QBE Insurance Ltd v DARMOKO

[2001] WADC 61

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION:   PERTH

CITATION:   QBE INSURANCE LTD -v- DARMOKO [2001] WADC 61

CORAM:   NISBET DCJ

HEARD:   9 FEBRUARY 2000

DELIVERED          :   15 MARCH 2001

FILE NO/S:   CIV 463 of 2000

BETWEEN:   QBE INSURANCE LTD

Plaintiff

AND

ANDREW ARIEF DARMOKO
Defendant

Catchwords:

Appeal from Registrar - Practice and procedure - Setting aside writ of summons - Whether writ regularly issued - Power to correct defect or irregularity

Legislation:

Nil

Result:

Appeal dismissed

Representation:

Counsel:

Plaintiff:     Mr A N Siopis

Defendant:     Mr D E Eley

Solicitors:

Plaintiff:     Jackson McDonald

Defendant:     Eley Palmer Archer

Case(s) referred to in judgment(s):

Golden Ocean Assurance Ltd and World Mariner Shipping SA v Martin & Ors ("The Goldean Mariner") [1990] 2 Lloyds Rep 215

Hazart Pty Ltd v Rademaker (1993) 11 WAR 26

Hughes v National Trustees Executors and Agency Co of Australasia Ltd [1978] VR 257

Pollard v Incorporated Nominal Defendant [1972] VR 955

Ratnam v Cumarasamy [1965] 1 WLR 8

Case(s) also cited:

BP Australia Ltd v Kirki Shipping Corporation & Anor, unreported; SCt of WA; Library No 940612; 1 November 1994

Caltex Oil (Australia) Pty Ltd v The Dredge "Willemstad" (1976) 136 CLR 529

Laurie v Carroll (1957-1958) 98 CLR 310

Newcombe v AME Properties Ltd & Anor (1995) 14 WAR 259

Pountney v Griffiths [1976] AC 314

Rothmans of Pall Mall (Overseas) Ltd & Ors v Saudi Arabian Airlines Corporation [1981] QB 368

1. NISBET DCJ: On 22 February 2000 the plaintiff issued a writ of summons out of this Court against the defendant claiming $75,000 for breach of contract and fraudulent misrepresentation arising out of a claim made by the defendant as a director of Alcaston Nominees Pty Ltd in respect of a claim it made against a policy of insurance it held with the plaintiff in respect of a fire which occurred on 7 November 1999. Whilst the claim was endorsed on the writ and should have been for damages and not the liquidated sum claimed, it otherwise appears to have been regularly issued out of the court. It was addressed to the defendant at 39 Sattleberg Ramble, Dianella in the State of Western Australia. At the time the writ was issued, however, the plaintiff knew that the defendant was not then resident in Western Australia but was in fact believed to be resident in Indonesia and that the Western Australian Police had issued a warrant for his arrest. The evidence of this knowledge of the plaintiff comes from the affidavit of the plaintiff's solicitor, sworn 2 March 2000. That affidavit was sworn in support of an application by summons to chambers for leave to serve notice of the writ out of the jurisdiction of this Court pursuant to the provisions of O 10 r 1 of the Rules of the Supreme Court.  That application was granted by order of a Registrar of this Court made 21 March 2000.  On 29 March 2000 the plaintiff applied, again by summons to chambers supported by an affidavit, for an order for substituted service of the writ of summons, and not, it should be noted, of the notice of the writ.  An order was made granting this application on 31 March 2000 again by a Registrar of this Court which order provided that personal service of the writ of summons on the defendant be dispensed with and that "substituted service may be effected by serving the writ of summons in this matter together with a copy of this order, on the defendant's solicitor, Mr Ben Morton of Messrs Eley Palmer Archer, Ground Floor, 640 Murray Street, West Perth  WA  6005."

2. Next, on 17 April 2000 the defendant filed a conditional memorandum of appearance thereby bringing into operation O 12 r 6(2) of the Rules of the Supreme Court which provides:

   "The defendant shall forthwith apply to the Court to have the question raised by his conditional appearance decided, and if such an application is not made within 14 days from the entry of the conditional appearance, or if the application be dismissed, the conditional appearance shall, unless the court otherwise orders, become and operate as an unconditional appearance."

3. The defendant did nothing however until 12 June 2000 when he applied by summons to chambers pursuant to O12 r 6 for orders that:

   "1.Pursuant to O 3 r 5 of the Rules of the Supreme Court the defendant have leave to bring this application out of time.

   2.The plaintiff's writ of summons be set aside because of

   (a)the plaintiff's failure, pursuant to O 5 r 9 of the Rules of the Supreme Court, to obtain leave to issue the writ of summons, notice of which was to be served out of the jurisdiction; and

   (b)the plaintiff's failure, pursuant to O 10 r 1 of the Rules of the Supreme Court to, to obtain leave to serve notice of the writ of summons out of the jurisdiction (sic)."

4. Presumably by way of response to the defendant's application the plaintiff brought in an application dated 20 June 2000 by way of summons to chambers seeking orders in the following terms:

   "1.The plaintiff have leave to issue the writ of summons for service outside of the jurisdiction pursuant to O 5 r 9 of the Rules of the Supreme Court.

   2.That the grant of leave be retrospective to the date of the issue of the writ, or 22 February 2000."

5. On 17 August 2000 the plaintiff's solicitor, Ms McLennan, swore an affidavit comprising some 82 pages which was filed in the court on 18 August 2000 in opposition to the defendant's application for an extension of time within which to challenge the validity of the writ pursuant to the provisions of O 12 r 6 of the Rules of the Supreme Court. Each of the applications of the defendant and plaintiff came on for hearing before a Deputy Registrar of the court on 29 August 2000 and the Registrar delivered written reasons for his decision in the matter on 27 September 2000 (see [2000] WADC 237). In essence the Deputy Registrar decided that on the most generous interpretation of the Rules the defendant was 41 days late in bringing his application for an extension of time in which to challenge the validity of the writ pursuant to the provisions of O 12 r 6 and that on a better reading of the Rules he was 55 days out of time and, having failed to explain either period at all or even attempting to explain his delay, he refused to grant the extension of time within which to bring the application and dismissed the defendant's application. Likewise he dismissed the plaintiff's application on the ground that it was unnecessary having regard to his decision on the defendant's application for an extension of time.

6. By notice filed 3 October 2000 the defendant appealed against the Deputy Registrar's decision and it was this matter that came on for hearing before me in chambers on 9 February last.

7. As is now well enough known, an appeal from a Registrar to a Judge in the District Court is by way of re‑hearing:  Hazart Pty Ltd v Rademaker (1993) 11 WAR 26. An application for an extension of time calls for the exercise of a discretion and ordinarily one would expect to see some explanation for the delay which has necessitated the application for the enlargement of time. This is because a party does not have a right to an extension of time: Pollard v Incorporated Nominal Defendant [1972] VR 955 (and see also Ratnam v Cumarasamy [1965] 1 WLR 8 at 12).  Generally speaking the sole criterion for deciding applications for an extension of time is:  What is required in the interests of justice?:  Hughes v National Trustees Executors and Agency Co of Australasia Ltd [1978] VR 257 at 262 ‑ 264.

8. As I am hearing this matter de novo, a review of the affidavit material on the court file still provides no explanation for the defendant's delay. I should point out too that this is no ordinary delay. Order 12 r 6(2) is cast in imperative terms: "The defendant shall forthwith … etc" hence justifying the Registrar's finding that the true delay here was 55 days and not 41. When there is a question going to the essential validity of the proceedings it is indeed imperative that such questions be clarified immediately. There are very good reasons for this. Litigation is always expensive but it becomes even more so if it is to be fruitless as well.

9. Turning my attention now to the justice of the matter it seems to me that this is a case which calls for a close consideration of the application of the remedial process envisaged by O 2 r 1 and r 2 of the Rules of the Supreme Court.  This is because in my opinion firstly, had the plaintiff adopted the correct procedure it would undoubtedly have been given leave to issue notice of the writ out of the jurisdiction.  Further, having regard to the facts and matters disclosed in Ms McLennan's affidavit I think it highly likely that the plaintiff would have been granted an order for substituted service of the notice and of the writ upon the defendant's solicitors within the jurisdiction.  What point would there be then in bringing these proceedings to an end and obliging the plaintiff to commence them again?  There is no reason that has been argued before me why this should occur.  The defendant's counsel admitted that the plaintiff's cause of action would still be alive, there was no limitation point or other issue which would disentitle the plaintiff to commence fresh proceedings and in my opinion to force the plaintiff to start again would make a mockery of the law; it would demonstrate that the law is more concerned with form than substance.  In this regard therefore the nature of the irregularity pressed by the defendant needs to be examined carefully in order that it might be determined if it is indeed a question merely of form and not of substance and in this regard there is clear and compelling authority to show that it is indeed a matter of form:  Golden Ocean Assurance Ltd and World Mariner Shipping SA v Martin & Ors("The Goldean Mariner") [1990] 2 Lloyds Rep 215 per Sir John Magaw at 225:

   "The wording of O 2 r 1 [of the English Rules] is, no doubt intentionally, expressed in the widest possible terms. It is useful and illuminating to go through sub‑rule (1) phrase by phrase. What emerges is the scrupulous care which has been taken in drafting, in order to defeat the possibility of exercises in forensic ingenuity which would bring back the rejected concept of a procedural error resulting necessarily and automatically in the proceedings being void ab initio. It is, in my opinion, not possible, while giving their clear meaning and intention to the words used in the sub‑rule, to challenge the accuracy of the summary of the effect of the new rule as expressed by Lord Denning MR in Harkness v Bell's Asbestos & Engineering Ltd [1967] 2 QB 729 at p 735:

   'This new rule does away with the old distinction between nullities and irregularities.  Every omission or mistake in practice or procedure is henceforth to be regarded as an irregularity which the court can and should rectify so long as it can do so without prejudice.'

   I find nothing in the later authorities cited to us which leads me to the conclusion that the summary of the effect of the new rule is wrong. Of course, the new rule does not prevent the Court from deciding that justice requires that defective proceedings should be set aside, with the same consequences as would be followed under the old procedure, in a case where the proceedings were treated as falling within one of the classes of nullities. The difference is that now the Court is required to apply (as I should have thought it would normally wish to apply) its view as to what is just and expedient in the particular circumstances of the particular case, and, under O 2 r 1, to make such order as is appropriate on that basis.

   There is nothing, in the circumstances of the procedural failures with which we are here concerned, which takes those failures outside the purview of O 2 r 1.

   …

   In Leal v Dunlop Bio‑Processes International Ltd [1984] 1 WLR 874 the failure had been that the plaintiffs had not sought nor obtained leave under O 6 r 7 to issue the writ or under O 11 r 1 to serve it out of the jurisdiction. That, in my view, was a substantially worse irregularity, from the point of view of the exercise of the Court's discretion, than the failure in the present case.

   However that may be, the Judge of first instance in Leal v Dunlop had held, first, that the Court did not have any discretion under O 2 r 1 to permit that irregularity to be remedied; but also, and alternatively, that, if there was a discretion, the Court ought not to exercise it in favour of the plaintiffs on the facts of the case. Lord Justice Stephenson, giving the leading judgment on the appeal to this Court, held that there was, indeed, jurisdiction under O 2 r 1. But he further said (at p 881H) in relation to the Judge's finding that, if there were a discretion, he would not exercise it in favour of the plaintiffs as follows:

   'I am not satisfied that the judge's decision was wrong.  I am not sure that I should have made the same decision myself, but I probably would and that anyhow is not the question raised by an appeal of this kind.'

   I should have though that it would be, at least, more doubtful whether Lord Justice Stephenson would himself have exercised the discretion to refuse to give relief in respect of the irregularity in the present case, if the present facts had been before him."

10. In my judgment accordingly there is high authority, strongly persuasive, that the provisions of O 2 r 1 may be used in a circumstance such as this and in that event I see no utility whatever in terminating the proceedings and having the plaintiff begin them afresh. The appeal will be dismissed.