Restifo v W H Milne Properties Pty Ltd - [2004] WADC 75

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: RESTIFO -v- W H MILNE PROPERTIES PTY LTD [2004] WADC 75

CORAM: COMMISSIONER GREAVES

HEARD: 19 FEBRUARY 2004

DELIVERED : 23 APRIL 2004

FILE NO/S: CIV 1093 of 2001

BETWEEN: PHILIP SANDY RESTIFO
Plaintiff (Respondent)
AND
W H MILNE PROPERTIES PTY LTD
Defendant (Appellant)

Catchwords:

Procedure - Appeal from Deputy Registrar - Application to set aside default judgment - Whether defendant in possession at date of plaintiff's accident - Real prospect of success demonstrated by defendant if evidence accepted at trial

Legislation:

Occupiers' Liability Act 1995

Result:

Appeal allowed
Judgment set aside
Leave to defend granted

Representation:

Counsel:

Plaintiff (Respondent) : Mr J R Criddle
Defendant (Appellant) : Mr S Penglis

Solicitors:

Plaintiff (Respondent) : Bradford & Co
Defendant (Appellant) : Freehills

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

Lovell v Western Australian Police Union & Anor, unreported; SCt of WA; Library No 930387; 30 June 1993

Case(s) also cited:

Crayden as Executor of the Estate of Sandra Irene Farnworth v Ottaviano & Anor; [2003] WASCA 20
Jones v Bartlett (2000) 205 CLR 166
Kostokanellis v Allen [1974] VR 596
National Australia Bank Ltd v Singh [1995] 1 Qd R 377
Palmer v Prince [1980] WAR 61
Parker v Transfield Pty Ltd & Anor [2000] WASCA 382
Radaich v Smith & Anor (1959) 101 CLR 209
Rolland, Re; Ex parte Bank of Western Australia Ltd, FCA, BC9701003, 18 March 1997

COMMISSIONER GREAVES: This is an appeal against the decision of the learned Deputy Registrar dismissing the defendant's application to set aside judgment pursuant to O 13 r 10. The action concerns a claim for damages for personal injuries sustained by the plaintiff on 2 March 1996 at premises in Wellington Street, Perth. The defendant failed to enter an appearance to the writ and the plaintiff entered default judgment on 2 September 2002. Counsel for the appellant submitted the application to set aside default judgment should be considered and determined in accordance with the following principles:
"An application to set aside default judgment should be supported by affidavit evidence which discloses a defence on the merits and explains the failure to comply with the Rules and any delay in bringing the application: Palmer v Prince [1980] WAR 61 at 62.
For an application to set aside a default judgment to be successful, the defendant must present a credible defence demonstrating that, if the default judgment was set aside and the matter was argued on its merits, the defendant would have a real prospect of success: Parker v Transfield Pty Ltd & Anor 2000, unreported judgment, Supreme Court of Western Australia Court of Appeal, Lib.
Delay by the party applying to set aside judgment does not necessarily defeat the application, but is one of a number of relevant considerations to consider according to the particular circumstances: Rolland v Bank of Western Australia, 1998, unreported, Supreme Court of Western Australia, Lib. 980498A.
The primary question is whether the defendant has a defence on the merits Kostokanellis v Allen [1974] VR 596 at 606.
Accordingly, a defendant who has an apparently good ground of defence will not be refused the opportunity of defending, even though a lengthy interval of time has elapsed, provided that no irreparable prejudice is thereby done to the Plaintiff: National Australia Bank Ltd v Singh [1995] 1 Qd R 377 at 380 (CA); Crayden v Ottaviano BC200300540; 2003 WASCA 20 at [1], [16], [55]."
The writ was issued on 19 April 2001. A letter reminding the defendant to file an appearance to the writ was sent to the defendant on 12 June 2001. All subsequent correspondence from the plaintiff's solicitor concerning the action was addressed to either the SGIO or its solicitor Messrs Jackson McDonald. Both the SGIO and its solicitors responded that they did not insure or represent the defendant. As I have said, default judgment was entered on 2 September 2002. The defendant responded to that judgment by contacting its insurer, SGIO and was assured that no action on its part was necessary. The defendant mistakenly believed that the SGIO had assumed responsibility for the defence of the proceedings on its behalf.
It was not until 12 May 2003, when it was served with notice of trial dates and consulted its own solicitors that the defendant discovered that the SGIO had not been defending the proceedings on the defendant's behalf. The defendant then acted promptly and on 14 May 2003, filed an application to set aside default judgment. I accept the submission on behalf of the appellant that the defendant acted reasonably, albeit mistakenly, under the belief that the defence was being attended to by SGIO. As soon as it became apparent that the belief was mistaken, the defendant acted without delay. I do not accept the submission by counsel for the respondent that the delay has not been explained.
As I have observed, the primary question for the Court to determine is whether the defendant has a defence on the merits.
The learned Deputy Registrar expressed the issue for determination at p 2 of his reasons in this way:
"The issue raised by the defendant is that there is an unwritten lease between itself and what I understand to be a related entity, as a consequence of which the related entity has what is described as "exclusive use" of the premises to conduct its business. As I see it the issue raised by the plaintiff at that point is as to the sufficiency of that evidence and, as I understand the plaintiff's position, the defendant thereby is simply putting a conclusion. I am afraid to say that that is how I view that evidence and it is a significant finding in light of the fact that the onus is upon the defendant."
The case of the appellant is that if the default judgment is set aside and the defence argued on its merits, the defendant would have a real prospect of success, because the evidence of Darryl Leonard Calligaro in his affidavit of 30 October 2003 at pars 8 to 14 is such that the Court should conclude it is arguable that the whole of the premises is, and was, at the date of the accident, leased at market rent by the defendant to Milne Feeds Pty Ltd. In my opinion, on this evidence and the further evidence of Mr Calligaro in his affidavit of 18 February 2004, if the issue of possession of the premises for the purposes of the Occupiers Liability Act 1995 were determined on its merits, the appellant would have a real prospect of success.
Counsel for the respondent submitted the evidence of Mr Calligaro does not establish the existence of a lease granting exclusive occupation of the premises to Milne Feeds Pty Ltd and the payment of rent is equally consistent with the existence of a licence to use the premises. He also submitted the fact that the directors of the defendant are identical with the directors of Milne Feeds Pty Ltd is consistent with the defendant retaining the right to control activities conducted on the premises. In my opinion, these submissions reflect the issue. If the evidence for the appellant is accepted on that issue, it has a real prospect of success in the action.
After this appeal was heard, the respondent sought leave to re-open the appeal for two purposes. Firstly, to adduce further evidence that the principal place of business of the appellant is the premises where the accident occurred, and secondly, to cross-examine Mr Calligaro about his knowledge of the alleged fact that the appellant had granted exclusive possession of the premises to Milne Feeds Pty Ltd.
Counsel for the appellant did not oppose or consent to the application to re-open and adduce the evidence of the principal place of business of the appellant. He submitted the further evidence does not advance the issue whether the appellant has presented a credible defence in support of its application to set aside default judgment. I accept that submission for the reasons already expressed in relation to that application.
Counsel for the appellant opposed any order that Mr Calligaro be required to attend for cross-examination about his knowledge of the alleged fact that the appellant had granted exclusive possession of the premises to Milne Feeds Pty Ltd. He referred to the judgment of the learned Chief Justice in Lovell v Western Australian Police Union & Anor, unreported; SCt of WA; Library No 930387; 30 June 1993 where his Honour observed that such an order will be made only in a special and exceptional case.
In my view this is not such a case. The issue whether a credible defence has been established was before the court on the hearing of the appeal. No special or exceptional circumstances have been shown to require the cross-examination of Mr Calligaro now.
Accordingly, there will be orders in terms of pars 1 and 2 of the notice of motion of 15 March 2004. Otherwise, for these reasons, the appeal will be allowed, the decision of the learned Deputy Registrar set aside, and the application to set aside the default judgment will be allowed.