Maytom v Kennett
[2014] NSWSC 116
•26 February 2014
Supreme Court
New South Wales
Medium Neutral Citation: Maytom v Kennett [2014] NSWSC 116 Hearing dates: 4 and 11 February 2014 Decision date: 26 February 2014 Jurisdiction: Equity Division Before: Hallen J Decision: (1) Orders that the time for the filing of the Plaintiffs' summons to appeal and leave to appeal be extended to 6 November 2012, the date of the filing of the Summons.
(2) To the extent that it is necessary, grants leave, pursuant to s 40 of the Local Court Act 2007, to appeal from the judgments of the Local Court.
(3) Orders that the appeal is allowed.
(4) Orders, pursuant to s 41(1)(b) of the Local Court Act 2007, that the orders made by Magistrate Van Zuylen on 29 March 2012 be set aside.
(5) Orders that the judgment entered against each of the Plaintiffs on 11 April 2012 be set aside.
(6) Orders that the proceedings commenced by the Defendant be remitted to the Local Court, sitting at Parramatta, for determination.
(7) Orders, pursuant to s 7 of the Court Suppression and Non-Publication Orders Act 2010, that there be no publication or other disclosure of the identity of the first Plaintiff's child, or of any evidence or other material which would tend to reveal the child's identity.
(8) Orders that the Plaintiffs should pay the Defendant's costs thrown away in the Local Court on 29 March 2012, such costs to be limited to one half of the costs of the Defendant's solicitor and one half of the fees of Defendant's counsel, of 29 March 2012.
(9) Orders that the Defendant should pay the Plaintiffs' costs of the appeal, such costs to be limited to the amount of out-of-pocket expenses, of a type that would have been recoverable as disbursements if they had been legally represented and which they had actually and reasonably incurred.
Catchwords: APPEAL - Appeal from decision of Magistrate in Local Court - Judgment given when party does not appear when matter called on for hearing - Whether any appeal grounds involved a question of law - Whether to extent that they do not, leave should be granted - Where grounds asserted include inadequacy of reasons - Where no reasons given - clearly inadequate - error of law established
PRACTICE AND PROCEDURE - No reasons for decision - Necessity to determine identified issues - Appellate court not to be left to speculate whether an issue has been determined and reasons why judgment enteredLegislation Cited: Children and Young Persons (Care and Protection) Act 1998 (NSW)
Civil Procedure Act 2005 (NSW)
Court Suppression and Non-Publication Orders Act 2010 (NSW)
Local Court Act 2007 (NSW)
Local Court Practice Note Civ 1
Supreme Court Act 1970 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)Cases Cited: Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172
Asuzu v Council of the New South Wales Bar Association [2012] NSWCA 406
Beale v Government Insurance Office of New South Wales (1997) 48 NSLWR 430
Chand v RailCorp [2010] NSWCA 233
Commissioner for ACT Revenue v Alpha One Pty Ltd (1994) 49 FCR 576
Department of Premier and Cabinet v Hulls [1999] VSCA 117; [1999] 3 VR 331
Dunn v McCarthy QC [2007] NSWSC 1336
Escobar v Spindaleri (1986) 7 NSWLR 51
Fox v Percy [2003] HCA 22; (2003) 214 CLR 118
Gallo v Dawson [1990] HCA 30; (1990) 93 ALR 479
Getex Pty Ltd v Reed Business Information Pty Ltd [2013] NSWSC 1161
Gorczynski v AWM Dickinson & Son [2005] NSWSC 277
Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230
He v Hecker [2013] NSWSC 1219
Larsen v Vile [1999] NSWCA 397
Mifsud v Campbell (1991) 21 NSWLR 725
O'Brien v Doherty [2008] NSWSC 205
In the matter of Pan Pharmaceuticals Ltd (in liq) - Brennan v McGrath [2011] NSWSC 561
Outboard Marine Australia Pty Ltd v Byrnes [1974] 1 NSWLR 27
Sali v SPC Ltd [1993] HCA 47; (1993) 116 ALR 625
Stoker v Adecco Gemvale Constructions Pty Ltd [2004] NSWCA 449
Teague v Chin; Teague v Chin [2013] NTSC 72
3D Funtimes Ltd v Intellec Development Group Pty Ltd (No 2) [2011] FCA 407
Wiki v Atlantis Relocations (NSW) Pty Ltd [2004] NSWCA 174; [2004] 60 NSWLR 127
Wilson v Department of Human Services; Re Anna [2010] NSWSC 1489
Wilson v Department of Human Services; Re Anna (No 2) [2011] NSWSC 545
Young v Cesta-Incani [2007] NSWCA 229Category: Principal judgment Parties: Rachel Maytom (first Plaintiff)
Pamela Maytom (second Plaintiff)
Keith Kennett (Defendant)Representation: Counsel:
Ms R Maytom (in person)
Mrs P Maytom (in person)
Mr D Steirn (Defendant)
Solicitors:
Ms R Maytom (in person)
Mrs P Maytom (in person)
Frank Legal (Defendant)
File Number(s): 2012/345916
Judgment
Procedural history and nature of dispute
HIS HONOUR: The Plaintiffs in these proceedings, Rachel Maytom and her mother, Pamela Maytom, were defendants in Local Court proceedings commenced by the Defendant in these proceedings, Keith Kennett, by Statement of Claim filed in the Parramatta Registry on 18 November 2011. (I do not propose to use, in the body of this judgment, the same nomenclature as used in the Local Court proceedings but, rather, identify the parties as they appear, or as he appears, in the proceedings in this Court. However, in any passages quoted from the transcript of the Local Court proceedings, the parties will appear as they, or he, did in those proceedings.)
In early January 2012, the Plaintiffs each filed a defence to the Statement of Claim in the Local Court. The proceedings were listed for hearing, to take place in the Local Court at Parramatta, on 29 March 2012.
On 23 March 2012, the Plaintiffs filed a notice of motion seeking, amongst other relief, an order that the Defendant's Statement of Claim in the Local Court be struck out. The notice of motion was also listed for hearing on 29 March 2012.
On 29 March 2012, when the matter was first called, each of the Plaintiffs appeared in person, whilst the Defendant appeared by counsel, Mr P Bolster. Initially, the parties appeared before Magistrate Viney, who noted that there was no "Statement of Facts and Issues" (which was required by Local Court Practice Note Civ 1, A, paragraph 5). Her Honour also informed the parties that she had a full day criminal matter that had been stood over from the day before, which she was going to hear and that their matter may be heard by another Magistrate.
Following their appearance, some unsuccessful discussions took place between the parties to see if a "Statement of Facts and Issues" could be agreed. The Plaintiffs subsequently left the precincts of the Court and did not appear again when the matter was re-mentioned, at noon, before Magistrate Van Zuylen, who stood it down until later in the day (2:00 p.m.). They did not appear again when, at about 3:00 p.m., Magistrate Van Zuylen reached the matter.
The Defendants were called and, when they failed to appear, the learned Magistrate informed Mr Bolster that he had "looked at the paperwork" and proposed to give judgment in favour of the Defendant. There was then discussion between Bench and bar about the calculations of the judgment to be given against each Plaintiff.
On 29 March 2012, judgment was given in favour of the Defendant against the first Plaintiff for $41,442.38 plus costs "as assessed or agreed" and against the second Plaintiff for $80,231.48 plus costs "as assessed or agreed". A suppression order was made, also, to prevent the names of persons identified in psychological reports and statements from being reported.
I shall return to the more precise detail of events before each Magistrate later in these reasons.
On 10 April 2012, each of the judgments was entered. Various steps were then taken by, or on behalf of, the Defendant, to bankrupt each of the Plaintiffs. They defended those proceedings.
On 6 November 2012, the Plaintiffs filed a document in this Court headed "Summons Commencing an Appeal (Part 50) Summons Seeking Leave to Appeal (Part 50)". (Although the form of this document has altered over time, it is one filed on 1 August 2013, pursuant to orders by Slattery J, which is relied upon by them. I shall return to the relief sought in that document later in these reasons.)
On 14 December 2012, in the Duty List, the Plaintiffs made an oral application seeking an extension of time within which to commence an appeal from the Local Court orders entered on 10 April 2012. On that day, Bergin CJ in Eq, ordered that "the judgments entered against Rachel Maytom on 10 April 2012 and Pamela Maytom on 10 April 2012 are stayed until further order". Her Honour made the order "[n]otwithstanding the lateness of this application and the rather informal way in which it has been approached", noting that the Plaintiffs:
"have not taken steps to seek to appeal against the judgment until recently. That has been prompted, I gather, by [the Defendant] issuing a Bankruptcy Notice against each of them and proceeding in the Federal Magistrates Court. It is apparent that Ms Maytom, who is unrepresented, sought to have the Bankruptcy Notice set aside unsuccessfully and the matter is listed in the Federal Magistrates Court on 17 December 2012."
Her Honour also observed that "there is a serious issue to be tried about the way in which judgment was entered against the Maytoms ...".
Since those orders were made, there have been numerous appearances in this Court, including appearances before Slattery J, Lindsay J and, most recently, before Sackar J, as vacation Duty Judge, on 30 January 2013. There have also been numerous other appearances before Registrar Musgrave at which directions have been made.
On 7 June 2013, the first Plaintiff was appointed the tutor of the second Plaintiff and it is she who has conducted the case on behalf of both Plaintiffs.
On 13 September 2013, Slattery J made certain orders and directions relating to the amendment of what was described as the "Amended Summons commencing an Appeal". He described that document, which was, thereafter, to be relied upon, as follows: "RECEIVED 01 AUGUST 2013 initialled, dated today's date and placed with the Court papers".
The relief claimed in the Amended Summons (omitting amendments) was as follows:
"1 Leave for extension of time to commence appeal
2 Leave to appeal
3 If leave granted a stay of enforcement pending hearing of such appeal
4 Set aside the Orders of the Court below
...
5A That the matter be heard and determined by the Supreme Court as matter raises serious questions and concerns and will set precedent effecting [sic] the entire general public concerning private health workers, a counsellor, suing for damages his former clients.
6. Variation of the Orders of the Suppression and Non Publication Orders.
1. An Order suppressing the use of and publication of the real name and any identification leading to the true identity of the said minor. The minor may be granted leave for an alias so given by the Supreme Court.
2. Order for suppression and non Publication of the First and Second plaintiff's real names leading to their identity
3. Set aside the Local Court order for the Suppression and Non publication of the Health Worker (Counsellor's) real identity who initiated the proceedings, namely Keith Kennett.
...
8 Costs
9 Set aside of any cost/s order/s of the Supreme Court against the First and Second Plaintiffs.
10 In the event that any cost/s order/s made against the the [sic] First and Second Plaintiffs as per order 9 are not set aside, alternatively an order for it to be off set against any relief awarded to the Plaintiffs."
The "Appeal Grounds" were:
"...
1A Magistrate Van Zuylen Made Orders outside of the Local Courts [sic] powers and jurisdiction and not in accordance with Sec 29 Local Court Act 2007.
2 Magistrate failed to provide any reasons both orally and written pursuant to Uniform Civil Procedure Rule 36.2.
3. Suppression and Non Publication Order applied on Defendants [sic] request protecting all the Defendants [sic] actions and that of the Magistrate on the basis that its [sic] an adoptions proceeding, to which was not in existence and to which the Local Court has no jurisdiction.
3A Denied procedural fairness and the right to be heard on an Oral Application made on 29 March 2012 without notice and in our absence by Keith Kennett's Representation for the immediate Suppression and Non Publication of the Filed Statements of their client Keith Kennett whom was the one whom initiated the Proceedings and the names in the Psychological Reports.
3B Suppression Order made on a fact that did not exist, and to which the Local Court has no jurisdiction to deal with. Filed by Keith Kennett as a civil matter seeking personal damages pertaining to alleged professional services with the type of claim being filed as 'Mercantile Law' the matter was listed Suppressed by way of it being an 'Adoptions Proceeding Supreme Court'
3C The Suppression and non identification Order was made irregularly failing to identify and determine any grounds for such an order protecting Keith Kennett the initiator of the proceedings pursuant to Sec 8 Court Suppression and Non Publication Orders Act 2010.
...
3E Neglect and failure to specify the order pursuant to sec 12 (1) Court Suppression and Non Publication Act 2010 and a further failure to take into account the requirements of sec 12 (2).
3F 16 November 2012 eight months after disposal of this matter in the Parramatta Local Court Application by Rachel Maytom to set aside and or vary the nature of the Order of the Suppression and Non Publication Order Pursuant to sec 13 (1) was made, review as to the merit, need and legitimacy for the continuance of such suppression and non identification in regards to Keith Keith [sic] was not heard. The Defendants [sic] Solicitor opposed such Application.
...
5 Defendant failed to file and prepare statement of facts pursuant to both sec 15 Civil Procedure Act 2005 and sec 27 Local Court Act.
...
6A Defendant failed to specifically identify the 'type of claim' in his Statement of Claim filed before Parramatta Local Court.
...
7A Magistrate Van Zuylen neglected to deal entirely with a Notice of Motion to strike out Keith Kennett's claim which was filed and listed to be heard prior to any order of the court being made.
...
9 Denial of fairness, natural justice and the right to be heard"
In November 2013, the matter was listed, for hearing, before me on 4 February 2014. On 30 January 2014, the Plaintiffs brought the matter before Sackar J, as the vacation Judge. They sought leave to file a notice of motion seeking to vacate the hearing. His Honour, after discussion with the parties, stood the notice of motion over to the hearing before me, granted leave to the first Plaintiff to file her affidavit sworn 30 January 2014, and ordered that the costs of the day be the Defendant's costs in the cause.
During the proceedings before Sackar J, the parties agreed that the matter to be determined at the hearing before me was "a straightforward one or a discrete one ... [n]amely should the magistrate have entered judgment or not". The matter has proceeded before me on that issue. (The parties agreed, also, that the merits of the Plaintiffs' complaints about the conduct of the Defendant would not be the subject of argument before me, with the result that it is not necessary to trespass on issues of fact that would, if the judgments are set aside, be matters of factual dispute in the trial.)
On 4 February 2014, the Plaintiffs again appeared unrepresented, whilst Mr D Steirn of counsel appeared for the Defendant. The matter proceeded with the first Plaintiff reading the Amended Summons commencing an Appeal and her affidavit of 30 January 2014. She tendered, without objection, a copy of various documents relating to the events on 29 March 2012.
Mr Steirn, for the Defendant, read the affidavit of his instructing solicitor, Mr R D Webb, and tendered the bundle of documents exhibited thereto, which documents were said to form part of the Local Court file as at 29 March 2012. Mr Steirn also read an affidavit of Mr P Bolster, counsel who had appeared for the Defendant in the Local Court proceedings. He also tendered a copy of the orders entered on 10 April 2012.
The exhibit (Ex. RW 1) comprised 439 pages. Mr Webb was not cross-examined.
Despite Sackar J having raised with the first Plaintiff the possibility of further evidence going to the events of 29 March 2012 being potentially relevant, she served no further evidence. Before me, she made application for leave to give the evidence orally, which application was opposed.
During the short adjournment, I required her to inform counsel for the Defendant of the substance of the evidence that she proposed to give. I indicated that I would allow him an opportunity to obtain instructions and then permit him to cross-examine the first Plaintiff, if necessary, on another day. I then permitted the first Plaintiff to give that evidence.
Also, at about this time, the first Plaintiff stated that she wished to ask Mr Bolster some questions. No prior notice had been given to the Defendant's legal representative that Mr Bolster was to be required for cross-examination and he was then unavailable.
In all of these circumstances, I stood the matter over until 11 February 2014, but upon the basis that the parties would proceed to make submissions on all topics other than the evidence that the first Plaintiff had given, the evidence of Mr Bolster, and costs. I reserved the costs thrown away by the adjournment of the matter to a later date.
The parties agreed with this course, which allowed the matter to continue for the rest of the day leaving only a short time required to complete the proceedings. In this way, I was satisfied that each party would have a sufficient, and proper, opportunity, to ensure that all matters relevantly in issue were heard.
Although I made directions for the filing and service of any additional submissions, including on costs, none were filed by the Plaintiffs.
On 11 February 2014, the matter continued with the cross-examination of the first Plaintiff and then her cross-examination of Mr Bolster. Each party then made some further short submissions. (The first Plaintiff sought leave to make her submissions on costs subsequently, in writing, which application I refused.)
Brief Background
The relevant background facts may be stated shortly.
There had been proceedings in this Court, heard by Palmer J, in December 2010. His Honour had delivered reasons for judgment on 17 December 2010, the medium neutral citation of which is Wilson v Department of Human Services; Re Anna [2010] NSWSC 1489. Those proceedings involved the daughter of the first Plaintiff, who had been placed under the parental responsibility of the Minister for Human Services pursuant to an interim order of the Children's Court of New South Wales at Woy Woy made under the Children and Young Persons (Care and Protection) Act1998 (NSW).
The first Plaintiff had commenced those proceedings seeking the removal of the Children's Court proceedings into this Court and, in its parens patriae jurisdiction, an order for the return of the child to her.
Following a contested hearing which lasted three days, the first Plaintiff's application succeeded. Palmer J concluded that the Court should retain the supervision of the child until a final order as to her care was made and gave directions regarding the steps that should be implemented to achieve that result.
In the proceedings in the Children's Court from which the proceedings before Palmer J were brought, the Defendant was a witness. In addition, the Defendant is alleged to have provided other professional services to the first Plaintiff and persons associated with her.
In the Children's Court, the Defendant had been cross-examined about his qualifications and experience. There was said to be an issue raised about those qualifications and his experience. It is that issue which, principally, gives rise to the defence by the Plaintiffs of the Defendant's claims in the Local Court.
The Events in the Local Court
It is now necessary to deal with the events leading to the entry of judgment in the Local Court in more detail. I have relied upon the tendered documents, including a transcript of the proceedings before each Magistrate, in stating what appears below. It will be necessary to state some of the evidence given by the first Plaintiff later in these reasons.
The Defendant claimed the following relief in the Statement of Claim which he filed in November 2011:
"As against the First Defendant:
1. Damages $37,749.00;
2. Interest pursuant to section 100 of the Civil Procedure Act;
3. Costs.
As against the Second Defendant:
1. Damages
a. $37,364.80;
b. Or alternatively, in the event where no order is made against the First Defendant; $75,213.80;
2. Interest pursuant to the written agreement dated 1 February 2010 at the rate of $10% per annum;
3. Costs."
The Defendant asserted that, pursuant to a written agreement, the first Plaintiff had agreed to pay for professional services provided by him to her. He asserted that he had rendered nine tax invoices; that he had requested payment of each of them; that the first Plaintiff had only paid $600 on account of the fees claimed, and that she had either neglected, or refused, to pay the balance of the amount of fees outstanding.
As against the second Plaintiff, the Defendant asserted a written agreement of a different date, pursuant to which the second Plaintiff had agreed to pay for the professional services provided by the Defendant and had agreed to "accept full financial responsibility for all psychological services, such as therapy, visits and reports provided ... in relation to the issues with Department of Community Services and NSW Health involving [the child]".
The Defendant also referred to what were said to be express terms of the written agreement and identified amounts for services that he claimed had not been paid. He asserted that he had requested payment of each amount and that the second Plaintiff had either neglected, or refused, to pay the amount of fees outstanding.
It is to be noted that the Statement of Claim was not verified.
The Defendant also filed a signed Statement, apparently dated 2 March 2012, comprising 76 paragraphs and about 300 pages of annexed documents (which formed part of Ex. RW1). There was no evidence before the Magistrate concerning when, or if, the signed Statement had been served upon the Defendants, but, at the hearing before me, they agreed it had been served in about "mid-March". (Paragraph 3 of the first annexure to Local Court Practice Note Civ 1 requires that evidence be served at least 4 weeks before the hearing.)
As stated earlier, the Plaintiffs each filed a Defence in early January 2012. It is not necessary to go into exquisite detail about the complaints made by the Plaintiffs in the Defence that each filed in the Local Court proceedings, about the work done and services alleged to have been provided by the Defendant. In broad terms, they alleged that he was not properly qualified and should not have held himself out as being so qualified; that he had not provided professional psychological services; that any services that he did provide were unnecessary; and they denied having any valid agreement with him. They also claimed that he had been paid for some of the work, which payments he had not taken into account in calculating the amount of the claims that he made.
It is noteworthy that there has been no submission, made on behalf of the Defendant, at any time since the commencement of the proceedings in this Court, that the Defence filed by each Plaintiff in the Local Court proceedings, was not a bona fide, or arguable, defence.
As stated, the Plaintiffs had also filed a notice of motion seeking, amongst other things, pursuant to Uniform Civil Procedure Rules ("UCPR") rule 14.28, that the Statement of Claim be struck out. In support, there was an affidavit sworn 18 March 2012, the original of which was filed on 23 March 2012. Again, there is no evidence of the date of service of the affidavit, but I infer it was on or after 18 March 2012.
I turn, now, to what occurred in the Local Court on 29 March 2012. When the matter came before Magistrate Viney, at about 10:00 a.m., Mr Bolster confirmed "[i]t is ready to proceed". He added:
"There is a motion on foot... which may mean that the matter would not proceed but it's really a matter about evidence rather than an adjournment. I don't think it will take 5 hours. I think it's probably a 2 to 2.5 hour matter."
After the learned Magistrate raised the question of the Statement of Facts and Issues, and the fact that she would be unable to hear the matter, the following passage appears in the transcript:
"There are four hearing courts sitting in this complex today...If something happens and there is an available spot then you will move to that magistrate. I would urge you to be able to stay within hearing distance of your name being called if your matter is going. If you are not here and your matter is transferred to another court it may be heard in your absence. Do you understand that?
Defendant R Maytom: Yes.
Her Honour: ...So we will stand you in the list and if you need to depart for any length of time if you could let my court officer know and make sure that she has available mobile telephone numbers for you because as I said if your name is called and you are not [there] they will be dealt with."
The Plaintiffs appeared to have complied with her Honour's request to provide a mobile telephone number, although this is not clear from the transcript. However, there is a contemporaneous NSW Courts Service Centre document, which reveals that, at 10:56 a.m., a telephone call was received from the second Plaintiff. That documents also records:
"Case No. ... matter adj for a while this morning. New contact number needed to be give [sic] to Clerk or Associate in court plz.
Description of enquiry and/or information provided by client: Patricia Maytom rang this morning at 10:50 am. Her case has adjourned for a while and she gave the Clerk in Court a contact number so they could be notified of when to return. That number is currently not working. She has asked that we send the following number thru to be used for this purpose. [Bolded telephone number]".
A little after midday, the matter was transferred to the List of Magistrate Van Zuylen. The following passage appears in the transcript:
"HIS HONOUR: I note there's a civil matter here. Solicitors are here. Unfortunately I haven't got the papers. I just wanted to confirm that everything is tendered with all documents on the court file?
BOLSTER: There is an issue. Unrepresented litigants are the defendants. They haven't been here since 10 when the matter was called before her Honour Viney. My name is Bolster by the way.
HIS HONOUR: Thank you Mr Bolster.
BOLSTER: Your Honour we've been round the court and we haven't seen them since 10. They weren't back before her Honour at 12 when the matter was re-mentioned and her Honour mentioned your Honour might be providing assistance. It's not straight forward in terms of the evidence. There was some late service of evidence from the defendants. There will be objections about that.
HIS HONOUR: All right but they're not here to prosecute their case. Well I need those papers. I'll deal with it at 2 o'clock. I'll give them that chance. I'll get the papers, I'll look at the papers over the lunch adjournment and then I'll deal with it as soon as I can after 2 and call it on. Thank you, you're excused till then, thank you Mr Bolster."
When the matter was called again, Magistrate Van Zuylen stated: "Now I have looked at the paperwork". The Plaintiffs were then "officially called". Mr Bolster acknowledged that he was "aware of the communication from one of the [Plaintiffs] to the Court", which I infer was the document forwarded by facsimile transmission to which I have earlier referred.
The following passage then appears in the Transcript:
"COURT OFFICER: There's no appearance of Rachel and Pamela Maytom.
HIS HONOUR: Yes they are called at 3.20. They have not been around although there is a message from the court officer to say 'spoke to Ms Maytom and asked what she's having done now. She's going to send to the court NOM', which I gather is Notice of Motion, 'in writing to transfer matter to another court'. The court has received nothing more than that. So yes I propose to give judgment in favour of the plaintiff.
BOLSTER: Could I indicate to your Honour we have done some calculations in the amounts.
HIS HONOUR: Yes what are you seeking in regard to judgment?
BOLSTER: In the case of the first defendant the evidence, there is one invoice that is not capable of being sustained. So we're reducing the figure to $35,540.20 which is some of the invoices that are particularised in paragraph 6 less invoice number 9. That's for the first defendant.
Interest on that amount from the date of the last invoice, so we've forgone interest prior to that, to today--
HIS HONOUR: Plus interest.
BOLSTER: --we calculate that as 555--
HIS HONOUR: I don't calculate the interest. I just leave that for the - I'll say plus interest from what date are you seeking?
BOLSTER: -- 6 September 2010.
HIS HONOUR: Yes because it's going to keep mounting so I wont' fix a sum. Plus interest from 6 September 2010.
BOLSTER: In the case of the second defendant the amount claimed is $68,805.
HIS HONOUR: Second defendant $68,805.
BOLSTER: Which I should indicate to your Honour it's the sum of the amounts referrable to the first defendant and the second defendant and there's evidence that the second defendant signed essentially a guarantee to pay the amounts [f]or both... mother and daughter. And so that's $68,805.00. There is some ambiguity I should say to your Honour in the prayers for relief about the alternative way in which that's claimed. But certainly in the pleading it's pleaded... at paragraph 12 that the second defendant accepted responsibility for all services provided for both herself and the first defendant and I could take your Honour to the document where she's--
HIS HONOUR: No I accept what you're saying. What date do you want interest to commence from?
BOLSTER: The same date your Honour.
HIS HONOUR: From 6 September 2010 plus costs as agreed or assessed."
I should note that at the hearing before me, counsel for the Defendant accepted:
"There seems to have been an error or there is an error in the way those orders have been entered, particularly given how the statement of claim was granted, but Mr Kennett never sought to take advantage of that error and proceeded on the basis that the judgments had been entered in the alternative".
The following passage then occurred during submissions:
"HIS HONOUR: ...If you accept that there was an error in giving judgment for the amount why doesn't that automatically result in the judgment at least as against the second defendant Mrs Maytom being set aside?
STEIRN: Because I submit if your Honour was to review the material before Magistrate van Zuylen and based on the failure of the defendants to appear, I submit Magistrate van Zuylen could only have proceeded in that to give effect to those orders. So whilst Magistrate van Zuylen may have got the figures wrong broadly speaking or how that was divvied up, the way that the claim was framed and on the material before his Honour any other result is not possible I submit."
It is not in dispute that, prior to entering judgment, the learned Magistrate was not informed of the Plaintiffs' notice of motion, or that it had been listed, for hearing, on that day.
Also, he was not made aware of a facsimile transmission sent by the Plaintiffs. This is clear from the following passage in the transcript:
"HIS HONOUR: Mr Bolster has gone hasn't he?
SPEAKER: Yes
HIS HONOUR: I will just put this on tape. It has come to my attention that at the back of the court papers after finalising the civil case of Kennett v Maytom where I granted judgment in favour of the plaintiff plus costs and I did refer to a message being received as to a Notice of Motion, it has now come to my attention that a fax urgent handwritten fax saying "both defendants give notice that a summons is being filed at the Supreme Court of New South Wales to move the proceedings to the Supreme Court. We respectfully require an adjournment with a Notice of Motion as filed."
What I note is that there has been no attendance by the defendants in present in court to prosecute that application and the court did refer to the note from the court officer that it was their intention to file a Notice of Motion to move it to the Supreme Court. The motion is struck through no appearance of the applicants even though they were here at 10 o'clock in the morning, struck out or dismissed. I am doing this in the absence of Mr Bolster who has gone. I did not realise that the application had been before me. But I am striking out the motion. I am not prepared to deal with it by way of a handwritten fax at 2.27 when their matter was listed for hearing and they have absented themselves from the local court.
I direct that a copy of my decision be sent to Mr Bolster, the solicitor for the plaintiff, so that he is aware of what has happened in his absence."
The document referred to in the passage quoted is a facsimile transmission, addressed to the Parramatta Local Court, apparently sent from Sydney, at 2:27 p.m., on 29 March 2012, for the attention of Magistrate Van Zuylen, marked "URGENT", apparently signed by each of the Plaintiffs, which stated:
"Both defendants gives notice that a Summons is being filed at the Supreme Court of N.S.W. to move the proceedings to the Supreme Court.
We respectfully require an adjournment until a Notice of Motion is filed in the next few days at Parramatta Court."
What had prompted Magistrate Van Zuylen to refer to this document after, but not before he gave judgment, particularly as he appears to have raised its receipt with Mr Bolster, and not until well after the matter had been dealt with and Mr Bolster had left, remains unexplained.
Thus, the decision of the learned Magistrate in granting judgment and, so it would seem, dismissing the Plaintiffs' notice of motion for summary dismissal, was dispositive of the whole of the proceedings.
(It is not necessary to say anything about the order made pursuant to the provisions of the Children and Young Persons (Care and Protection) Act 1998, by the learned Magistrate, as it is in the interests of justice that information tending to reveal the identity of the child involved in the care proceedings not be published. The Plaintiffs made no oral submission to the contrary. The precise identity of the child is not central to the disposition of these proceedings. Accordingly, I propose to make that order in any event.)
The evidence given at the Hearing in this Court
The first Plaintiff gave evidence that she provided her mobile telephone number to the Clerk of the Court; that she and her mother left the Court; and, when they had not heard from anybody, her mother called the Court and gave her own mobile telephone number. Subsequently, they did not receive any telephone calls on that telephone number.
There are two aspects of the first Plaintiff's evidence that require comment. When she gave evidence before me on 4 February 2014, she said:
"Q. Where did you send the fax from?
A. We sent it from the Convenience Shop, um, shop which was directly across the road from, um, the main law courts building in the city here.
STEIRN: In the city?
A. Oh, here. Sydney. Sydney City.
STEIRN: Sorry, not Parramatta?
A. No."
During cross-examination by counsel for the Defendant, she said that she and the second Plaintiff had signed the original document, whilst they were at Parramatta, and that it was her father who had come to the City of Sydney and sent it, by facsimile transmission, to the Parramatta Local Court. The handwriting on that document, other than the signature of the first Plaintiff, was that of the second Plaintiff. It had been written, and signed, whilst they were at, or near, the Local Court. She said that she and the second Plaintiff, thereafter, "had remained in the Parramatta area".
The first Plaintiff was unable to explain why the facsimile transmission had been sent from the City of Sydney when she and the second Plaintiff had remained in the Parramatta area. She was also unable to explain why neither she nor the second Plaintiff had sent it, but rather left it to her father to do so.
More importantly, however, she was unable to explain how the reference to Magistrate Van Zuylen appeared on that document if neither she, nor the second Plaintiff, had been contacted by someone from the Local Court at any time after they left the Court precincts.
She suggested that the second Plaintiff may have been informed that the matter had been transferred to Magistrate Van Zuylen at the time the second Plaintiff had spoken to the Call Centre to provide the new contact telephone number. This seems somewhat unlikely because there is no evidence that the matter had been transferred to Magistrate Van Zuylen prior to 10:57 a.m., being the time when the second Plaintiff was recorded as having made the telephone call to the Call Centre.
Other evidence reveals that the matter was first mentioned before Magistrate Van Zuylen at about noon.
Mr Bolster's affidavit was sworn on 5 November 2013. He deposed to the following matters:
"6. Prior to calling through the list, Magistrate Viney stated the following:
"Unfortunately the list is very busy today and some matters may not get on. I will not be sending parties in the other matters away before at least midday. If you are local, please leave a contact number with the Court so that you can be called should the situation change. Otherwise, you should remain within the precincts of the Court. I should warn you that if you are not present when your mater is called it may be dealt with in your absence. I will re-visit the state of the list following the morning-tea adjournment.
...
13. At approximately 2pm I returned to Magistrate Van Zuylen's Court. While we waited for Mr Kennett's matter to be called his Honour's Associate approached me and we had the following conversation:
Assoc: We have received a phone message from... Rachel and Pamela Maytom saying that the number they had left to be contacted on was not working and provided another number. They also said they were going to prepare a notice of motion to transfer the mater to another court.
PB: I understand. We shall see what happens."
14. At approximately 2.30pm His Honour's Associate called the Maytoms again. I was not present when that call took place.
15. Immediately following that phone call, I had a phone conversation with His Honour's Associate outside of the Court in which she said to me words to the following effect:
Assoc: Rachel Maytom has just told me that they will not be coming to Court this afternoon."
The evidence of Mr Bolster was not objected to. He readily conceded, during cross-examination that he had not been present during the telephone call with the first Plaintiff referred to by the Associate. However, as it was hearsay evidence, the question is its probative value.
The Legislation
Under s 39 of the Local Court Act 2007 (NSW), a party has a right to appeal to this Court on a question of law. An appeal that involves a question of mixed law and fact, or which concerns an interlocutory judgment or order, or an order as to costs, may only be pursued with leave of this Court (s 40).
Section 41(1) of the Local Court Act provides:
"The Supreme Court may determine an appeal made under section 39(1) or 40:
(a) by varying the terms of the judgment or order, or
(b) by setting aside the judgment or order, or
(c) by setting aside the judgment or order and remitting the matter to the Local Court for determination in accordance with the Supreme Court's directions, or
(d) by dismissing the appeal."
One issue that arises regards whether the Plaintiffs' appeal, in whole or in part, is an appeal as of right, or whether, to the extent that it is not, leave to appeal should be granted.
(During submissions, the first Plaintiff sought an order that, in the event the appeal were allowed, that the matter should remain in this Court. Counsel for the Defendant submitted that, even if the appeal were allowed, and the judgments were set aside, the substantive proceedings would have to be heard in the Local Court. In view of s 41(1), I accept the Defendant's submission.)
Any appeal to the Supreme Court is by way of re-hearing. On any such re-hearing, the Court may receive further evidence but only on special grounds: s 75A Supreme Court Act1970 (NSW). No application was made in the present proceedings to receive further evidence.
The Local Court Act does not refer to the time within which an appeal should be lodged. However, UCPR rule 50.3 relevantly provides that a summons commencing an appeal must be filed within 28 days after the material date or within such further time as the higher court may allow. Any application for an extension of time must be included in the summons commencing the appeal. A similar rule (UCPR rule 50.12), applies in respect of a summons seeking leave to appeal.
The term "material date" is defined in UCPR rule 50.2(1) to mean:
"(a) if the appeal is from the decision of a court, the date on which the decision is pronounced or given, and
(b) if the appeal is from any other person or body, the date on which notice of the decision was given, by or on behalf of the person or body who made the decision, to the person who wishes to appeal."
The term "decision" is defined in the same rule as including:
"a judgment, order, opinion, direction or determination."
Relevant Legal Principles
The relevant principles to be applied when deciding whether to extend time for lodging an appeal, or an application for leave to appeal, have been set out in Gallo v Dawson [1990] HCA 30; (1990) 93 ALR 479. That case makes clear that the granting of leave is not automatic but involves the exercise of discretion. There are no statutory criteria that must be taken into account. There are no rigid, or exhaustive, rules in regard to the exercise of the discretion, which is broad and flexible. It is "unfettered (in the sense that there is no legislative prescription on its exercise), it is a judicial discretion that (like the discretion to extend time for the service of a writ, or to extend time to commence proceedings outside a statutory limitation period), is not at large": In the matter of Pan Pharmaceuticals Ltd (in liq) - Brennan v McGrath [2011] NSWSC 561, per Ward J (as her Honour then was), at [4].
The discretion is given for the obvious purpose of enabling the court to meet the overall interests of justice. Without intending to be exhaustive, when exercising the discretion, the court will have regard to the nature and history of the proceedings, the conduct of the parties, the nature of the litigation, the length of the delay, the reasons for the delay, whether the delay was intentional, or contumelious, or merely the result of a bona fide mistake or blunder, the proposed grounds of appeal, whether the appeal is arguable, the consequences to the parties of the grant, or refusal, of the extension of time, and the extent of the prejudice, if any, suffered as a result of the delay, by the intended respondent to the appeal. (In setting out these factors, I bear in mind that although they are referred to in the cases, they should not confine the broad discretion given to the court.)
It goes without saying that the rules of court must, prima facie, be obeyed, and that, in order to justify an extension of time, there must be some material upon which the court can exercise its discretion. Also, I have not forgotten what was written by Siopis J in 3D Funtimes Ltd v Intellec Development Group Pty Ltd (No 2) [2011] FCA 407, at [19], (albeit that, in the present case, there was not an order of the court):
"It is unsatisfactory that a delinquent party can...simply ignore the orders of the Court made for the purposes of the fair and efficient hearing of Court proceedings; and then, seek to rely upon its own non-attendance at the hearing of the application, to set aside the orders made in the delinquent party's absence."
In Gallo v Dawson, McHugh J also noted:
"It is also necessary to bear in mind in such an application that, upon the expiry of the time for appealing, the respondent has "a vested right to retain the judgment" unless the application is granted: Vilenius v Heinegar (1962) 36 ALJR 200 at 201. It follows that, before the applicant can succeed in this application, there must be material upon which I can be satisfied that to refuse the application would constitute an injustice."
However, in Outboard Marine Australia Pty Ltd v Byrnes [1974] 1 NSWLR 27, at 30, the Court of Appeal (Reynolds, Hutley and Bowen JJA) held that "where genuine issues ought to be litigated, if such can be done with fairness to all concerned, it is appropriate to take a benign view of applications to extend time".
On the question whether leave to appeal should be granted, I should also refer to Department of Premier and Cabinet v Hulls [1999] VSCA 117; [1999] 3 VR 331, in which JD Phillips JA, at 335 [10], 336 [12]-[13], 336-7 [15], observed:
"On an application for leave to appeal it cannot be expected that error below be established: that is for the appeal itself. Something less must be sufficient on the application for leave to appeal and ordinarily the applicant will be required to show that there is a real or significant argument to be put that error exists. In other contexts, this has sometimes been called "a prima facie case", or "an arguable case", but these are no more than attempts to describe the degree to which an applicant must satisfy the court from which leave is sought that there is a real or significant argument, in favour of the applicant, on the question of law which is identified. (Contrast in a different context Beecham Group Ltd. v. Bristol Laboratories Pty. Ltd. [1968] HCA 1; (1968) 118 C.L.R. 618 at 620, per Kitto J.) It is not possible to lay down in advance any standard of satisfaction, for much may depend upon the importance of the question of law to the remedy to be sought. What is peripheral may be thought less persuasive, in relation to leave to appeal, than an issue which is central.
...
... For myself, I am attracted by the proposition articulated in Niemann, that the decision below should be "attended by sufficient doubt to justify the grant of leave to appeal". That seems to me to leave open what is "sufficient", while at the same time confirming that there must be doubt "sufficient ... to justify the grant of leave". Beyond that it is difficult to be more precise ...
Once a question of law has been identified which bears directly upon the relief which will be sought on the appeal, and once it has been shown that there is sufficient doubt attending that question to justify the grant of leave to appeal, it may be supposed that leave will ordinarily go if the order below is a final order. That must always be subject to its being just to grant leave, a consideration which will in some cases be determinative. It directs attention to the position of the parties - and perhaps third parties if directly affected by the order below or the proposed appeal - and perhaps the simplest example arises when the order below is plainly interlocutory.
...
Where the order which is under challenge is final, the injustice of allowing the determination below to stand uncorrected, if indeed it is attended by error, will be more readily discerned. It will be apparent, at least in many cases, that to leave a final order standing which would be reversed if error of law were established is unjust to the party adversely affected by the order: the prejudice lies in that party's being bound to comply with an order that ought not to have been made as a matter of law... What was said in Niemann might then still be a useful guideline under s. 148, whether the order below be final or interlocutory - provided it is recognised that the injustice attending an order's continuing to stand is probably more readily discernible if it is final rather than interlocutory...."
In this case, the Defendant submits that the Plaintiffs have not explained their delay in filing the notice of appeal. Whilst that is, of course, a relevant matter if established, the absence of a sufficient reason for the procedural default does not necessarily mean that their application for an extension of time to appeal must fail.
In Asuzu v Council of the New South Wales Bar Association [2012] NSWCA 406, Ward JA wrote, at [42]:
"An application for leave to extend time must be assessed having regard to what the interests of justice require in all the circumstances of the case. Relevant factors include the reason why the appeal was not lodged in time; the period for which an extension is sought; any prejudice to the opposing party; and the apparent prospects of success on the appeal. In Tomko v Palasty (No 2) [2007] NSWCA 369, Basten JA considered (at [58]) that it would generally be sufficient for the applicant to demonstrate a fairly arguable case (at least assuming there is a reasonable explanation for the delay and no significant prejudice to the opposing party). (It may be necessary to show more than fairly arguable prospects of success in circumstances where there is no, or no satisfactory, explanation for the delay or where there is prejudice to the opposing party.)"
McColl JA in Chand v RailCorp [2010] NSWCA 233, at [36] observed:
"In Bi v Mourad [2010] NSWCA 17, Allsop P emphasised (at [47]) that while delay is a feature of litigation intended to be eliminated as far as possible by the statutory enactment of the regime in the Civil Procedure Act..., nevertheless any application of this nature requires careful attention to the Civil Procedure Act and, without being unduly repetitive, I hope, to the requirement that applications be considered in the light of the dictates of justice."
The burden of demonstrating that the time should be extended and/or that leave should be granted, lies on the applicant for leave to appeal or to appeal: Larsen v Vile [1999] NSWCA 397; Gorczynski v AWM Dickinson & Son [2005] NSWSC 277 at [14]; Dunn v McCarthy QC [2007] NSWSC 1336, at [6]. Relevantly to this case, it is necessary for the Plaintiffs to show error in procedure in order to engage the jurisdiction of the Court to make any orders: Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172; Fox v Percy [2003] HCA 22; (2003) 214 CLR 118.
In this case, it is clear that the learned Magistrate proceeded in the absence of the Plaintiffs. In Commissioner for ACT Revenue v Alpha One Pty Ltd (1994) 49 FCR 576, the full court of the Federal Court, Northrop, Miles and French JJ noted (at 590):
"It is a fundamental principle that where the rules of procedural fairness apply to a decision-making process, the party liable to be directly affected by the decision is to be given the opportunity of being heard. That would ordinarily require the party affected to be given the opportunity of ascertaining the relevant issues and to be informed of the nature and content of adverse material...The subject is entitled to respond to any adverse conclusion drawn by the decision maker on material supplied by, or known to, the subject which is not an obvious and natural evaluation of that material. The decision maker is required to advise of any adverse conclusion which has been arrived at which would not obviously be open on the known material".
In He v Hecker [2013] NSWSC 1219, Harrison AsJ observed, at [28], in relation to an appeal from a Magistrate:
"...his Honour was obliged to afford both parties procedural fairness. It is trite law that the requirements of procedural fairness apply to the Local Court. The contents of the requirements of natural justice or procedural fairness are not fixed but they involve a duty to act judicially, deal with the matter for decision without bias, give each party the opportunity of adequately presenting its case, observe the procedural and other rules provided for in the relevant statute and come to its decision with that sense of responsibility that is the necessary accompaniment of the duty to do justice. See Wakim v Mathiew Pty Ltd t/as Dove Migration Services [2002] NSWSC 405."
It should not be forgotten that:
"A decision by a court to grant or refuse an adjournment is a procedural decision made in the exercise of a discretion vested in that court. It is therefore a decision which is ordinarily best left to the court seized of the proceedings, and one which will not lightly be set aside on appeal, or review. The court considering an application for an adjournment is entitled to take into account the need to avoid disruptions in the court's lists (with consequent inconvenience to the court and prejudice to the interests of other litigants waiting to be heard) and these considerations are within the knowledge of the court making the decision. An appeal court will generally only interfere with a decision to grant or refuse an adjournment if the discretion has not been exercised judicially or where its exercise was based upon the wrong principle or resulted in gross injustice."
See: Teague v Chin; Teague v Chin [2013] NTSC 72, at [27].
Yet, it is necessary for the court to consider the application and decide it. In that regard, consideration could be given to whether the matter had been adjourned before; whether it could be completed and, if not, would there be any advantage to commencing it and having it adjourned part heard; the service of evidence; the effect upon both parties if the application for adjournment was refused; whether there was a bona fide defence and/or cross-claim which should be allowed to proceed.
A denial of natural justice is an error of law: Escobar v Spindaleri (1986) 7 NSWLR 51.
Another issue raised by the Plaintiffs is the lack of procedural fairness in Magistrate Van Zuylen failing to provide any reasons for each of his decisions. Included within this submission, is his failure to identify the documents in support of the Defendant's case upon which he relied to give judgment.
In Mifsud v Campbell (1991) 21 NSWLR 725, Samuels JA, at [728] said:
"... it is an incident of judicial duty for the judge to consider all the evidence in the case. It is plainly unnecessary for a judge to refer to all the evidence led in the proceedings or to indicate which of it is accepted or rejected. The extent of the duty to record evidence given and findings made depend, as the duty to give reasons does, upon the circumstances of the individual case.
Accordingly, a failure to refer to some of the evidence does not necessarily, whenever it occurs, indicate that the judge had failed to discharge the duty which rests upon him or her. However, for a judge to ignore evidence critical to an issue in a case and contrary to an assertion of fact made by one party and accepted by the judge... may promote a sense of grievance in the adversary and create a litigant who is not only "disappointed" but "disturbed" - to use the words which appear in the New Zealand case of Connell v Auckland City Council [1977] 1 NZLR 630 at 634. It tends to deny both the facts and the appearance of justice having been done. If it does, as in my opinion is the case here, then it will have worked a miscarriage of justice and have produced a mis-trial and resulted in what I would take to be an error of law which is reviewable on appeal. Whether it is an error of law or an error of fact, it seems to me a failure by the judge to do what the nature of the office requires."
In Stoker v Adecco Gemvale Constructions Pty Ltd [2004] NSWCA 449, Santow JA (Mason P and Sheller JA agreeing) observed, at [41], after referring to a number of authorities, that the failure to give adequate reasons may be an error of law. His Honour referred to Beale v Government Insurance Office of New South Wales (1997) 48 NSLWR 430, in which Meagher JA (at 444) had observed that, in most cases where the provision of inadequate reasons is asserted as constituting an error, it is assumed that such an error is an error of law.
The judicial obligation to provide reasons was also considered in Young v Cesta-Incani [2007] NSWCA 229, at [54], where Tobias JA (with whom Hoeben and Ipp JJA agreed) cited with approval what had been said in Wiki v Atlantis Relocations (NSW) Pty Ltd [2004] NSWCA 174; [2004] 60 NSWLR 127:
"The proper administration of justice requires reasons to be given in a form, firstly, that will enable the losing party to understand properly the grounds upon which the case was lost, and, secondly, that will not, effectively, frustrate the losing party's right to appeal."
In Getex Pty Ltd v Reed Business Information Pty Ltd [2013] NSWSC 1161, Bellew J wrote:
"The duty to give reasons is a necessary incident of the judicial process (see Stoker (supra) at [41] per Santow JA). In that case Santow JA also said (at [41]):
"It is sufficient if the reasons adequately reveal the basis of the decision, expressing the specific findings that are critical to the determination of the proceedings."
In Beale (supra) Meagher JA said (at 442):
"A failure to provide sufficient reasons can, and often does, lead to a real sense of grievance that a party does not know or understand why the decision was made: Re Poyser and Mills' Arbitration [1964] 2 QB 467 at 478. This court has previously accepted the proposition that a judge is bound to expose his reasoning in sufficient detail to enable a losing party to understand why it lost."
His Honour went on to observe (at 442 - 443) that whilst a statement of reasons need not necessarily be lengthy or elaborate, an adequate statement of reasons will:
(i) refer to all relevant evidence;
(ii) set out any material findings of fact and any conclusions reached; and
(iii) provide reasons for making the relevant findings of fact, and reaching the relevant conclusions, as well as provide reasons in applying the law to the facts found.
Similar observations were made in Pollard v RRR Corporation Pty Limited [2009] NSWCA 110 at [56] and following. They were subsequently confirmed and summarised by Sackville AJA (Campbell JA and Bergin CJ in Eq agreeing) in Qushair v Raffoul [2009] NSWCA 329 at [52] and following. Amongst the principles summarised by Sackville AJA in Qushair were the following:
(i) although lengthy and elaborate reasons are not required, a trial judge must, as a minimum, provide reasons which are adequate for the exercise of a facility to appeal, where such facility is available;
(ii) whilst the extent of the reasons will depend upon the particular case and the issues under consideration, it is essential that the reasoning of the trial judge on a point which is critical to the contest between the parties be exposed;
(iii) the requirement in (ii) above may require the trial judge to refer to evidence which is critical to the proper determination of the issues in dispute;
(iv) where credit issues are involved, it is necessary to explain why it is that the evidence of a witness is accepted or rejected."
Application of Principles
The Plaintiffs submit that their appeal involves only questions of law and that no leave to appeal is necessary.
Counsel for the Defendant put the matter this way:
"6. It is the Defendant's position that LCM Van Zulyen's orders constitute 2 appealable limbs:
(i) whether the interlocutory decision to proceed with the matter in the Maytoms' absence in the circumstances was appropriate; and
(ii) whether the decision to enter judgment in favour of Kennett on the material before the Court was appropriate."
He then submitted that Magistrate Van Zuylen's preliminary decision to proceed with the matter in the absence of the Plaintiffs was an interlocutory decision and that to appeal from such a decision required the leave of the Supreme Court.
An exercise of discretion, usually, would not solely involve a question of law, and an appeal from such a decision would not raise, solely, a question of law. Similarly, whilst a denial of procedural fairness would, generally, involve a question of law, more often, it involves a question of mixed law and fact, because it depends upon an analysis of the proceedings. However, as stated, a failure to give adequate reasons is an error of law.
I am satisfied, to the extent that the Plaintiffs' appeal, on any aspect, involves other than an error of law (which it must because they appeal the costs orders made) that leave should be granted. That it should be granted was not really the subject of any dispute by counsel for the Defendant.
There is no dispute that the Plaintiffs filed their Summons well out of time (some 7 months). It is put, on behalf of the Defendant, that "no affidavit explaining the delay in bringing the appeal has been provided by the Plaintiffs" and that "they should not be granted an extension of time to appeal on this basis alone".
Whilst there is no specific evidence explaining the delay in filing the Summons, I note that the Plaintiffs, at all times, have been unrepresented. Furthermore, in the period between April and November 2012, they appear to have been dealing with the application, by the Defendant, to adjudicate each of them bankrupt.
I note that, other than in respect of costs, the Defendant has not referred to any prejudice he has suffered that has been caused by the delay. Most importantly, he has not asserted that the Plaintiffs did not have an arguable defence or that all of the grounds of the appeal are hopeless. The Defendant submitted only "leave should not be granted as the appeal is unmeritorious and the Defendant has suffered prejudice as he has been denied the enjoyment of the Local Court judgment entered in his favour in March 2012".
As the Defendant did not file any evidence in this case as to any other prejudice, it is difficult to see how that submission can be accepted, except in respect of costs, the incurring of some of which one would expect. I have not forgotten his legitimate interest in the timely determination of the proceedings.
However, I note that Bergin CJ in Eq, described the application as one raising "a serious question to be tried about the way in which judgment was entered". With respect, that was an apt description. Costs since then have been incurred in defending the Plaintiffs' claims in the appeal.
I must also consider the prejudice to the Plaintiffs if time is not extended. In that regard, each will be faced with a final judgment and applications to make her bankrupt. There has been no decision on the merits. Furthermore, there are genuine issues to be litigated warranting "benign consideration" of the application for an extension of time.
In all of the circumstances, in the exercise of my discretion, I am prepared to grant the extension of time to lodge the summons commencing the appeal, or to the extent necessary, to lodge the summons seeking leave to commence the appeal.
I then turn to the appeal itself. In my view, there are a number of reasons why the appeal should be allowed.
There is no evidence that enables me to conclude that the learned Magistrate gave any consideration to the Plaintiffs' application for an adjournment, albeit that it was made in correspondence, prior to the determination of the substantive claim for relief.
The failure to consider, and deal with, the application for an adjournment made by the Plaintiffs, notwithstanding that they were not present to make the application in person, in circumstances where, had they been present, the matter could not have been concluded, in my view, demonstrates an error of law. His Honour does not appear to have considered, sufficiently, or at all, the practical effect of not granting an adjournment when, in any event, the matter would not have been able to be concluded. Nor, it would appear, did he consider the other matters to which I have referred above.
Nor was there any apparent consideration of their application for summary dismissal. Clearly, Mr Bolster appreciated that the notice of motion should be dealt with first. He had raised it with Magistrate Viney. He did not raise it before Magistrate Van Zuylen.
Furthermore, there is no transcript of, or reference to, the "paperwork" that the learned Magistrate had "looked at". In fact, at the time the matter was before the learned Magistrate, the transcript does not reveal that any evidence had been tendered. Virtually nothing had been said about the substantive proceedings and the nature of the documents to be relied upon by either party. The question posed by the learned Magistrate to Mr Bolster regarding documents having been tendered appears to have not been answered.
As earlier stated, there had been no identification of the documents upon which the Defendant sought to rely prior to the learned Magistrate stating that he had "looked at the paperwork".
Also, the only document by the Defendant was a signed, but unsworn, statement that had been filed, to which I have referred. (In this regard, Mr Bolster appears to have referred to the late service of the Defendants' evidence, but not to the apparent late service of the Plaintiffs' evidence.) There is nothing in the Transcript to suggest that this document had been tendered.
Furthermore, if the learned Magistrate did look at the Defendant's statement, there was no evidence to show that it had been served on the Plaintiffs, or if it had been, when it had been served. For example, if it had been served after the date the statement bore, the Plaintiffs may have had a basis for seeking an adjournment since it had not been served in accordance with the rules.
In any event, it was not sufficient, in my view, to "look at" documents, without identifying those documents. Nor was it sufficient to assume that he should do so merely because the Plaintiffs were not present when the matter was called and fail to identify them. The parties, then, or subsequently, were entitled to know precisely what had been considered before reaching a decision.
Nor is there any suggestion that the Magistrate struck out either of the defences that had been filed because the Plaintiffs were not in Court when he was dealing with the matter. The defence in each case, was, or ought to have been, before the Magistrate at the time of the hearing and, as noted above, it raised a specific issue as to quantum of the amounts claimed, and asserted that the Defendant had received other moneys that he had not taken into account in determining the amount that he claimed.
One does not know whether the learned Magistrate "looked at" or considered the Defence filed. If he did, he should have addressed the principal contested issues joined between the parties. The Defendant had not suggested that the defences were not bona fide defences.
Nor is there any transcript of the reasons for the judgments given against each Plaintiff. There is nothing to suggest whether the learned Magistrate considered the distinction between "debt" and "damages". Nor does it appear that the learned Magistrate referred to UCPR rule 16.6 or 16.7, which relate to default judgment on a claim for liquidated damages or unliquidated damages.
It is not in dispute that the amount of the judgment against the second Plaintiff was in error bearing in mind the terms of the relief that the Defendant had sought against her. Even if it was not necessary to give detailed reasons as to why he accepted the Defendant's evidence, the learned Magistrate was at least required to express "the essential ground or grounds" for his conclusion that the Defendant was entitled to judgment against each of the Plaintiffs and how the amount of the judgment had been calculated.
The application determined by the learned Magistrate on 29 March 2012 required consideration of what precisely the Defendant's claims were and whether there was a factual basis for each claim. It also required a consideration of whether the defence by each Plaintiff was an arguable one and whether the matter should be determined in her absence.
A further matter that is relevant is that the award of interest was made on the basis of interest running from the date identified by Mr Bolster. The determination of the question whether interest should be paid, and from when, involved a discretionary determination. No opportunity had been provided for the Plaintiffs to be heard on the appropriate order for interest.
Finally, there is no suggestion in the transcript that the Magistrate directed that a copy of the decision should be sent to the Plaintiffs. (It is apparent, however, that they have received a copy of the transcript of the proceedings.)
It may be that, in proceeding in the way he had, Magistrate Van Zuylen had in mind s 56 of the Civil Procedure Act2005 (NSW) and the overriding purpose of the Act and of the rules of court, in their application to civil proceedings, to facilitate the just, quick and cheap resolution of the real issues in the proceedings. He may also have had in mind the objects identified in s 57 of the Civil Procedure Act, being the efficient disposal of the business of the court, the efficient use of available judicial and administrative resources, and the timely disposal of the proceedings, and all other proceedings in the court, at a cost affordable by the respective parties.
Yet, it must be remembered that, in s 58(1), it is made clear that the Court must seek to act "in accordance with the dictates of justice". Section 58(2) then gives content to this phrase:
"For the purpose of determining what are the dictates of justice in a particular case, the court:
(a) must have regard to the provisions of sections 56 and 57, and
(b) may have regard to the following matters to the extent to which it considers them relevant:
(i) the degree of difficulty or complexity to which the issues in the proceedings give rise,
(ii) the degree of expedition with which the respective parties have approached the proceedings, including the degree to which they have been timely in their interlocutory activities,
(iii) the degree to which any lack of expedition in approaching the proceedings has arisen from circumstances beyond the control of the respective parties,
(iv) the degree to which the respective parties have fulfilled their duties under section 56 (3),
(v) the use that any party has made, or could have made, of any opportunity that has been available to the party in the course of the proceedings, whether under rules of court, the practice of the court or any direction of a procedural nature given in the proceedings,
(vi) the degree of injustice that would be suffered by the respective parties as a consequence of any order or direction,
(vii) such other matters as the court considers relevant in the circumstances of the case."
There is, however, no record in the transcript of the Civil Procedure Act being expressly referred to. Furthermore, nowhere in the transcript or in the discussions with counsel, can one find Magistrate Van Zuylen having regard to any of these sections in the decision-making process. He ought to have been aware that the Plaintiffs, at all relevant times, were defending the proceedings.
Had the learned Magistrate considered the sections, the proportionate response to the Plaintiffs' failure to attend could, at the time the matter was reached, require no more than an adjournment of the proceedings to another date with an order for costs thrown away by their failure to appear. Counsel for the Defendant accepted, during submissions, that, had the Plaintiffs been present when the matter was called, it could not have finished on that day and that, if it had been commenced, it would have been adjourned part-heard to another date. (He also conceded that, rather than adjourning part-heard, the learned Magistrate may have set the matter down for hearing on another date.)
In stating the above, I respectfully acknowledge what was said by Allsop ACJ in Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230, at [47]:
"My reasons should not be taken as undermining, in the slightest, the authority and rigour ss 56-61 give to judicial officers in the just, quick and cheap disposal of controversies. This will often require the hacking away of a morass of technicalities and excuses for delays often put forward by less than diligent litigants. That said, the terms of s 58 (and the consequential importance of s 57, as well as s 56) should be borne in mind when exercising these case management powers."
It follows that the proceedings before Magistrate Van Zuylen miscarried and that the appeal should be allowed.
The issue of costs must now be considered.
Section 3 of the Civil Procedure Act defines "costs" in relation to proceedings as meaning "costs payable in or in relation to the proceedings, and includes fees, disbursements, expenses and remuneration".
There are two aspects of costs - the first being the costs in the Local Court and the second being the costs in this Court. In respect of both sets of costs, the Defendant submits that, whatever the result in this Court, the Plaintiffs should pay the Defendant's costs. The Plaintiffs submit that there should be no order as to costs.
I have carefully considered the costs in the Local Court. It is clear that, had the Plaintiffs not left when they did, and had they remained within the Court precincts in Parramatta as recommended, the events of the afternoon of 29 March 2012 may not have occurred in the way that they did. Even if they had not been contacted to return, it is clear that Magistrate Viney informed the first Plaintiff, and that she said she understood, that whilst the learned Magistrate was unable to hear the matter, another Magistrate could do so and that, if they were not then present, that that Magistrate could determine the matter in their absence.
The Plaintiffs were urged to not depart the precincts of the court. They chose to do so and to not return. In my view, the Plaintiffs should pay the costs thrown away as a result of their departure from the Local Court and their failure to be present when Magistrate Van Zuylen dealt with the matter.
As Brereton J noted in O'Brien v Doherty [2008] NSWSC 205, at [22]:
"Normally on an application to set aside a default judgement, or to be let in to defend proceedings that have proceeded in a defendant's absence, the successful applicant is required to pay the unsuccessful respondent's costs on the basis that it requires an indulgence in a situation in which it has occasioned its own misfortune and put the other party to unnecessary costs and inconvenience. This case is analogous to that situation."
However, those costs should not include all of the costs of the Local Court proceedings because of the orders that will be made. If the matter does proceed to a hearing in that Court, at least some of the work already done will be able to be utilised. Presumably, the Defendant will be able to rely upon his signed Statement to which reference has been made.
Exercising my discretion and bearing in mind the matters set out in these reasons, the costs to be paid by the Plaintiffs should be limited to one half of the costs of the Defendant's solicitor and one half of the fees of counsel retained on 29 March 2012. The other costs and disbursements of each of the parties for work done in order to prepare for the hearing should be costs in the cause of the Local Court proceedings.
As for the costs in this court, the Defendant submits that these costs would not have been incurred but for the fact of the Plaintiffs leaving the Local Court before the matter was dealt with. Whilst, in part, this is true, I am of the view that the Defendant ought to have realised, particularly after Bergin CJ in Eq granted the stay, that there was a serious issue to be tried. Whilst the delay in commencing the proceedings in this Court was a relevant matter, it was only one of the matters that the Court was required to consider in determining whether to extend time for the appeal or leave to appeal. It should have been reasonably clear to the Defendant, in the circumstances of this case, and for the reasons given by her Honour, that an extension of time would be granted and that the appeal had reasonably good prospects of success. Thereafter, both time and resources could have been saved.
Furthermore, the general theory of costs relies on the result of the litigation: if one is successful, one is entitled to expect an order for costs.
In my view, the Defendant should pay the Plaintiffs' costs of the appeal. Of course, as the Plaintiffs were unrepresented throughout the appeal, those costs are limited. I have dealt with the issue of costs of a litigant in person in Wilson v Department of Human Services; Re Anna (No 2) [2011] NSWSC 545, at [110] - [114]:
"The general rule in relation to the costs of self represented litigants has, recently, been set out by Campbell JA (with whom Tobias and Young JJA agreed) in Preston v Commissioner for Fair Trading [2011] NSWCA 40 as follows:
"Costs
[182] At the hearing Ms Mirzabegian accepted that, if the appeal were to be upheld, it would be appropriate to make in favour of the Appellant an order for costs of the limited type that can be made in favour of a self represented litigant who is not a lawyer, namely for reimbursement of certain out of pocket expenses. The Appellant did not seek any more extensive costs order, or argue in favour of any particular type of costs order. After the hearing, in response to a question asked by the bench during the hearing, and a suggestion that this was "somewhat of a test case", Ms Mirzabegian sent a note stating that she was instructed that, if the appeal were to be dismissed, the Commissioner would not seek costs against the Appellant. It is the former alternative that has become applicable.
[183] It has been held, under a previous statutory regime authorising the making of costs orders, that a litigant in person who is not a lawyer is not entitled to receive an order for costs to compensate him for time spent in preparing and conducting his case: Cachia v Hanes [1994] HCA 14; (1994) 179 CLR 403. However a self-represented litigant who is not a lawyer can recover an indemnity for at least some out-of-pocket expenses actually and reasonably incurred: Secretary, Department of Foreign Affairs v Boswell (No 2) [1992] FCA 629; (1992) 39 FCR 288; Lawrence v Nikolaidis [2003] NSWCA 129; (2003) 57 NSWLR 355 at [37]. It appears from Cachia v Hanes at 417 that those out-of-pocket expenses were ones of the type which would have been recoverable as disbursements if the Appellant had been legally represented. Thus such expenses include filing fees: Deva v University of Western Sydney 2008] NSWCA 137 at [82]. Though there are some English cases, and some previous Australian authority (including Boswell) that say that under the heading of out of pocket expenses a litigant in person can get compensation for the opportunity cost of spending time on his litigation rather than on other paying work, since Cachia v Hanes those cases have not been followed in Australia: Lawrence v Nikolaidis at [37].
...
[185] There does not appear to be any relevant difference between the present statutory framework for costs orders, and the provisions that the High Court referred to in Cachia v Hanes. Thus the costs order should be the sort of order that the cases cited in [183] held was permissible."
It had been held in Cachia v Hanes [1994] HCA 14; (1994) 179 CLR 403 that the general rule means that a self-represented person is not entitled to recover compensation for time spent in preparing and conducting the case (at 412-414); that an order for costs is 'confined to money paid or liabilities incurred for professional legal services' (at 409), and that: 'costs are awarded by way of indemnity ... for professional legal costs actually incurred in the conduct of litigation' (at 410). Furthermore, that unless allowed for in the relevant legislation or rules, it is not permissible to treat, as a disbursement, any loss of earnings incurred by a litigant in presenting and conducting a case (at 417).
The litigant in person, normally, is entitled to out of pocket expenses actually, necessarily, and reasonably, incurred, and if the litigant qualifies as a witness, then she, or he, is entitled to the ordinary witness's fees, in addition to expenses for time actually spent giving evidence in court: Cachia v Hanes at 409, 410, 417; Lawrence v Nikolaidis & Co [2003] NSWCA 129; (2003) 57 NSWLR 355 at [35].
Expenses that have been found to be properly recoverable include court fees (B v P [2000] FamCA 392 at [50]; transcript costs (W (deceased) v W [2004] FamCA 319 at [41]); expenses for serving documents (Winter v Fleeton [2002] WASCA 73 at [23]); fees for searching registers, such as an ASIC search fee (Re Sullivan and Department of Industry, Science and Technology (1998) 51 ALD 767 at [45]); incidental expenses in relation to photocopying, postage and telephone and facsimile transmissions (Shephard v Blueberry Farms of Australia (Corindi) Ltd [2001] FMCA 2; (2001) 162 FLR 339 at [66]; Cary v Owners of Strata Plan No. 7241 [2002] FMCA 18).
Expenses which have been held not to be recoverable include travelling costs (W (deceased) v W at [49]); Farquar and Farquar (No 2) [2008] FamCA 682; Cachia v Hanes at p 417); parking costs (H v H [2006] FamCA 167 at [9]); and meals (Maronis Holdings Ltd v Nippon Credit Australia Ltd [2002] NSWSC 838 at [14])."
The order in favour of the Plaintiffs is limited to the amount of out-of-pocket expenses, of a type that would have been recoverable as disbursements if they had been legally represented and which they had actually and reasonably incurred. (I have omitted a reference to witness expenses because any expenses of the first Plaintiff, as a witness, were incurred because she did not serve an affidavit going to the matters about which she gave evidence and upon which she was cross-examined.)
To the extent that the costs of one party are assessed, or agreed, at a sum greater than the costs of the other, as assessed, or agreed, they may be set-off.
Accordingly, the appropriate orders are:
(1) Orders that the time for the filing of the Plaintiffs' summons to appeal and leave to appeal be extended to 6 November 2012, the date of the filing of the Summons.
(2) To the extent that it is necessary, grants leave, pursuant to s 40 of the Local Court Act, to appeal from the judgments of the Local Court.
(3) Orders that the appeal is allowed.
(4) Orders, pursuant to s 41(1)(b) of the Local Court Act, that the orders made by Magistrate Van Zuylen on 29 March 2012 be set aside.
(5) Orders that the judgment entered against each of the Plaintiffs on 11 April 2012 be set aside.
(6) Orders that the proceedings commenced by the Defendant be remitted to the Local Court, sitting at Parramatta, for determination.
(7) Orders, pursuant to s 7 of the Court Suppression and Non-Publication Orders Act 2010 (NSW), that there be no publication or other disclosure of the identity of the first Plaintiff's child, or of any evidence or other material which would tend to reveal the child's identity.
(8) Orders that the Plaintiffs should pay the Defendant's costs thrown away in the Local Court on 29 March 2012, such costs to be limited to one half of the costs of the Defendant's solicitor and one half of the fees of Defendant's counsel, of 29 March 2012.
(9) Orders that the Defendant should pay the Plaintiffs' costs of the appeal, such costs to be limited to the amount of out-of-pocket expenses, of a type that would have been recoverable as disbursements if they had been legally represented and which they had actually and reasonably incurred.
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Decision last updated: 26 February 2014
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