Michael Jack (By his Litigation Guardian Daniel Jack) v Koutsioulis
[2018] VSC 72
•23 February 2018
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PERSONAL INJURIES
S CI 2016 05250
| MICHAEL JACK (BY HIS LITIGATION GUARDIAN DANIEL JACK) | Plaintiff |
| v | |
| NICHOLAOS KOUTSIOULIS AND OTHERS (according to the Schedule attached) | Defendants |
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JUDICIAL OFFICER: | Judicial Registrar Clayton |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 16 February 2018 |
DATE OF JUDGMENT: | 23 February 2018 |
CASE MAY BE CITED AS: | Michael Jack (By his Litigation Guardian Daniel Jack) v Koutsioulis & Ors |
MEDIUM NEUTRAL CITATION: | [2018] VSC 72 |
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PRACTICE AND PROCEDURE – Application by third defendant to join third parties out of time - Whether application was made promptly – Consideration of competing rights of parties - Civil Procedure Act 2010 (Vic) s 7 – Supreme Court (General Civil Procedure) Rules 2015 (Vic) Order 11 – Application refused.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr A Mukherjee | Maurice Blackburn |
| For the First and Second Defendants | Ms L. Marx, Solicitor | Barry Nilsson Lawyers |
| For the Third Defendant | Mr P Lamb | Norton Rose Fulbright |
JUDICIAL REGISTRAR:
Introduction
This is an application brought by the third defendant, Flynn & Co. Real Estate Pty Ltd (‘Flynn’) for leave, pursuant to Order 11 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (‘the Rules’), to join two third parties some ten months out of time. The matter is fixed for hearing on 9 April 2018.
The first and second defendants (‘the landlords’) consent to the application.
The plaintiff, Mr Michael Jack, opposes the application on the basis that it is made too late, and, if the third parties are joined to the proceedings, the trial date will no longer be tenable. Any vacation of the trial date will prolong his financial stress and deny him adequate medical support.
There was no appearances for the proposed third parties at the hearing of the application.
Background
In October 2014 Mr Jack and his wife, Mrs Clair Jack, became tenants of the landlords in their premises in Rosebud West (‘the premises’). Flynn was the managing agent of the premises.
Mr Jack claims that in late October 2014 his wife contacted Flynn and reported that a bedroom ceiling fan at the premises was hanging down resulting in exposed electrical wires.[1]
[1]Statement of Claim filed 22 December 2016 [9].
On 6 November 2014 Flynn retained an electrician, Mr Tony Tropea, to attend the premises and fix the fan in the bedroom. Mr Jack alleges that Mr Tropea attended the premises and:
(a) inspected the fan and temporarily secured and covered the exposed wires;
(b) at the request of Mrs Jack, inspected two light fittings in the ceiling of the carport that were hanging down resulting in exposed wires;
(c) telephoned Flynn and spoke with an employee of Flynn and:
(i) advised that the fan in the bedroom needed to be replaced;
(ii) advised the light fittings in the carport were hanging down and needed to be fixed, and asked whether he should fix them;
(iii) was told by the employee of Flynn with whom he was speaking not to fix the carport lights.[2]
[2]Ibid[11].
Mr Jack says that between 7 November 2014 and 23 February 2015 the defendants did not take any action to repair or replace the light fittings in the carport which continued to hang down from the ceiling resulting in exposed wires.[3]
[3]Ibid [13].
On 23 February 2015 Mrs Jack attended Flynn’s premises to notify them that she and Mr Jack were vacating the property. Mr Jack claims that Mrs Jack also complained to Flynn about the state of the premises, including the lights in the carport.[4]
[4]Ibid [14]-[15].
Later on that day Mr Jack was in the carport at the premises and came into contact with an electrically live light fitting or wire hanging from the ceiling, causing him to suffer a severe electric shock (‘the incident’).[5]
[5]Ibid [16].
On 25 February 2015, Mr Tropea attended the premises at the request of Flynn and replaced the carport lights.
As a result of the incident, Mr Jack suffers from cognitive deficits, including speech impairment, memory loss, anxiety and depression. He requires ongoing care and assistance, and says that he is totally incapacitated for any employment.[6]
[6]Ibid [18].
Mr Jack brought this action for common law damages on 22 December 2016[7] and says that the landlords breached their duty to him to ensure that the premises he rented were maintained in good repair.
[7]By Writ.
Mr Jack also claims that Flynn breached its duty to him by failing to engage or authorise an electrician to make the carport lights safe before the incident.
The landlords and Flynn deny liability and claim contributory negligence on the part of Mr Jack and contribution from each other.
Flynn pleads that the risk of an electrical shock by the carport lights was an ‘obvious risk’ as defined by s 53 of the Wrongs Act 1958 (Vic).[8]
[8]Flynn’s Defence filed 17 February 2017 [25].
Flynn’s knowledge of Mr Jack’s claims
On 3 May 2016 the defendants were put on notice of this claim and served with an impairment certificate and report of Professor John Waterston. In August 2016 Flynn engaged solicitors, and on 22 December 2016 the Writ and Statement of Claim were served on all the defendants.
Therefore, from at least 22 December 2016 Flynn knew that Mr Jack alleged that:
(a) prior to the incident Mrs Jack had complained to Katherine Black, an employee of Flynn, about exposed electrical wires in the ceiling;
(b) Mr Tropea inspected two light fittings in the ceiling of the carport that were hanging down resulting in exposed electrical wires;
(c) Mr Tropea rang Flynn’s office and told Flynn that the carport lights were hanging down and needed to be fixed;
(d) Flynn told Mr Tropea not to fix the carport lights;
(e) in November 2014 Powerstar Electrical issued a quote to install two new light fittings in the carport;
(f) Flynn did not authorise or arrange new light fittings to be installed in the carport, and did not arrange any repairs or other work on the carport lights;
(g) the light fittings in the carport continued to hang down, exposing the wires;
(h) on 23 February 2015 Mrs Jack complained to Mr Michael Flynn, at the offices of Flynn, that the lights in the carport were hanging down; and
(i) on 25 February 2015 Flynn requested Mr Tropea attend the premises, and Mr Tropea found carport lights pulled out of the ceiling with wires damaged and exposed and light fittings not properly secured.
Flynn denies that it knew that the lights in the carport were hanging or that wires were exposed, save that, in its Defence it says that on 23 February 2015 Mrs Jack said to Mr Michael Flynn words to the effect that “even this morning a light fitting dropped down in the carport”.[9]
[9]Ibid [14].
From 22 December 2016 Flynn were also aware that Mr Jack pleaded cognitive deficits and memory loss amongst his injuries. In May 2016, Flynn had been served with the certificate of impairment and report of neurologist Mr Waterston dated 21 April 2016 in which Mr Waterston notes that ‘Mr Jack has no memory of the actual incident. His last memory is of coming home from work and having something to eat.’ Mr Waterston diagnosed Mr Jack with a significant brain injury which has resulted in cognitive dysfunction, emotional dysfunction, disequilibrium and impaired function in his dominant right hand. Mr Waterston noted a neuropsychological report of Dr Rachel O’Meara dated 15 April 2015 which reported ‘deficits in attention, speed of information processing and aspects of executive functioning (verbal abstract reasoning, letter fluency, planning and organisation and self-monitoring)’. Mr Waterston found that these described deficits were highly consistent with the everyday difficulties Mr Jack and his wife reported.
At the time of service of the Writ, Flynn was also aware that Mr Jack had appointed a litigation guardian to conduct the litigation.
On 18 September 2017 Mr Jack, by his litigation guardian, swore answers to Flynn’s interrogatories. In those answers, Mr Jack was unable to say whether he was aware of his wife’s alleged complaint to Mr Tropea about the carport lights and says that he does not believe that he was aware of Mrs Jack’s alleged complaint to Mr Flynn about the carport lights on 23 February 2015. In September and November 2017 Flynn also received answers from the landlords to its interrogatories which set out what repairs the landlords had undertaken at the premises, which did not include any repairs to the carport lights.
At some point prior to December 2017, Flynn was served a report of Ms Sophie Lyons dated 14 November 2017 in which Ms Lyons opined that a competent real estate agent should have responded to any complaint by Mrs Jack or Mr Tropea regarding a ‘lights defect’. Ms Lyons based her opinion on a number of facts she was asked to assume. This report from Ms Lyons prompted Flynn to seek the letter of instruction with which she had been provided. That letter of instruction, dated 10 October 2017, was obtained by Flynn on 6 December 2017. In that letter of instruction Ms Lyon is asked to assume the facts as alleged in the Statement of Claim. At paragraph 11 of that letter Ms Lyon is asked to assume the following fact:
‘During Michael and Clair’s tenancy, the light fittings in the carport were not replaced or repaired. One of the carport lights dropped further over the next few months’.[10]
[10]Affidavit of Ross Antony Donaldson sworn 7 February 2018, Exhibit RAD2 [11].
Flynn’s Arguments
Flynn says that it was only when it was served with answers to its interrogatories in September 2017, that it became aware that Mr Jack had no memory of the incident and events prior to the incident and that he probably did not know of Mrs Jack’s complaint to Mr Michael Flynn on 23 February 2015.
Flynn says that in September and November 2017 it received answers to interrogatories from the landlords about the status of the carport lights and any repairs effected by the landlords ‘which may not have been within the third defendant’s knowledge’[11] prior to the receipt of those answers. It is not clear from Mr Donaldson’s Affidavit if he is saying that Flynn did not know that the landlords had not undertaken any repairs on the carport lights without involving Flynn, or whether Mr Donaldson does not know whether this information was within Flynn’s knowledge prior to receipt of those answers. In any event, Mr Jack alleged that no repairs were undertaken prior to 25 February 2015 and this was known to Flynn.
[11]Ibid [20].
It says it was only in December 2017 that it first became aware that Mr Jack alleged that one of the carport lights dropped further in the months preceding the incident.
Based on the new knowledge it obtained in September and December 2017, Flynn says that, if Mr Jack’s allegations about the carport light are correct, then both Mrs Jack and Mr Tropea breached their duty to him and consequently may be liable to him for damages.
Flynn says that given the evolving state of its knowledge from the time it was first served with the Statement of Claim in December 2016, it has acted reasonably promptly to undertake investigations and satisfy itself that there is a proper basis for bringing claims against Mr Tropea and Mrs Jack.
Flynn acknowledges that the joinder of Mr Tropea and Mrs Jack would require a vacation of the trial date, but says that to require it to bring separate proceedings would be unjust and inefficient.
It says that it would be inefficient because it would re-tread the same factual ground in both proceedings, would require the same expert and quantum evidence wold replace one large complex trial with two large complex trials. It would also be impractical, as Mr Jack’s primary witness is likely to be Mrs Jack and she would then be giving evidence as defendant in a separate proceeding which would get ‘inordinately messy’ and give rise to inefficiency.
Mr Jack’s Arguments
Mr Jack opposes the application to join the third parties on the basis that it would delay the trial in circumstances where he is a severely injured person who is unable to afford all the medical attention that he needs.
The expert opinion of his treating neuropsychologist, Dr Kim Roffell, is that he requires 24 hour support and supervision.[12] The consequences of his injury mean he has been unable to work, and his only source of income is a disability support pension. Mrs Jack is his fulltime carer and receives a carer’s pension, and they rely on this income to pay their mortgage and daily expenses.[13]
[12]Affidavit of Jilnar Zeina affirmed on 15 February 2018, Exhibit JZ2.
[13]Ibid [4].
Due to financial constraints, Mr Jack cannot afford to pay for attendant care and a large component of his care is provided gratuitously by Mrs Jack. Mrs Jack does not get sufficient respite from caring for him which is impacting on her mental health and their relationship.
Mr Jack says that a delay of the trial will cause irreparable prejudice to him of a kind that cannot be ameliorated by costs orders.
Mr Jack says that Flynn has, since December 2016, been in possession of all necessary information to determine whether to join Mr Tropea and Mrs Jack as third parties.
Relevant Principles
Pursuant to r 11.05 of the Rules, a defendant may file a third party notice within 30 days after the time limited for the service of a defence, or at any time with the leave of the Court or with the consent in writing of the plaintiff and any other party who has appeared.
In exercising its discretion, the Court must consider s 7 of the Civil Procedure Act 2010 (Vic) (‘the Act’) which sets out that the overarching purpose of the Act, and the rules in civil proceedings to ‘facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute’ and have regard to the competing interests of the parties.
On the one hand a defendant has an entitlement to pursue a party against whom it reasonably considers it could seek a contribution. To have third party proceedings heard at the same time as the trial of the primary proceeding may be the most efficient and cost effective means of disposing of a matter. On the other hand, a plaintiff has an entitlement not to have the proceedings unduly complicated or delayed by the addition of a third party, particularly in circumstances where a delay would be substantial and likely to cause real prejudice.
In Fenridge Pty Ltd v Retirement Care Australia Preston Pty Ltd & Ors[14] Dixon J found that an unexplained delay of three years in bringing a third party claim would cause inconvenience to the plaintiff that would outweigh the inconvenience to the defendants in not being able to have their claims against the proposed third party disposed of in the same hearing.[15]
[14][2012] VSC 439.
[15]Ibid [29]-[31].
AON Risk Services[16] establishes that there can be a degree of irreparable prejudice to a party where there is a delay in finalisation of a case.
[16]AON Risk Services v Australian National University (2009) 239 CLR 175.
There is no guarantee that Mr Jack will succeed in his litigation, and therefore no guarantee that his financial situation will improve as a result. Nevertheless, the Court accepts that the prolongation of financial uncertainty in these circumstances is likely to significantly contribute to the stress and anxiety Mr Jack experiences. I accept that there is a degree of irreparable prejudice that will be caused to Mr Jack if the trial is significantly delayed.
The reality in this case is that, if the application is granted, the delay would necessarily have to be substantial. The proposed third parties would have to be given sufficient time to prepare their defences, and, at least in the case of Mr Tropea, this would likely involve obtaining expert opinions which may take many months. It is unlikely that the matter would be ready to be refixed for hearing this year.
In the context of a substantial delay, it is particularly important to examine why the application has been made so close to the trial date.
In this case, Flynn asserts that there has been no real delay, and that it has acted promptly upon receipt of each new piece of information to further investigate and satisfy itself of the proper basis of its proposed third party claims.
This assertion needs to be tested.
Flynn’s case against Mrs Jack
As at May 2016, Flynn was aware of Mr Jack’s cognitive problems, including with memory. The report of Mr Waterston says that Mr Jack has no memory of the incident. These difficulties were confirmed in the allegations of injury in the Statement of Claim served in December 2015.
From this, and the fact that Mr Jack had a litigation guardian, Flynn knew that Mr Jack could not remember the incident. The answers to interrogatories confirmed to Flynn that Mr Jack had no memory of the incident and added new information that he had ‘significant problems with his memory…of events which occurred prior to the incident’.[17] He was unable to say whether he knew that lights in the carport were hanging down and whether he knew that Mrs Jack had requested Mr Tropea to ‘inspect two light fittings in the ceiling of the carport that were also hanging down resulting in exposed electrical wires.’[18] He did not believe that he knew that Mrs Jack had complained to Flynn on 23 February 2016 about the carport lights.[19]
[17]Plaintiff’s Answers to the Interrogatories of the Third Defendant filed 20 September 2017 [2].
[18]Ibid [4].
[19]Ibid [3].
Whilst there is some additional information provided to Flynn in the answers to interrogatories, it does not substantially change the picture that Flynn has of Mr Jack as a person whose memory is significantly impeded and who will not be able to give evidence about the circumstances of his accident, and his knowledge of the carport lights prior to the incident.
The Statement of Claim clearly sets out that Mrs Jack had knowledge of, and made complaints, about the carport lights. There is no new information that arises from the answers that changes the state of knowledge that Flynn has about Mrs Jack.
From the Statement of Claim Flynn knew that it was Mr Jack’s case that the only occasion Mrs Jack complained directly to it about the carport lights was on 23 February 2015. That allegation has not changed.
The only other complaint that Mr Jack says was made about the carport lights is a complaint by Mrs Jack to Mr Tropea. Mr Jack does not allege that he ever made any complaints about the carport lights.
Flynn places great weight on the fact that it only discovered in December 2017 that Mr Jack says that the carport light fitting continued to drop between November 2014 and February 2015. It infers that this information must come from Mrs Jack. However, Flynn did know that Mrs Jack believed that the light fitting had dropped on 23 February 2015 because it pleads this in its Defence.
Flynn’s defence is that it did not know of any problem with the carport lights until the day of the incident. In its claim for contribution against Mr Jack, Flynn alleges that he failed to ‘submit a written, formal complaint…about the defective lights’ and ‘failed to pursue a request to rectify the defective lights’, as well as failing to take proper care for his own safety.[20] Whether the lights continuously and incrementally dropped between November 2014 and February 2015 or whether the wires in the lights were exposed in November 2014 and then became more exposed on the morning of 23 February 2015, does not alter the basis of the claim that Flynn now says it has against Mrs Jack:
[20]Flynn’s Defence filed 17 February 2017 [24].
(a) Flynn says that Mrs Jack owed Mr Jack a duty as a tenant and occupier of the premises who had control or part control of the premises. Flynn was always aware that Mrs Jack was a tenant and occupier of the premises.
(b) Flynn alleges that Mrs Jack breached this duty by failing to report the carport lights hanging down and failing to take any reasonable steps to report the lights hanging down. Flynn has always known what complaints Mrs Jack alleges she made. If a claim against Mrs Jack exists on this basis, it existed, and should have been known to Flynn, in December 2016.
(c) Flynn alleges that Mrs Jack breached her duty by failing to warn Mr Jack about the carport lights, failing to take various steps to fix the lights and failing to stop Mr Jack from working on the back of his utility as such work would expose him to risk from the exposed wires on the carport lights. Nothing that has come to light since December 2016 gives Flynn any greater basis for considering it has a viable claim against Mrs Jack, than it would have had in December 2016.
I therefore do not accept that Flynn has acted promptly and reasonably in bringing this application to join Mrs Jack as a third party out of time. Mrs Jack could have been joined as a third party within time.
Flynn’s case against Mr Tropea
Mr Jack alleges that Mr Tropea called Flynn, told Flynn about the lights and was denied authorisation to fix the lights. From the Statement of Claim, Flynn was aware that:
(a) Mr Jack says that Mr Tropea knew about the problem with the carport lights and did not fix the lights;
(b) the quote provided by Mr Tropea in November 2014 to install two new light fittings to the carport did not state that the lights in the carport were hanging down resulting in exposed wires;
(c) Mr Tropea had not followed up the quote with additional communications to inform it that the quote made reference to recommending repairs to the carport lights which were hanging down in the carport, resulting in exposed wires; and
(d) Mr Tropea had not repaired, removed or made safe the carport lights hanging down resulting in exposed electrical wires when he inspected those lights on 6 November 2014 and from then on.
All the allegations against Mr Tropea that Flynn relies on in its proposed third party claim were known to it in December 2016. There is nothing in any of the material before me to suggest that anyone alleges that Mr Tropea knew that the carport light continued to descend between November 2014 and February 2015, or that Mr Tropea had attended the property at any time other than in November 2014.
I am unable to see that there is any additional information that has come to light since December 2016 that would reasonably cause Flynn to consider it had a claim against Mr Tropea that had not previously been apparent.
Flynn also says that the interests of justice favour the application being granted because there is the potential for two large hearings instead of one, and evidentiary difficulties where Mrs Jack is a witness in one hearing and a defendant in another. Presumably the same potential exists in relation to Mr Tropea.
Whilst the efficient delivery of justice is of great importance, and unnecessary duplication ought to be avoided wherever possible, the Act requires that cost-effectiveness and efficiency must be balanced with justice and timeliness.[21]
[21]Section 7.
It is a matter for the trial judge as to whether orders would be made in relation to the expert medical evidence to avoid unnecessary duplication. Other expert evidence is unlikely to significantly overlap, as Mr Jack’s proceeding focuses on the reasonable conduct of a managing agent, whilst Flynn’s case would presumably focus on the reasonable conduct of an electrician. I am not satisfied that the efficiencies gained from having one trial outweigh the prejudice occasioned by vacating the trial date.
I am not satisfied that the third party claims could not have been brought within time, or within a time that could have avoided the inevitable vacation of the trial date. I am satisfied that vacating the trial date would cause a degree of irreparable prejudice to Mr Jack.
In balancing the competing rights of the parties and the requirements of s 7 of the Act, I dismiss the application and order that the third defendant pay the plaintiff’s costs on a standard basis.
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SCHEDULE OF PARTIES
| S CI 2016 05250 | |
| BETWEEN: | |
| MICHAEL JACK (BY HIS LITIGATION GUARDIAN DANIEL JACK) | Plaintiff |
| V | |
| NICHOLAOS KOUTSIOULIS | First Defendant |
| EFFIE BLIAS | Second Defendant |
| FLYNN & CO. REAL ESTATE PTY LTD (ACN 127 107 484) | Third Defendant |