Ron Taber Constructions Pty Ltd v Tomlinson

[1998] QCA 359

COURT OF APPEAL	[1998] QCA 359
de JERSEY CJ McPHERSON JA CULLINANE J
Appeal No 7424 of 1998
RON TABER CONSTRUCTIONS PTY LTD	Applicant (Plaintiff)
v.
OWEN TOMLINSON	Respondent (Defendant)
BRISBANE
..DATE 14/09/98 140998 T02/KL7 M/T COA230/98

McPHERSON JA: This action has a lengthy and rather unsatisfactory history. It started as long ago as 1989 when a plaint was issued against the defendant. The material in support of the present application is to my mind not particularly informative; but, so far as can be gathered from it, there was in about 1987 a settlement of an action against a company of which the defendant was a director.

It involved the company undertaking to pay a sum of money to the plaintiff. Only the first instalment was paid, as I understand it, and the balance that remains is the subject of the action against the defendant director. That action was based on s.556 of the Queensland Companies Code, which has since been repealed, which section made a director who was guilty of what is conveniently, though not entirely accurately, described as fraudulent or insolvent trading, personally liable for a debt incurred by the company in certain circumstances.

The company itself has since been dissolved. The company, it appears, was placed in receivership some 10 or so years ago, that is in about 1988 or 1989, which was I suppose about two to three years after settlement of the action against it. To succeed in this action against the defendant under s.556 it will therefore be necessary for the plaintiff to prove various matters including the insolvency of the company in 1987 when the debt was incurred.

Anyone with experience in proving insolvency at times in the past would appreciate the difficulty of doing that, which as I understand Mr Howe's submission, is a matter from which he does not shrink. It will plainly not be easy to establish insolvency at that time. The more so because, not surprisingly, at last some of the documents are said to have been destroyed in the interim.

The learned primary judge was prepared to infer, justifiably as I see it, that recollections would have deteriorated during the time that has passed since the event giving rise to the claim, and that it would be difficult if not impossible to try the issues satisfactorily.

What is equally if not more to the point is that there does not appear to be any, or any satisfactory, explanation at all for the delay over this long period. The absence of any such explanation is made worse, in my opinion, by the fact that over two years ago, that is in July 1996, much the same question was litigated before another District Court Judge, who gave the plaintiff leave to proceed in the action and conversely refused the defendant's application to dismiss it for want of prosecution.

That determination was of course interlocutory only, and it does not prevent the defendant from raising the same question, as it has done, some two years later. One would expect that the plaintiff, after the warning that it received by virtue of the application two years ago to dismiss for want of prosecution, to have got on with the action once it had survived the challenge on that occasion, but in fact little if anything was done apart from amending the plaint and delivering a certificate of readiness, in order to proceed with the action as it then was.

Then in April this year the present application, from which this appeal or application for leave to appeal is brought, came before the second District Court Judge. On that occasion, again, no account was proffered by way of explanation as to why so little was done during the period between 1996 and the date in April when the matter came on again this year.

In these circumstances it seems to me, in a practical sense, to be impossible to say that the learned
primary Judge was wrong in dismissing the action for want of prosecution as he did in July this year.
His decision is plainly not obviously wrong and, although it is not necessary for us positively to say
so, may well be correct. Despite efforts to rely on Smith v. Harvey-Sutton as establishing some new
principle in this area of the law, the question remains to my mind one of discretion; and it is not
140998 T02/KL7 M/T COA230/98
shown that the discretion exercised by the Judge in this instance went wrong in any matter of
principle or in any consideration that was taken into account or left out of account.

Specifically, the complaint is made that the matter not taken into account on this occasion was the inactivity of the defendant. It was said that the defendant had done nothing and so could not be regarded as himself having suffered any prejudice.

To my mind, although it is true that no specific reference was made to that matter, it does not follow that the learned primary Judge did not bear it in mind if it was relevant, which I have some reason to doubt. The fact remains that this action arises out of matters that occurred a very long time ago, and that it will be almost impossible to produce a proper judicial determination in relation to a question

often so difficult as insolvency when the issues that will be contested relate to facts and events that
occurred over a decade or more ago.

In these circumstances, and finding as I do no error of principle or detail in the Judge's determination, I can see no basis on which leave to appeal in this case should be allowed.

I would therefore dismiss the application.

THE CHIEF JUSTICE: I agree.

CULLINANE J: I also agree.

THE CHIEF JUSTICE: The application is dismissed with costs to be taxed.

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