Moses v Ratner

[2021] NSWSC 185

Supreme Court

New South Wales

Medium Neutral Citation:

Moses v Ratner [2021] NSWSC 185

Hearing dates:

3 March 2021

Date of orders:

12 March 2021

Decision date:

12 March 2021

Jurisdiction:

Common Law

Before:

Davies J

Decision:

(1) The Notice to Admit Facts dated 20 October 2020 is set aside.

(2) The plaintiff is to pay the defendants’ costs of the notice of motion.

(3) The proceedings are removed from the Possession List.

(4) The defendants’ notice of motion filed 2 March 2021 and the proceedings generally are stood into the Registrar’s list on 19 March 2021.

Catchwords:

CIVIL PROCEDURE – service – deemed or informal service – electronic service - course of correspondence between parties by email to solicitors – Notice to Admit Facts sent by email with 14 days to reply – where solicitor for defendant was unaware of email until after 14 day period – application to set aside – whether consent given to serve court documents by email – where no actual or inferred consent given – where parts of Notice to Admit Facts otherwise amounts to an abuse of process – Notice to Admit Facts set aside

Legislation Cited:

Civil Procedure Act 2005 (NSW)

Corporations Act 2001 (Cth)

Evidence Act 1995 (NSW)

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; [2006] HCA 27

Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738

Edwards v The State of New South Wales [2017] NSWSC 459

Gerard Michael McGuirk v The University of New South Wales [2009] NSWSC 253

In the matter of Australasian Barrister Chambers Pty Limited [2020] NSWSC 304

In the matter of Boss Constructions (NSW) Pty Ltd [2019] NSWSC 543

In the matter of Outix Corporation Pty Limited [2019] NSWSC 1716

Parkesbourne Mummel Landscape Guardians Inc v Minister for Planning [2009] NSWLEC 101

Rogers v The Queen (1994) 181 CLR 251; [1994] HCA 42

Rossi v Living Choice Australia Limited t/as Living Choice (No 2) [2012] NSWLEC 144

Savage v Australian Unity Funds Management Ltd [2011] NSWCA 270

Woodgate v Garard Pty Ltd [2010] NSWSC 508

Texts Cited:

Nil

Category:

Procedural rulings

Parties:

Michael Isaac Moses (Plaintiff)
Gabriella Ratner (First Defendant)
John Ratner (Second Defendant)

Representation:

Counsel:
A M Gruzman (Plaintiff)
M Fozzard (Defendants)

Solicitors:
Boskovitz & Associates (Plaintiff)
A R Conolly & Company (Defendants)

File Number(s):

2019/354282

Publication restriction:

Nil

Judgment

1. These proceedings arise out of a joint venture between the plaintiff and the defendants to develop land in Blake Street, Rose Bay, by subdividing it and building two residences. The plaintiff was to receive one of the residences and the defendants (who are husband and wife) were to receive the other residence.

2. The dispute between them is, in effect, how much should be contributed by each of the joint venturers.

3. The proceedings commenced on 11 November 2019 but have been substantially amended since that time. The present iteration of the claim is a further amended statement of claim filed 14 February 2020. The plaintiff appears uncertain as to who of the defendants was the party with which he was dealing, and the further amended statement of claim joined the second defendant (the first defendant’s husband) to the proceedings for the first time. The claim made against each defendant is essentially the same, but is made against both of them together or against each in the alternative.

4. Defences and replies have been served, as has a cross-claim by the defendants against the plaintiff. A defence to the cross-claim was filed on 9 April 2020. For all intents and purposes the pleadings are closed, but it appears that the defendants wish to file an amended cross-claim. On 15 December 2020 the defendants were ordered to serve any proposed amended cross-claim by 18 December 2020, with provision being made for consent to be provided by the plaintiff/cross-defendant. I was informed at the hearing that the proposed amended cross-claim was served on 2 March 2021 and that a further amended statement of claim was due to be served.

The Notice to Admit Facts

5. The dispute, the subject of this judgment, concerns a Notice to Admit Facts and Authenticity of Documents dated 20 October 2020 (“the Notice”). The Notice was served by email on the defendants’ solicitor. It is that service by email which forms the basis of the present dispute between the parties.

6. By a notice of motion filed 18 December 2020 the defendants seek that the Notice be set aside. The principal affidavit in support of the motion is that of Elizabeth Ramsay sworn 18 December 2020. Ms Ramsay is a solicitor in the office of the defendants’ solicitor, A R Conolly and Company.

7. Ms Ramsay says that the Notice was sent under cover of an email to the email address [email protected]. Ms Ramsay said that in the defences filed on behalf of each of the defendants there is written alongside “electronic service address” the letters “NA”, which means not applicable.

8. Ms Ramsay said that when the proceedings were subsequently before the Registrar on 15 December 2020 an order was made by consent which enabled the service of documents on the parties’ solicitors in each case by email, specifying the email addresses to which the documents should be sent.

9. Ms Ramsay said that Mr Conolly routinely receives about 150 emails a day. A clerk is engaged to review Mr Conolly’s email box each day, and when emails of importance appear they are distributed to the relevant person in the office. Ms Ramsay said that that is rarely necessary as most emails were copied to the relevant team member involved in the matter.

10. When it became apparent that the Notice had been sent by email to Mr Conolly’s email address, the clerk was asked to review the emails. When she did so, she located the email and she said that she must have missed it because she did not send it on or print it for the file. Neither Mr Conolly, Ms Ramsay nor any other person in the solicitor’s office involved in the present proceedings read or saw the email attaching the Notice at the relevant time.

11. The plaintiff swore an affidavit in response to Ms Ramsay’s affidavit. In it he said that he had been advised by his solicitor and believed; that each of the defendants’ court documents was served on him by email; that between December 2019 and September 2020 his solicitor corresponded with the defendants’ solicitors by sending emails to the email addresses [email protected] and/or [email protected]; that on 1 October 2020 the plaintiff’s solicitor received an email from Mr Conolly saying that his associate, Peter Matthews, had left the firm; that after that date the plaintiff’s solicitor had corresponded with the defendants’ solicitors by sending emails to [email protected], and occasionally replying to emails from other representatives of the defendants at their respective email addresses; that on 20 October 2020 the plaintiff’s solicitors sent under cover of an email the Notice; and that as at 20 October 2020 the plaintiff’s solicitor had not received any request from the defendants’ solicitors that all emails to Mr Conolly be copied to his clerk and the solicitor assisting him.

12. The plaintiff also tendered an email dated 9 March 2020 from Mr Matthews to the plaintiff’s solicitor saying (inter alia):

Please ensure all future correspondence is sent to both myself and Alan Conolly, as I note your request for particulars was delivered to my email only.

13. Since the email serving the Notice was not seen by any person at the defendant’s solicitor’s office, the 14 day period specified in the Notice passed without any response to the Notice. The effect of that was to mean that the facts and authenticity of the document specified in the Notice were deemed to have been admitted (rr 17.3 and 17.4 Uniform Civil Procedure Rules 2005 (NSW)).

14. The applicant seeks to set aside the Notice on the bases that it was not served in accordance with the UCPR, that it would be unfair and unjust to allow it to remain with the deemed admissions, and that the Notice itself is an abuse of process either wholly or in part. In the alternative, the applicants ask for leave to withdraw the deemed admissions for the same reasons. Reliance is placed on s 61 of the Civil Procedure Act 2005 (NSW), and rr 2.1, 17.3(3) and 17.4(3) of the UCPR.

Service

15. Rule 3.7 UCPR provides:

3.7 Electronic service of a document

A party to any proceedings before the court may use electronic mail to serve a document on any other party to proceedings, whether by means of Online Registry or otherwise, but only with the consent of the other party.

16. Rule 10.5 UCPR deals with various methods of service. Sub-rule (2) provides:

(2) In the case of a person having an address for service that is a solicitor’s office address, service of a document on the person may also be effected -

(a) if the notice advising the address for service includes a DX address, by leaving a copy of the document, addressed to the solicitor, in that DX box at that address or in another DX box for transmission to that DX box, or

(b) if the notice advising the address for service includes a fax number, by faxing a copy of the document to that number, or

(c) if the notice advising the address for service includes an electronic service address, by transmitting an electronic copy of the document to that address.

17. I was referred to a number of cases that concerned service by email. In Savage v Australian Unity Funds Management Ltd [2011] NSWCA 270 Young JA was considering whether a party’s solicitor had been notified of a notice of motion to dismiss an appeal. The Notice of Appeal contained the name of the solicitor’s firm, the solicitor acting and an email address, but it was noted on the summons “Electronic service address not applicable”. In fact, the solicitor was notified by email that the notice of motion would be before the Court. The other party did not appear.

18. Justice Young said that he was concerned for a number of reasons. The first is irrelevant to the present matter. His Honour then said:

[10]   ...Second, although an email address was given in the initiating process in the Court of Appeal, the words "not applicable" occurred after "electronic service address" and I consider that it is more likely than not that the notice of appeal and summons does not advise an address for service which includes an electronic service address. If this is so, then even if the solicitor still had authority to receive documents on behalf of a client in the matter, there was insufficient service.

19. In Rossi v Living Choice Australia Limited t/as Living Choice (No 2) [2012] NSWLEC 144 the parties had been serving letters and court process electronically. The solicitors for the defendant then gave notice that they would no longer accept service of documents electronically because of the way the firm operated, including some staff working part-time only. The plaintiff’s solicitors sought an order under UCPR r 2.1 that the defendant’s solicitor accept documents electronically.

20. Pepper J said that the methods by which a document could be served were set out in r 10.5. Her Honour then said:

[45] If a person, in this case Living Choice, has an address for service that is a solicitor's office address, then service of a document on Living Choice can be effected by transmitting an electronic copy of the documents to that address if the notice advising the address for service includes an electronic service address (r 10.5(2)(c) of the UCPR). No such address has been included in the Notice of Appearance filed on behalf of Living Choice. This is presumably because of the policy referred to above.

[46] Mr Rossi is the moving party to these proceedings. While it may be inconvenient and more expensive for Mr Briggs to serve documents on the first and second respondents other than in a manner mandated by the UCPR, this does not excuse compliance with r 10.5. Even if it were accepted that r 2.1 of the UCPR contains a plenary power that permits the Court to dispense with r 10.5, I do not consider that, in this case, inconvenience and expense alone are sufficient to circumnavigate compliance with that rule. The application is therefore refused.

21. In In the matter of Outix Corporation Pty Limited [2019] NSWSC 1716 Rees J was concerned with service of an application to set aside a statutory demand, and whether it had been served within the 21 day period in s 459G of the Corporations Act 2001 (Cth) in circumstances where it had been served by email only. The solicitor for the creditor sent a letter by email to the company’s solicitor saying:

We confirm we hold instructions to accept any set-aside application and are confident of successfully opposing the same.

The signature portion of the letter bore the solicitor’s name, followed by his email address at which the parties had routinely corresponded for the preceding six months. After receipt of that letter by email, the company’s solicitors sent the originating process and affidavit in support to the defendant’s solicitors by email.

22. Justice Rees noted r 3.7 UCPR and said:

[21] Although the statutory demand did not include an e-mail address for the defendant’s solicitor, it seems to me from the evidence of Mr O’Loughlin, together with the letter from the defendant’s solicitor of 27 September 2019, that it can be inferred that the defendant consented to being served by e-mail with an application to set aside the statutory demand. That is the means by which these parties had been corresponding for six months. That was how the inclusion of the defendant’s solicitor’s signature portion of his letter could be reasonably understood. It seems to me that consent had been given under rule 3.7 of the Rules and, thus, the application was validly served by e-mail on 2 October 2019.

[22]   Even if I had not come to that view, the Originating Process may still have been served by e-mail if it had actually come to the attention of the defendant by that means: Howship Holdings Pty Ltd v Leslie (No 2) (1996) 41 NSWLR 542 at 544–5.

[23]   As I set out in In the Matter of Boss Constructions (NSW) Pty Ltd [2019] NSWSC 543, at [22]:

E-mails are transmitted to, and electronically stored, on a server and positive action is needed on the part of the receiver to access the e-mail through their computer and read it. As such, electronic service by e-mails is not generally taken to have been effective until the recipient of the e-mail downloads the e-mail from the server and reads it.

In this case, Mr Marshall deposed that in the week of 30 September 2019 to 4 October 2019 he was predominantly focussed on the completion of a multi-million dollar acquisition and did not regularly check his e-mail inbox unless it related to that acquisition. For that reason, although the e-mail was sent to him on 2 October 2019, he says that he did not open the e-mail until 4 October 2019, which I note is beyond the 21 day period provided by section 459G.

23. In In the matter of Australasian Barrister Chambers Pty Limited [2020] NSWSC 304, the issue was whether a respondent to an application by a liquidator had been served with notice of the liquidator’s application. A director of the company had on a number of occasions been given leave to appear for the company and he had filed court documents which amongst other things contained his email address. The application by the liquidator had been sent to that email address. The director contended that there had been no proper service.

24. Justice Rees said:

[15] Third, it is apparent from the notices filed by Mr Minus with the Court, referred to at [7] and [10], that ABCD Corporation has consented to electronic service in accordance with UCPR rule 3.7 and the parties have been conducting themselves accordingly for some time. Even if the notices had not made this clear, consent may also be inferred from the manner in what a party has chosen to communicate over the course of a dispute or legal proceedings: In the matter of Outix Corporation Pty Limited [2019] NSWSC 1716 at [21]. Such consent may be inferred here given the evidence of Mr Dale as to his email communications with Mr Minus in these proceedings for more than four years.

[16]   Fourth, even if a party has not consented to electronic service, a document may still have been served by email if it actually came to their attention by that means: Howship Holdings Pty Ltd v Leslie (1996) 41 NSWLR 542 at 544-5; (1996) 21 ACSR 440 at 443-4 per Young J. The principles concerning “effective informal service” were summarised by Palmer J in Woodgate v Garard Pty Ltd (2010) 78 ACSR 468; [2010] NSWSC 508 at [44]: (citations omitted)

Inconsistency and uncertainty in an area of the law which is of everyday application merely multiply occasions for dispute. It may, therefore, be useful to summarise the principles which are supported by the preponderance of authority, as follows:

…

iv) the prescribed modes are not exclusive of other modes of service: if some other mode of service is employed, whether it is good service depends upon whether the serving party can prove to the Court’s satisfaction that the document actually came to the attention of an officer of the company who was either expressly or implicitly authorised by the company to deal directly and responsively with the document, or documents of that nature (“a responsible officer”) … ;

v) there is no special exception to the “effective informal service rule” in the case of service by e-mail or facsimile – the question remains whether that mode of service actually brought the document to the attention of a responsible officer…;

vii) a party invoking the effective informal service rule bears the onus of proving the time at which the document came to the actual attention of a responsible officer of the company and, in view of the serious consequences which may attend, the Court will not lightly draw inferences or make assumptions as to the time of service ….

25. Mr Gruzman of counsel for the plaintiff submitted that in the present case the email of 9 March 2020 provided actual consent within the meaning of r 3.7 to serve court documents by email. Mr Gruzman submitted, alternatively, that the plaintiff’s evidence about the way documents and correspondence had been transmitted between the solicitors over the course of the proceedings demonstrated implied consent on the part of the defendants’ solicitor. He placed reliance on what Rees J said in those two cases concerning inferred consent. He submitted that, even if that were not so, the Court should dispense with the requirement of consent to electronic service nunc pro tunc.

26. In my opinion, the email of 9 March 2020 does not show that actual consent was given for service of court documents for a number of reasons. First, the email was concerned only with regularising what had been occurring between the parties in circumstances where a particular letter, a request for particulars, had not been copied to Mr Matthews. The plaintiff’s affidavit said that between December 2019 and September 2020 his solicitor corresponded with the defendants’ solicitors by sending emails to the email addresses [email protected] and/or [email protected]. In that way, the email of 9 March 2020 was not instituting some new arrangement between the solicitors.

27. Secondly, the email refers only to “future correspondence”. In the face of rr 3.7 and 10.5, it should not be lightly inferred, without any reference to those rules, that the email was giving consent to court documents being served that way. Mr Gruzman submitted that court documents were ordinarily served under cover of an email, and in that way the email should be seen as providing consent. I do not agree. Court documents and their service are governed by the UCPR; correspondence is not.

28. Thirdly, on 13 March 2020, the defendants’ solicitor filed on behalf of the second defendant a defence to the amended statement of claim in which, consistently with what had appeared in the amended defence of the first defendant file on 28 February, alongside “Electronic service address” the letters “NA” appeared. It was not reasonable for the plaintiff’s solicitors to have inferred or believed from the email of 9 March 2020 that consent was given to serve court documents electronically, when in the weeks on either side of the email of 9 March 2020, the defendants’ solicitor filed defences expressly rejecting any electronic service of court documents.

25. Nor do I consider that consent should be inferred, either from the email of 9 March 2020 or from the course of dealing between the parties. Accepting all that the plaintiff said in his affidavit, all it proves is that the defendants had served documents on the plaintiff’s solicitor electronically, and that the parties had exchanged correspondence in that way.

26. In my opinion, the cases determined by Rees J are distinguishable. Unlike the position in Savage, the parties served in those cases did not specify on their pleadings or otherwise that electronic service was not to take place. Moreover, Rees J did not refer at all to r 10.5(2)(c), which is the primary rule enabling methods of service of documents. Rule 3.7 must be seen as an adjunct to the provisions of r 10.5(2)(c). In any event, as Rees J pointed out in In the matter of Boss Constructions (NSW) Pty Ltd [2019] NSWSC 543 at [22], electronic service by emails is not generally taken to have been effective until the recipient of the email downloads the email from the server and reads it.

27. In similar fashion, Palmer J said in Woodgate v Garard Pty Ltd [2010] NSWSC 508 at [44]:

iv) the prescribed modes are not exclusive of other modes of service: if some other mode of service is employed, whether it is good service depends upon whether the serving party can prove to the Court’s satisfaction that the document actually came to the attention of an officer of the company who was either expressly or implicitly authorised by the company to deal directly and responsively with the document, or documents of that nature (“a responsible officer”): see the cases referred to in paragraph 42;

v) there is no special exception to the “effective informal service rule” in the case of service by e-mail or facsimile – the question remains whether that mode of service actually brought the document to the attention of a responsible officer: Austar Finance (supra) at [49]; Australian Securities Commission v Bank Leumi Le-Israel (Switzerland) (1996) 69 FCR 531, at 550 per Lehane J; Millerview Constructions Pty Ltd v Palmer Plumbing Pty Ltd [2008] QSC 3, at [11]; Dwyer v Canon Australia (supra) at [7]; cf Fingalbay Pty Ltd v Rengay Nominees Pty Ltd (1997) 142 FLR 340; Griffith Producers Co-operative Co v Calabria (supra);

32. I am satisfied from the evidence of Ms Ramsay that the email attaching the Notice to Admit was not downloaded, and was not read, until after the 14 day period had expired, assuming that time commenced to run from when the email was sent and received. The plaintiff cannot show that the email actually came to the attention of Mr Connolly or the solicitor with carriage of the matter to demonstrate that service was effected informally.

33. The evidence in the present case supports an explanation why a solicitor might be content to communicate ordinarily by email, but would not wish Court documents to be served by email. With large volumes of emails coming into a solicitor’s inbox on a daily basis, it would be easy to miss a document such as the Notice, or the sort of documents referred to by Rees J, where responding to the document involved time being of the essence. What was said in Rossi at [42] provides a further rational explanation why such a distinction might be made.

34. Here, the defendant’s solicitor had clearly stipulated that electronic service of court documents was not to take place in accordance with r 10.5(2)(c). No basis is shown for overriding that authorised decision to bring about the result that a document is held to have been served in a manner that the solicitor expressly excluded.

35. On that basis, the Notice was not served on the defendants’ solicitor. Although a declaration could be made to that effect, the easier course is to set the Notice aside.

36. Nor do I consider that I should over-ride the election under r 10.5 of the defendants’ solicitor, as Mr Gruzman suggested could be done, nunc pro tunc. Had Mr Connolly been aware that such an application was to be made, he may have wished to file evidence about why he had made such an election: Rossi at [46].

Abuse of process

37. Even if I am wrong in relation to the effectiveness of service of the Notice, I consider that parts of the Notice should otherwise be set aside because they amount to an abuse of process.

38. The Notice says this:

The Plaintiff requires you to admit the following facts;

1.   (a) The amount of money expended by or on behalf of the First Defendant I

Second Cross-claimant and/or the Second Defendant / First Cross- claimant ("the Defendants") and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at 8 Blake Street, Rose Bay NSW [which later became to be known as 8 and 8A Blake Street. Rose Bay NSW) (“the Blake Street Property") was $1,733,512.62 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was $1,733,512.62 +GST

2.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was between $1,700,000.00 (inclusive of GST) and $1,750,000,00 (inclusive of GST),

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 561) for and in respect of the project at the Blake Street Property was between $1,700,000,00 + GST and $1,750,000.00 + GST,

3.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was $1,692,539.62 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was $1,692,539,62 plus GST, 

4.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Ply Limited (ACN 136 639 651) for and in respect of the project at the Blake Street Property was between $1,650,000.00 (inclusive of GST) and $1,720,000.00 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was between $1,650,000,00 + GST and $1,720,000,00 + GST.

5.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was $1,9715,516.62 (inclusive of GST),

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was $1,9715,516.62 + GST.

6.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was between $1,950,000.00 (inclusive of GST) and $1,990,000.00 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was between $1,950,000,00 + GST and $1,990,000.00 + GST.

7.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551} for and in respect of the project at. the Blake Street Property was $1,930,539,62 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 138 639 551) for and in respect of the project at the Blake Street Property was $1,930,539.62 +GST, 

8.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was between $1,900,000.00 (inclusive of GST) and $1,950,000.00 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property was between $1,900,000.00 + GST and $1,950,000.00 + GST.

9.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property did not exceed $2,000-000.00 (inclusive of GST).

(a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the project at the Blake Street Property did not exceed $2,000,000.00 + GST.

10.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the home warranty insurance in respect of project at the Blake Street Property was $33,158.48 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the home warranty insurance in respect of project at the Blake Street Property was $33,158.48 + GST,

11.   Included in the amount of the preliminaries shown as $88,299.37 on the Building Payments Summary (as identified below) is the sum of $322.63 for a printer cartridge and mem sticks.

12.   Included in the amount of the preliminaries shown as $88,299.37 on the Building Payments Summary (as identified below) is the sum of $2,007.99for a computer.

13.   (a) The amount of money to paid the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for project management fees in respect of the project at the Blake Street Property was not less than $64,000.00 (inclusive of GST).

(b) The amount of money to paid the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for project management fees in respect of the project at the Blake Street Property was not less than $64,000.00 (inclusive of GST).

14.   (a) The amount of money paid to the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for site management fees in respect of the project at the Blake Street Property was not less than $40,000,00 (inclusive of GST).

(b) The amount of money paid to the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for site management fees in respect of the project at the Blake Street Property was not less than $40,000.00 + GST,

15.   (a) The amount of money paid to the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for wages in respect of the project at the Blake Street Property was not less than $100,000.00 (inclusive of GST),

(a)   The amount of money paid to the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for wages in respect of the project at the Blake Street Property was not less than $100,000.00 + GST.

16.   (a) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the swimming pool at the Blake Street Property was S112,505.00 (inclusive of GST).

(b) The amount of money expended by or on behalf of the Defendants or either of them and/or any entity associated with the Defendants or either of them (including Nagrommada Tech Pty Limited (ACN 136 639 551) for and in respect of the swimming pool at the Blake Street Property was $112,505.00 + GST.

The Plaintiff requires you to admit the authenticity of the following documents:

1.   The document annexed hereto and marked “A” (hereinbefore, for convenience only, referred to as "Building Payments Summary”)

39. In Rogers v The Queen (1994) 181 CLR 251; [1994] HCA 42, McHugh J said (at 286):

16. Inherent in every court of justice is the power to prevent its procedures being abused (Hunter v. Chief Constable of the West Midlands Police [1981] UKHL 13; (1982) AC 529 at 536.). Although the categories of abuse of procedure remain open, abuses of procedure usually fall into one of three categories:

(1)   the court's procedures are invoked for an illegitimate purpose;

(2)   the use of the court's procedures is unjustifiably oppressive to one of the parties; or

(3)   the use of the court's procedures would bring the administration of justice into disrepute.

Many, perhaps the majority of, cases of abuse of procedure arise from the institution of proceedings. But any procedural step in the course of proceedings that have been properly instituted is capable of being an abuse of the court's process. In Walton v. Gardiner ((1992) 177 CLR 378 at 393.), Mason CJ, Deane and Dawson JJ said that the jurisdiction to stay proceedings that are an abuse of process "extends to all those cases in which the processes and procedures of the court, which exist to administer justice with fairness and impartiality, may be converted into instruments of injustice or unfairness". …

40. In Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; [2006] HCA 27 the plurality judgment said at [9] that the categories for abuse of process are not closed. The judgment affirmed what McHugh J had said in Rogers concerning the usual categories of abuse of process, and reaffirmed his view that any procedural step in the course of proceedings that have been properly instituted is capable of being an abuse of the Court’s process. There is no doubt that a Notice to Admit Facts can be set aside on the basis that it is oppressive and/or an abuse of process: Gerard Michael McGuirk v The University of New South Wales [2009] NSWSC 253; Parkesbourne Mummel Landscape Guardians Inc v Minister for Planning [2009] NSWLEC 101 at [6] and [11]-[14].

41. In my opinion, a requirement by the plaintiff for the defendants to admit paragraphs 1 to 9 and 13 to 16 is unfairly oppressive to the defendants. If there is a failure to deny any or all of those paragraphs within the 14 day period (as there was here), the effect will be that there is a deemed admission of all of the 18 matters. As between each part of each paragraph there is a fundamental inconsistency (an admission of an amount inclusive of GST and at the same time an admission of an amount plus GST). Further, there would be inconsistent admissions of each of the amounts contained in paragraphs 1 to 8, even if an admission of either paragraph 9(a) or 9(b) was thought not to be inconsistent with any one of the earlier paragraphs. It would be unfairly oppressive to the defendants to have made such inconsistent admissions enabling the plaintiff to take whichever is most advantageous for him as the basis for any future calculations.

42. It seems to me that it is not appropriate for a party to require a cascading list of admissions, rather in the manner that might be inserted in a Restraint of Trade Agreement.

43. The only evidence available at the hearing of the notice of motion that might be thought to justify any of the amounts contained in paragraphs 1 to 9 of the Notice, was the landscape printout of a document accessed with the consent of the second defendant by the plaintiff from the second defendant’s Dropbox. That document became exhibit 2. It identifies that the total amount expended by or on behalf of the defendants was $1,733,516.62. The amount inserted in paragraph 1 of the Notice appears to have been a typographical error. No other basis was shown to justify the selection of the alternative figures contained in paragraphs 2 to 9.

44. In my opinion, for those reasons, paragraphs 1 to 19 and 13 to 16 of the Notice should be set aside as amounting to an abuse of process.

Other arguments by the defendants

45. Although not strictly necessary to do so, I will briefly deal with other submissions put by the defendants as a basis for setting aside the Notice.

46. It was suggested that paragraphs 11 and 12 of the Notice seek an opinion or asked the defendants to agree with a submission or opinion of the plaintiff. I do not agree. The starting point for this, and a number of other objections, was a submission that the document annexed to the Notice to Admit was the plaintiff’s document. The document annexed was the first page of the printout obtained by the plaintiff from the second defendant’s Dropbox with the second defendant’s permission.

47. Annexure AA to the plaintiff’s affidavit is an email from Morgan Projects to the plaintiff dated 23 July 2016. The evidence discloses that Morgan Projects is a business name owned by Nagrommada Tech Pty Limited. The second defendant is the sole director and shareholder of that company.

48. The email reads:

Michael,

See attached drop box link to Blake Street, “master file”. This is for your reference only, please do not distribute master link to any subbies/suppliers, as all fee proposals and other personal info is accessible via this link.

…

I will continue to update/manage this folder moving forward, have a look in the meantime and let me know if you require assistance with anything… cheers

The link to the Dropbox was then given. What became exhibit 2 was the document accessible via the Dropbox link. It was the first page of that document that was annexed to the Notice to Admit. That first page was the summary apparently of building costs incurred which totalled $1,733,516.62. The pages which followed contained the breakdown of those figures.

49. The definition of “document” in Pt 1 of the Dictionary in Sch 2 to the Evidence Act 1995 (NSW) is as follows:

document means any record of information, and includes -

(a) anything on which there is writing, or

(b) anything on which there are marks, figures, symbols or perforations having a meaning for persons qualified to interpret them, or

(c) anything from which sounds, images or writings can be reproduced with or without the aid of anything else, or

(d) a map, plan, drawing or photograph.

Note -

See also clause 8 of Part 2 of this Dictionary on the meaning of “document”.

50. In addition, cl 8 of Pt 2 of the Dictionary provides:

8 References to documents

A reference in this Act to a document includes a reference to -

(a) any part of the document, or

(b) any copy, reproduction or duplicate of the document or of any part of the document, or

(c) any part of such a copy, reproduction or duplicate.

51. Sections 47 and 48 of the Evidence Act relevantly provide:

47 Definitions

(1) A reference in this Part to a document in question is a reference to a document as to the contents of which it is sought to adduce evidence.

(2) A reference in this Part to a copy of a document in question includes a reference to a document that is not an exact copy of the document in question but that is identical to the document in question in all relevant respects.

48 Proof of contents of documents

(1) A party may adduce evidence of the contents of a document in question by tendering the document in question or by any one or more of the following methods -

(a) adducing evidence of an admission made by another party to the proceeding as to the contents of the document in question,

(b) tendering a document that -

(i) is or purports to be a copy of the document in question, and

(ii) has been produced, or purports to have been produced, by a device that reproduces the contents of documents,

(c) …

(d) if the document in question is an article or thing on or in which information is stored in such a way that it cannot be used by the court unless a device is used to retrieve, produce or collate it - tendering a document that was or purports to have been produced by use of the device,

52. Those definitions make clear, if there were any doubt about the matter, that the document being annexure “A” to the Notice and exhibit 2 is not the plaintiff’s document but is the second defendant’s document. The fact that the plaintiff downloaded, copied or printed what he accessed from the second defendant’s Dropbox does not change that fact.

53. Paragraphs 11 and 12 are seeking admissions of fact only about the second defendant’s document. There is nothing irregular or improper about that.

54. The defendants assert also that the Notice to Admit seeks an admission from a non-party, being Nagrommada Tech Pty Limited. It is apparent from the face of the Notice, which is addressed only to the first and second defendants, that no admission is being sought from a third party. To the extent that the Notice seeks admissions in relation to, rather than from, Nagrommada Tech Pty Limited, the evidence shows that the second defendant is the sole owner and director of that company.

55. The defendants submitted that it is irregular to serve a Notice to Admit Facts prior to pleadings being closed. Reliance was placed on my decision in Edwards v The State of New South Wales [2017] NSWSC 459.

56. It is clear that the pleadings in this matter closed 14 days after the service of the defence to the cross-claim. That defence was filed on 9 April 2020. The defendants, as I have noted, intend to seek leave to file an amended cross-claim. That in itself does not mean that pleadings have not already closed. What is of greater importance is that at the time the Notice was served the pleadings had closed, and there was no application extant by the defendants to file an amended pleading.

57. The defendants argued that it was not appropriate for the plaintiff to seek an admission as to the authenticity of the document annexed to the Notice on the basis that the document is the plaintiff’s document. For reasons given earlier, the document was the defendants’ document. There was nothing improper about the plaintiff seeking an admission that the document was an authentic document.

58. The defendants sought alternatively that they should be permitted to withdraw the admissions if they were found to have been made. No evidentiary basis was shown for giving leave for the withdrawal of the admissions, even in the circumstances where I have accepted that the document did not come to the attention of the solicitors because the email was overlooked. What is contained in the document, exhibit 2, points to the correctness of what the Notice seeks to have admitted in paragraph 1(a), subject only to the apparent typographical error in relation to the amount. There is no evidence from the second defendant to explain why the deemed admission of paragraph 1(a) was not correctly made: see the discussion in Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738 at 746-749.

Procedural matters

59. At the outset of the hearing of the notice of motion, Mr Gruzman informed me that a further notice of motion to set aside another notice to admit facts had been filed and served by the defendants. He said that he was ready to deal with that motion also. Mr Fozzard of counsel for the defendants said that he could probably deal with that motion, although he had not expected it would be heard with the motion set down for hearing on 3 March.

60. The further notice of motion was returnable on 9 March 2021. In the circumstances, I determined that it should not be heard with the motion for hearing on 3 March 2021. I considered that it was necessary for a decision to be reached first on the Notice dated 20 October 2020. The reasons I have given in this judgment may assist in determining whether or not the further notice of motion is pursued.

61. Mr Gruzman sought that following delivery of this judgment the proceedings should be returned to the Real Property List in the Equity Division.

62. The proceedings commenced in the Possession List of the Common Law Division. The court file discloses that the proceedings have never been in the Real Property List. The only document that is entitled in the Equity Division Real Property List was the Notice served by the plaintiff. That was an error. No order was made transferring the proceedings to the Equity Division.

63. The proceedings no longer seek possession of land. The claim is a monetary claim based on an agreement pursuant to a joint venture between the parties. In those circumstances, the proceedings should be removed from the Possession List. The effect of that order will be that the proceedings will be case-managed in the general list in the Division subject to Practice Note SC CL 1.

64. I make the following orders:

1. I set aside the Notice to Admit Facts dated 20 October 2020.

2. The plaintiff is to pay the defendants’ costs of the notice of motion.

3. The proceedings are removed from the Possession List.

4. The defendants’ notice of motion filed 2 March 2021 and the proceedings generally are stood into the Registrar’s list on 19 March 2021.

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Decision last updated: 12 March 2021