Portbury Development Co Pty Ltd v Mackali
[2011] VSC 81
•3 March 2011
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
No. SCI 2009 of 05761
| PORTBURY DEVELOPMENT CO PTY LTD (ACN 065 713 760) | Plaintiff |
| v | |
| NEJAT MACKALI | Defendant |
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JUDGE: | KAYE J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 3 March 2011 | |
DATE OF RULING: | 3 March 2011 | |
CASE MAY BE CITED AS: | Portbury Development Co Pty Ltd v Mackali | |
MEDIUM NEUTRAL CITATION: | [2011] VSC 81 | |
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PRACTICE – Trial – Adjournment – Defendant applying for adjournment after close of plaintiff’s case – Defendant wishing to access expert evidence – Previous orders for exchange of expert reports not complied with by defendant – Application refused.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D Klempfner | Nicholas O’Donohue & Co |
| For the Defendant | The defendant appeared in person |
HIS HONOUR:
In this proceeding the plaintiff claims damages arising out of the breach by the defendant of a contract of sale of a property in Avenel in July 2008. In that contract the plaintiff was the vendor. The contract was rescinded upon the breach by the defendant in January 2009.
In the proceedings, the plaintiff claims damages including inter alia the difference between the contract price and the value of the property in February 2009. In its statement of claim, the plaintiff has pleaded that the property as at 20 February 2009 was valued at $940,000. That value is based on a valuation by Mr Falvo of Global Estates Pty Ltd of that date.
The case had been twice set down for trial before it came on on this date. Those trial dates on each time had been vacated. Today, Mr Klempfner of counsel appeared on behalf of the plaintiff, and the defendant, Mr Mackali, has appeared unrepresented for himself. He had previously been represented by a firm of solicitors in this matter, but they had withdrawn from acting for him in May 2010.
After opening the case, Mr Klempfner called two witnesses, the first of whom was Mr Falvo. Mr Falvo was cross-examined by Mr Mackali, and if I may say so, the cross-examination indicated that Mr Mackali had a good grasp of the issues which were at large in this case, and he cross-examined with some skill. At the close of the plaintiff's case, I pointed out to Mr Mackali that he then had the opportunity to present evidence on his behalf. At that point it emerged that he wished to have some expert evidence made available to meet some of the calculations made by Mr Falvo in his report.
He has therefore applied for an adjournment, so that he could obtain that expert evidence. That application has been opposed by Mr Klempfner. In essence, Mr Falvo's valuation proceeds by way of a hypothetical development approach. In the written valuation which he affirmed in his evidence in this case, he postulated a subdivision of the subject land into 82 lots, and he provided for a sale price of each lot and a development price cost of each lot. He factored in expected profit risk and the selling costs, and on that basis came to an overall valuation of $940,000.
In cross-examination by Mr Mackali he in fact preferred a subdivision based on some 30 lots, but he came broadly to the same conclusion, on the basis that, by doing so, while the sale price would be reduced, the development costs equally would be reduced.
Part of Mr Mackali's cross-examination focussed on the development costs, and as I understand it, he wishes now to seek expert advice concerning those proposed development costs.
Mr Klempfner has opposed the application on two main bases. Firstly, he has submitted that the defendant has had more than adequate opportunity to prepare the evidence, which he now wishes to try to obtain upon the grant of an adjournment to him. And, secondly, he has submitted that the plaintiff would suffer prejudice should I adjourn the case. In particular he submitted that the plaintiff would incur further costs, and that any costs order made in its favour would be unlikely to be satisfied by payment by the defendant.
In respect of the first submission made by Mr Klempfner it is necessary to refer in a little detail to the history of this proceeding. The action was issued on 2 April 2009. In the statement of claim the plaintiff specifically pleaded that the property was valued as at 20 February 2009 at $940,000. In August 2009 the plaintiff issued a summons for summary judgment. An affidavit sworn in support of that application exhibited, inter alia, Mr Falvo's valuation.
Thus, at least 18 months, ago the defendant has been made fully cognisant of the fact that the plaintiff would be relying on the valuation by Mr Falvo. He was also fully aware of the methodology adopted by Mr Falvo in performing that valuation. In October 2009 Associate Justice Mukhtar made an order requiring each side to exchange expert reports by 30 November 2009. On 11 March 2010 His Honour made a further order extending the time for exchange of those expert reports to 30 April 2010.
I interpolate that, by that time mediation had already been conducted on 24 February 2010, and at that stage in the proceedings the defendant was still represented by solicitors. Indeed his defence and amended defence had each been prepared on his behalf by counsel. In those circumstances it is clear, it seems to me, that the defendant has been fully aware throughout the proceeding of the manner by which the plaintiff has proposed to prove the major aspect of its damage claim. Through a large part of that period, the defendant has had available to him legal advice which would, it would seem to me, of necessity have made him aware that, if he wished to challenge Mr Falvo's opinion or any aspect of it, he would need to seek and obtain appropriate expert evidence himself.
The case in due course was set down for trial on 16 November 2010, but on that date Associate Justice Daly made an order vacating the trial date and refixing the trial for 17 February this year.
By that order, Her Honour directed that any expert evidence upon which the defendant wish to rely was to be filed and served by 21 January 2011. Mr Mackali was present when those orders were made, and Mr Klempfner advises me that the order was made in response to an application by him.
That order was not complied with, and for unrelated reasons as I understand it, the trial date in February was vacated and the trial was fixed to commence on this day.
In those circumstances, it seems to me clear that the defendant has had substantial opportunity to understand the manner in which the plaintiff has sought to claim damages and prove that claim for damages against him. He has also been well and truly aware of the need for him to properly prepare an answer to that claim, and in particular to address the underlying assumptions contained in the methodology utilised by Mr Falvo.
In those circumstances, in my view, Mr Klempfner is on sound ground in submitting that it would not be unfair to the defendant to refuse the defendant's application for an adjournment to enable him at this very late stage to prepare further evidence.
When I questioned Mr Mackali as to why this had not previously been done, Mr Mackali did refer to the fact that on the last occasion he had intended to obtain any expert advice, but that in the meantime a property owned by him in Mooroopna had burnt down and that had distracted him and also had prevented him from putting together the funds with which to seek expert opinion.
It seems from what he has told me today, however that he would still be able to get that expert opinion without the requisite funds. He has also told me, although I consider he is being far too optimistic in doing so, that the material he wishes to obtain could be obtained in a fairly short time span.
All that means is that in fact Mr Mackali could have got this evidence together at a much earlier stage and certainly well before today's hearing. I am mindful of the fact that Mr Mackali is unrepresented and that is a matter which has given me pause. Indeed, in hearing argument, I remarked that if Mr Mackali was represented, his application today would be given quite short shrift indeed.
On the other hand, I have been anxious to ensure that he receive a fair trial of what is a substantial claim against him. However, I am concerned that this piece of litigation has now proceeded for some time, that Mr Mackali did not seek an adjournment when the case came before me this morning, and that the plaintiff has now put on its proof and has expended money in doing so.
If I was to allow an adjournment, the plaintiff would need to come back, and possibly recall further witnesses and incur expense. That then brings me to the second basis upon which the application for an adjournment has been opposed.
It has been pointed out to me that, as part of the orders made on 16 November 2010, Associate Justice Daly ordered that the defendant pay the plaintiff's costs thrown away by reason of the adjournment. Those costs were subsequently fixed by order of Her Honour, and have not been paid.
Based on what Mr Mackali has said to me today, I have little confidence if I was to make an order in favour of the plaintiff for costs thrown away by any adjournment today, that those costs would be paid. Indeed, Mr Mackali has frankly told me that if I was to make such an order he would need some time to pay it.
Thus, if I were to adjourn the trial it would not only disrupt the business of this court, it would put the plaintiff to the inconvenience of having to come back again. But more importantly the plaintiff would incur financial costs, which it would seem to me are unlikely to be recompensed by way of an order for costs in its favour, should I make one.
Ultimately, the test is one of where the justice in the situation lies, and I have given this matter anxious consideration. However, it seems to me that at this stage the defendant has had ample and more opportunity to have the evidence prepared. Secondly, the plaintiff would suffer prejudice for which it could not be compensated.
Thirdly, the business of the court would be disrupted should I allow such an adjournment. Fourthly, if I were to allow the adjournment, notwithstanding what Mr Mackali has put to me, I do not have sufficient assurance that any further evidence to be obtained by Mr Mackali would either be of assistance or would be available within a short time frame.
Based on each of those reasons separately and collectively I therefore, although with some regret, reject Mr Mackali's application today for an adjournment.
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