and in my view having regard to the fact that this involved, as it plainly did, an exercise of discretion on matters on which minds may differ, I cannot be satisfied that this is a matter of sufficient importance or sufficient prejudice to the applicant here to justify the granting of leave.

I would therefore refuse the application for leave to appeal.

PINCUS JA:  I agree with the reasons that Mr Justice Davies has given and would add only, in respect of chamber work in the District Court, that this Court cannot and should not undertake routinely to review it.

The case in question does not appear to me to be one in which one could conclude that the decision which was given below was plainly wrong or plainly based upon erroneous considerations.

In those circumstances, I agree with the order which Mr Justice Davies proposes.

WILLIAMS J:  The relevant facts have been fully set out in the reasons of Mr Justice Davies.

The application raises for consideration the exercise of a discretion on a procedural issue.  No point of principle is involved.

The question is essentially whether the decision reached was within the bounds of a proper exercise of discretion.  I cannot conclude that it so clearly was not that it would be appropriate to grant leave to appeal.

I agree with the order proposed.

DAVIES JA:  Application for leave refused.

...

DAVIES JA:  With costs.

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