Poulos v Tzavellas

[2015] NSWSC 1703

Supreme Court

New South Wales

Medium Neutral Citation:	Poulos v Tzavellas [2015] NSWSC 1703
Hearing dates:	16 November 2015
Date of orders:	16 November 2015
Decision date:	16 November 2015
Jurisdiction:	Common Law
Before:	Davies J
Decision:	1. Extend time for Defendants to file and serve the proposed cross-claim to close of business on 23 November 2015 failing which the defence filed 2 October 2015 is struck out and the Plaintiff granted leave to move for default judgment. 2. If no cross-claim is filed and served by 23 November 2015 the Defendant is not permitted to file any further defence or cross-claim without a Motion seeking leave to do so. 3. If the proposed cross-claim is filed by 23 November 2015, the Plaintiff is to file and serve a defence to that cross-claim by 7 December 2015. In those circumstances the proceedings are listed for Directions before Davies J at 9:30am on 11 December 2015. 4. Parties granted liberty to apply on 2 days’ notice to Associate.
Catchwords:	REAL PROPERTY – possession of land – defence not disclosing any defence to the claim – reliance on cross-claim - failure to file cross-claim within time directed – claimed inability to pay filing fees – extension of time granted – if cross-claim not filed by extended date defence struck out
Legislation Cited:	Contracts Review Act 1980 (NSW)
Category:	Procedural and other rulings
Parties:	Frank Fotis Poulos (First Plaintiff) Joy Poulos (Second Plaintiff) F Poulos Enterprises Pty Ltd (Third Plaintiff) Spiros Tzavellas (First Defendant) Carlie Tzavellas (Second Defendant)
Representation:	Counsel: B Nolan (Plaintiffs) J Xenos (Defendants)   Solicitors: JHK Legal (Plaintiffs) PJG Solicitors (Defendants)
File Number(s):	2015/17317

Judgment

1. These proceedings commenced on 19 January 2015 where the Commonwealth Bank of Australia sought judgments for monetary sums against a number of guarantors. Three of the guarantors entered into an arrangement with the bank with the result that they were substituted as Plaintiffs against the remaining guarantors seeking contribution in respect of the guarantees that had been given to the bank.

2. An Amended Statement of Claim was filed by those guarantors who had entered into the arrangement with the bank on 13 August 2015. A Defence was filed by those against whom the proceedings were still brought on 2 October 2015. That Defence does not, on its face, disclose any defence to the claim being made by those guarantors who entered into an arrangement with the bank.

3. The matter came before a Registrar on 6 October 2015 and the Registrar ordered that the Defendants were to file and serve an affidavit explaining why a cross-claim that they had indicated they wanted to bring was not filed with the Defence. The Registrar directed that the affidavit was to annex the draft cross-claim. That was to be done by 8 October 2015.

4. When the matter came before me on 9 October for judicial directions Mr Xenos, the solicitor for the Defendants, read an affidavit that he had sworn explaining why the cross-claim had not been filed with the Defence. That affidavit was directed principally to ill health issues that Mr Xenos had suffered which he said prevented that cross-claim being prepared. A draft form of the cross-claim was annexed to his affidavit. The cross-claim pleaded the Contracts Review Act1980 (NSW) in relation to the entry into the original guarantee with the bank.

5. Mr Xenos explained to me on 9 October that he wished to have counsel settle the form of the cross-claim. To that end, I gave him until 23 October for the Defendants to file and serve the proposed cross-claim. I directed that any defence to that cross-claim was to be filed by 6 November, and the matter was adjourned to today.

6. No form of the cross-claim has been filed and Mr Xenos has informed me that the reason for that is that the Defendants do not have the funds to pay the filing fee for the cross-claim. He said also that he has not been able to brief counsel because he insists that clients put him in funds before counsel is briefed, and they had not done so.

7. There is no reason, on the face of the draft cross-claim, why that document could not be filed without the matter further being looked at by counsel, at least at this stage of the proceedings. It properly pleads the matters sought to be relied upon by the Defendants.

8. As unfortunate as it is that the Defendants may not have the filing fee, that cannot be allowed to hold up the proceedings in the circumstances where the present Plaintiffs have made an arrangement with the bank and are now entitled to their contribution from the Defendants.

9. The Defendants should be given a further short period of time in which to file the cross-claim either by payment of the filing fee or by arranging for a waiver or postponement of those fees with the Court Registry. If by the date I stipulate the cross-claim is not filed, the Defendants will not thereafter be allowed to file the cross-claim, and the defence that has presently been filed will be ordered to be struck out as not disclosing any defence to the claim. In those circumstances the Plaintiffs will be entitled to move for default judgment and the Defendants would need in a substantive Motion to justify why that judgment should be set aside and why they should thereafter be allowed to file any further defence or cross-claim.

10. The orders that I make therefore are these.

1. Extend the time for the Defendants to file and serve the proposed cross-claim by close of business on 23 November 2015. If no such cross-claim has been filed by that date, the Defence filed 2 October 2015 is struck out.

2. If no cross-claim is filed and served by 23 November 2015 the Defendants are not permitted, after that time, to file any further defence or cross-claim without a Motion seeking leave to do so.

3. If the cross-claim is filed by 23 November 2015, direct any defence to the cross-claim to be filed and served by 7 December 2015.

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Decision last updated: 17 November 2015