Matthews v Whites Hill (SA) Pty Ltd & Anor - [2019] SASC 78

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
MATTHEWS v WHITES HILL (SA) PTY LTD & ANOR
[2019] SASC 78
Reasons for Decision of The Honourable Justice Hughes
21 May 2019
PROCEDURE - COURTS AND JUDGES GENERALLY - COURTS - ADJOURNMENT
By application dated 14 May 2019, the defendants sought to vacate a trial listed to commence on 20 May 2019. The defendants had recently appointed new solicitors and the primary ground for the application was to allow them to prepare for trial. The application foreshadowed a further application to submit an expert report that had not yet been obtained and leave for which had not yet been granted. The defendants had previously succeeded on an application in similar but narrower grounds.
Held, application refused. Applicants to pay the respondent’s costs of the application.
Aon Risk Management Services Australia Ltd v Australian National University (2009) 239 CLR 175; Channel Seven Adelaide Pty Ltd v Manock [2010] SASCFC 59, applied.

MATTHEWS v WHITES HILL (SA) PTY LTD & ANOR
[2019] SASC 78
HUGHES J:

By application dated 14 May 2019 the defendants Whites Hill (SA) Pty Ltd and Brenton Strauss in action number SCCIV-16-967 (‘the applicants’) sought to vacate a trial which is listed to commence on Monday 20 May 2019 for five days. The application was supported by affidavits of Brenton Jeffrey Strauss and an affidavit of Gregory Michael Griffin both sworn on 14 May 2019. The plaintiff (‘respondent’) opposes the application. On Friday 17 May 2019 I heard the parties’ submissions and refused the application. These are my reasons for so doing.
The application was made as one of three applications, corresponding to three sets of proceedings that were listed to be heard together. The other proceedings are SCCIV-17-274 and SCCIV-17-275. Those two actions settled and I have made orders disposing of them.
The paramount consideration for my determination of the application is the just resolution of the proceedings.[1] The applicants claim that the just resolution of this application requires that the trial be vacated when consideration is given to the matters relevant to the just resolution of the proceedings. Those matters are:
[1] Channel Seven Adelaide Pty Ltd v Manock [2010] SASCFC 59 (‘Manock’).
1Whether there has been undue delay in making the application;
2The extent to which there will be wasted public resources in granting the amendment;
3Whether there will be inefficiency occasioned by the need to revisit interlocutory processes;
4Whether a trial date would need to be vacated or a trial adjourned;
5Whether there is any satisfactory reason for the delay in applying;
6Whether the point to be raised by the amendment would be raised in any event at the trial;
7The likelihood of strain and uncertainty being imposed on the litigants;
8Whether any further delay would undermine confidence in the administration of justice;
9Any other prejudice likely to be suffered by the other party; and
10The additional costs likely to be incurred.[2]
[2] Aon Risk Management Services Australia Ltd v Australian National University (2009) 239 CLR 175 (‘Aon’).
These factors, having been established in the context of an application to amend a pleading, were accepted by the parties to be applicable to an application to vacate a trial date. I accept that proposition particularly where the basis of the application is wholly or in part to enable steps to be taken preparatory to trial that carry a significant degree of likelihood that the applicants’ case at trial will be different from that which is the case at the time of the application. In contrast to the basis on which the applicants made their previous successful application to vacate, that is now the case.
The applicants were represented on the application, their new solicitors having filed a Notice of Acting at the same time as the application to vacate was brought. The second applicant, Mr Strauss, deposes to being informed by his recently-retained solicitors that they will only act for him if the trial is adjourned. This will enable them to assess the matter and retain counsel. The second applicant also deposed to having been advised by his solicitors to seek an adjournment in order to obtain fresh evidence in the form of an expert’s report to address the quantification of the loss allegedly caused to the company Sapphire of which the respondent is the liquidator, by the applicants’ actions.
The applicants submitted that they will suffer unavoidable prejudice if they are not able to present their case through counsel and with the appropriate evidence to meet the respondent’s claim. The applicants previously made a successful application to vacate an earlier trial date of 25 March 2019. They maintain that arrangements that they had put in place to be represented after I granted an adjournment were not fulfilled. One of my orders was that the applicants’ solicitors file Notices of Acting by 2 April 2019. This did not occur. The second applicant did however file an Outline of Submissions which he deposed (and it was evident) had been prepared by or with the significant assistance of, his solicitors.
Mr Strauss also deposed to having failed to make the payments required by 1 May 2010 by his former solicitors in order to secure representation for the trial. Thereafter, or about 3 May 2019, the applicants found themselves without representation.
The applicants then entered discussions with their current solicitors, Griffins Lawyers, with what they maintain to be reasonable diligence and speed. The second defendant’s first meeting with Mr Griffin was on 9 May 2019.
Mr Burnett SC submitted that the respondent, as liquidator, is not prejudiced by the delay of the proceedings. The applicants also maintain that the respondent is not ready to proceed in that certain losses of the claim have not been quantified notwithstanding that the Statement of Claim states that they will be.
The respondent maintained that he is ready to proceed to trial as scheduled. The respondent contended that a proper application of the principles in Aon Risk Management Services Australia Ltd v Australian National University[3] and Manock militate in favour of refusal of the application to vacate the trial. In Aon, the High Court allowed an appeal against the ACT trial court’s decision to allow a plaintiff to substantially amend its claim part-way through a trial that had involved two years of interlocutory steps. French CJ said:[4]
The Judicature Acts and associated Rules of Court are reflected in rr501 and 502 of the ACT Rules. The ACT Rules, like their precursors, confer the discretion to give leave to amend and impose the duty to make amendments for the purpose of deciding the real issues in, and avoiding multiplicity of, proceedings. The discretion is exercised in the context of the common law adversarial system as qualified by changing practice. But that is not a system which today permits disregard of undue delay. Undue delay can undermine confidence in the rule of law. To that extent its avoidance, based upon a proper regard for the interests of the parties, transcends those interests. Another factor which relates to the interests of the parties but transcends them is the waste of public resources and the inefficiency occasioned by the need to revisit interlocutory processes, vacate trial dates, or adjourn trials either because of non-compliance with court timetables or, as in this case, because of a late and deliberate tactical change by one party in the direction of its conduct in the litigation. These are matters which, even under the Australian versions of the Judicature Act system, unaffected by the sequelae of the civil procedure reforms of 1998 in the United Kingdom, are to be regarded as both relevant and mandatory considerations in the exercise of the discretion conferred by rules such as r 502.
[3] (2009) 239 CLR 175.
[4] Ibid 155.
Ms Di Girolamo on behalf of the respondent provided a chronology of the applicants’ defaults in these proceedings. The Statement of Claim was filed on 29 July 2016. At that time the applicants were represented by their first solicitors, Stewart Rattray and Associates. The defence was filed late. The respondent filed its list of documents on 15 December 2016 and the applicants did not file their list of documents until 16 June 2017. They subsequently conceded that their discovery was inadequate. On 18 January 2017 the respondent provided an expert report on insolvency. On 4 May 2018, nearly 18 months later, the applicants were provided three months to file an answering expert report. No report has ever been prepared or served. At an interlocutory hearing on 6 September 2018, the respondent requested a trial in 2018 but this was not granted. The applicants requested further time for preparation and the trial was set down for 25 March 2019. The applicants’ solicitors withdrew from the file with the Court’s consent on 1 February 2019, leaving the applicants without representation. At that point, the second applicant, Mr Strauss, advised the Court that he was obtaining an expert report. Bearing in mind that he was unrepresented, it was made clear to him that such a report would not necessarily be admitted. On 7 March 2019, the applicants filed an application for the trial to be vacated and deposed to the arrangements that they had made to secure new representation. They sought 90 days (reduced subsequently to 60 days) to allow their new solicitors to become acquainted with the materials and retain counsel. Argument was heard on 14 March 2019 and I delivered my reasons on 19 March 2019. The application was strongly resisted by the respondent. I granted that adjournment and set a new trial date for 20 May 2019. Counsel for the applicants conveyed to the Court that they were not instructed to seek new expert evidence. The defendants did not file and serve any additional documents in accordance with a permission that was granted to them at that hearing. I directed that Notices of Acting be filed by 2 April 2019 but this did not occur and the solicitors never became the solicitors of record in the matter. However, on 4 April 2019 the applicants filed comprehensive submissions that were clearly prepared with the assistance of their lawyers at the time.
The applicants’ submissions indicate that the applicants intend to supplement, and possibly even develop their case in a manner different from, that which is contained in their written submissions. It was further admitted by the applicants that the applicants’ new solicitors are now in possession of additional documents provided by the second applicant, the relevance of which is unclear as they have not yet been assessed.
The applicants currently do not have permission to adduce evidence of an expert after the matter has been set down for hearing. This application foreshadows an application to have the Court receive a further expert report.
The basis of this application is quite different from that which I heard and granted in March. The earlier application was made solely in order to enable the applicant to instruct new solicitors and counsel to represent the applicants in three actions. Whilst it was not conceded that there would be no application to admit an expert’s report not yet obtained, reliance upon that step was expressly disavowed. In the applicants’ current application, the need for an expert’s report is central to the application. This requires the court to consider the opportunities that the applicants have had to obtain such a report and the conduct of the applicants more broadly than that which was required when the compass of the application was narrower.
Having regard to the history of the matter, the just resolution of the proceedings demands that the trial now proceed as scheduled. The second applicant must have been aware of his inability to meet the financial requirements of his former lawyers prior to 1 May 2019. In any event, the vast majority of the evidence upon which the plaintiffs rely is known to the second applicant. He is intimately acquainted with the facts of the matter. He has been represented throughout the majority of the time that the action has been on foot. He is a businessman and has had the benefit of three sets of lawyers advise him as to his defence. The applicants have had the benefit of a detailed Outline of Argument filed by the respondent. Further, the conduct of their defence can be guided by their own Outline of Argument prepared on their behalf. The applicants are, in that sense, far better equipped than many unrepresented persons who come before this Court.
Nor do I accept that the applicants’ belated proposal to obtain an expert report should be facilitated. There is no new material fact to justify a delay of the trial on that basis. The applicants have been in possession of the expert report since 18 January 2017. The second applicant was made aware on several occasions that the respondent would oppose the obtaining of an expert report after the matter had been set down for hearing. As the respondent indicated, the obtaining of a further expert report is not simply a matter of awaiting the report but would entail providing the respondent’s expert an opportunity to comment upon it. To vacate the trial at this late stage would be to “reward the defendants by weighing in [their] favour the disruptive consequences of [their] own application.”[5]
[5] Ibid 194-195.
At a certain point in these proceedings the applicants decided to proceed without the benefit of a responding expert report. Such a report might have been to address insolvency or quantification of loss or both. The applicants have not availed themselves of those opportunities and it is now too late to do so.
The previous adjournment was for the purpose of solicitors to be briefed and counsel to be retained. That opportunity was provided but cannot be extended indefinitely. There is a real risk that there would be further delays and even that the new arrangements would founder. The proceedings must reach their conclusion at some point. It is now appropriate that the trial proceeds with the defendants unrepresented. The application is refused.
The respondent shall have his costs of the application.
As two of the matters that were originally listed to be heard with this proceeding have now settled, it is appropriate to reduce the number of days allocated for the hearing of the matter. The trial will proceed from 10.15 am on Tuesday 21 May 2019.