Ross Flint Pty Ltd v PILATUS Pty Ltd - [2007] WADC 30

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: ROSS FLINT PTY LTD -v- PILATUS PTY LTD & ORS [2007] WADC 30

CORAM: DEPUTY REGISTRAR HARMAN

HEARD: 9 FEBRUARY 2007

DELIVERED : 27 MARCH 2007

FILE NO/S: CIV 2083 of 1999

BETWEEN: ROSS FLINT PTY LTD (ACN 009 264 126)
Plaintiff
AND
PILATUS PTY LTD (ACN 078 361 485)
Defendant
PILATUS PTY LTD (ACN 078 361 485)
Plaintiff by Counterclaim
ROSS FLINT PTY LTD (ANC 009 264 126)
First Defendant by Counterclaim
ROSS FREDERICK FLINT
Second Defendant by Counterclaim

Catchwords:

Practice - West Australia - Inherent jurisdiction to strike out an action for want of prosecution - Impact of case management

Legislation:

Nil

Result:

Application dismissed

Representation:

Counsel:

Plaintiff:        Mr J Panegyres
Defendant:        Mr J Curthoys
Plaintiff by Counterclaim          :    No appearance
First Defendant by Counterclaim :    No appearance
Second Defendant by Counterclaim :        No appearance

Solicitors:

Plaintiff:        Lawton Gillon
Defendant:        Holborn Lenhoff Massey
Plaintiff by Counterclaim          :    Not applicable
First Defendant by Counterclaim :    Not applicable
Second Defendant by Counterclaim :        Not applicable

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

Burkett v James [1978] AC 297

Case(s) also cited:

Nil

DEPUTY REGISTRAR HARMAN: The plaintiff's claim is for the amount owing by the defendant pursuant to the terms of an agreement whereby the defendant would purchase the plaintiff's business. According to what is revealed upon the close of pleadings the plaintiff's claim is not contested however the defendant raises a counterclaim and set-off in the form of the plaintiff's breach of a restrictive covenant.
The application before me is to strike-out the action for want of prosecution. In that application the defendant carries the onus of persuasion that is appropriate for the Court to so act.
The action was entered for trial on 3 October 2002. The pre-trial conference was held on 30 October 2002. At a listing conference on 22 November 2002 the defendant foreshadowed that it would seek to amend its pleading. On 6 March 2003 it obtained leave to do so.
It appears from the terms of a letter addressed by the plaintiff's solicitor to the Court of 19 June 2006 that on 6 June 2006 the Court had written to at least the plaintiff's solicitors. According to the letter of 19 June 2006 the plaintiff sought to have the listing conference reconvened. Evidently that course of communication provided the impetus for the defendant to make the application before me.
The often cited passage from the reasons given by Diplock LJ in Burkett v James [1978] AC 297 stand for the proposition that prior to striking out an action a court would have judged that to do so would a proportional response to some act or omission. The passage also provides some useful markers for the purpose of such an assessment. It is as follows:
"The power should be exercised where the court is satisfied either (1) that the default has been intentional and contumelious, eg disobedience to a pre-emptory order of the court or conducting amounting to an abuse of process of the court; or (2)(a) that there has been inordinate and inexcusable delay on the part of the plaintiff or his lawyers, and (b) that such delay will give rise to a substantial risk that it is not possible to have a fair trial of the issues in the action or is such as is likely to cause or have caused serious prejudice to the defendants either as between themselves and the plaintiff or between each other or between them or a third party."
I consider that it would only be upon a finding of similar gravity to that countenanced by Diplock LJ that a court would foreclose upon disposition of a dispute brought before it in the usual manner.
There is nothing to suggest any default in having the listing conference reconvened could be characterised as contumelious. The focus of attention in the course of the hearing was on the second limb of the passage.
The period of time between the conclusion of the process of amendment of the pleading and the request for the listing conference to be reconvened is a sufficiently long period to qualify as having been inordinate. The evidence of the plaintiff is that it does not consider that it is responsible for the delay as in effect, any delay in having the listing conference reconvened is as much the responsibility of the defendant as it is the plaintiff. Otherwise the plaintiff offers no explanation for its failure to progress the action to trial. I appreciate that in such circumstances if it was considered that the plaintiff was responsible for the delay in progressing the matter for trial then the want explanation on its behalf would be sufficient to justify the Court concluding that the delay was inexcusable. It is then a matter of considering whether the inordinate and inexcusable delay on the part of the plaintiff has resulted in the defendant being prejudiced.
The relevant evidence of the defendant is as follows:
"PREJUDICE BY THE DELAY
16.The most important witness who would have to testify at the trial of the matter was Mr Gunar Oksis ("Oksis") the agent who brokered the sale of the business in the question by the plaintiff to the defendant.
17.The part played by Oksis prior to the sale of the business has been described in paragraph 5 of the affidavit sworn by me on 19 July 1999 in opposition to the application by the plaintiff for summary judgment. It was Oksis who completed the written Agreement to Purchase a Business which is annexure "RF 1" to the affidavit of Ross Flint sworn by him on 30 June 1999 in support of the application by the plaintiff for summary judgments.
18.Enquiries made by me since the Listing Conference on 24 July 2006 have revealed that the broking business previously conducted by Oksis no longer exists and has been deregistered. The building just off the Great Eastern Highway in Rivervale from which Oksis conducted his business has been demolished. Oksis' name is no longer listed in the white pages. The telephone number of the business is no longer connected. I have accordingly been unable to locate or contact Mr Oksis.
19.As far as the customers of the defendant referred to in paragraph 1.1 of the defendant's answers to the plaintiff's further and better particulars to the defendant's defence set-off and counterclaim are concerned, it was always intended to call some of all of the various purchasing officers of those customers who were there for the period of about six months after the business had been purchased by the defendant.
20.As regards the customers, telephone calls made by me to those customers has revealed that the relevant purchasing officers of Dywidag System International, Parks Industrial, Ranch Automotive, Sweeting & Denny, S.&G. Engineering and A. Gonninan no longer work there. In addition ANI Products and ANI Wear have been taken over by Dywidag System International.
21.The people I spoke to currently working at those customers told me that they either did not know where the purchasing officers who worked there in 1999 were or could not even recall who they were. I verily believe that what I was told by the people I contacted was true. I spoke to:
21.1someone called Lisa at Dywidag System International;
21.2the receptionist at Parks Industrial (I am unable to recall her name);
21.3someone named John at Ranch Automotive;
21.4someone named Stuart at Sweeting and Denny;
21.5someone named Paul at S.&G. Precision Engineering.
A Gonninan is now United Gonninan and is now staffed by entirely new staff who know nothing about staff who worked there in 1999. Since all the purchasing officers at the customers mentioned were known to me only by their first names I will not now be able to locate them.
22.I have also spoken to someone named Jerry at Bestec Engineering who told me that because so much time had elapsed since the events in question took place, he was unable to recall anything.
23.For these reasons it is respectfully submitted that there has been an inordinate and inexcusable delay on the part of the plaintiff such that there is now a substantial risk that it is not possible to have a fir trial of the issues in the action or, alternatively, the delay has caused serious prejudice to the defendant."
In his responding affidavit of 20 September 2006 Ross Frederick Flynt deposes that he has located the witness Oksis and goes on to provide what amount to submissions. Be that as it may, those submissions convey what I regard to be valid points relating to the features of particular prejudice to which the defendant refers. Had the plaintiff not raised those submissions they would have been issues that I would have canvassed in my reasons for decision.
The particular paragraphs of the affidavit of Flynt are as follows:
"8. The Defendant has previously nominated a limited number of customers of the business who would be called to give evidence. I would have thought that if the Defendant intended calling any witnesses, those witnesses would have been proofed and the Defendant would be in possession of proofs of evidence. It would appear that the Defendant has not approached any prospective witness at any time since the commencement of these proceedings.
9. The matters in issue have been well known from some considerable time and it has been up to the Defendant to be in a position to prove its case. In reality, the Defendant requires witnesses to prove its counterclaim rather than to disprove the Plaintiff's claim. As previously indicated, the Plaintiff's claim is admitted by the Defendant on the pleadings.
10. It has at all times been open to the Defendant to press to have this matter determined by a court.
11. The Defendant has endeavoured to delay the progress of this action for its own purpose. The Plaintiff requires the action to be set down for hearing as soon as possible.
12. I swear this affidavit in opposition to the Defendant's application for a dismissal of the proceedings."
The only facet of those submissions that in my opinion has been overlooked is that for prejudice to justify dismissal of the action would depend upon it having been generated during the period of delay.
Prior to 6 March 2003 there is nothing to indicate that the plaintiff delayed the course of the action. The plaintiff had entered the action for trial in October 2002 and whilst that does not necessarily reflect the defendant's preparedness for trial it indicates that at least one party was prepared for trial. There is no reason to consider that the other would not have been prepared much to the same extent. As the defendant was the party who would be bringing evidence in support of its defence and counterclaim it is not unreasonable to consider that at or about that time or at least in the course of amending its pleading would not have been concluding the process of getting up its case for trial. If the defendant's evidence is taken to reveal that it failed to undertake the usual processes to that end, and there I am referring proofing witnesses and insuring that contact would be maintained with them, in my opinion the defendant can hardly complain that its failure to undertake that work at an appropriate time would somehow justify the result that the plaintiff be precluded from proceeding to trial.
I appreciate that in recent times case law has suggested that it is appropriate to depart from the formulation of the justification for the exercise of the power expressed by Diplock LJ in Burkett v James. I have no difficulty with the prospect that in the current era of case management that it is appropriate to consider that there are other measures by which a determination may be made that an action be dismissed for want of prosecution. In this particular case, whether under the old case management regime or the current case management regime I do not perceive that the plaintiff would be in default. As to whether of itself a process of case management would justify greater criticism of a plaintiff for failing to progress an action in circumstances such as that before me is ultimately a matter of judgment.
A significant consideration in reaching a judgment is that the fundamental principle upon which an exercise of discretion rests is that the effluxion of time erodes memory and provides scope to consider there would be a diminution in the quality of justice. In my opinion a significant feature of the context in which such a consideration is evaluated is that the legislature has provided a useful datum for determining whether the potential for erosion of memory would have an adverse impact on the quality of justice. I accept that the period of six years expressed in the Limitation Act 1935 may have been a judgment made on a combination of factors, however the result is that the legislature has allowed for the prospect that an action would be commenced as late as six years after the event and that allowing for delay in service and progression of an action to trial, it would be conceivable that an action would not be tried until up to eight years after the event. I would suggest that life's experiences would reveal that memory of even significant events diminishes after a matter of hours, if not days of an event. Case management is ultimately a process designed to encourage parties to proceed with an action with some measure of urgency once it has been commenced. It has nothing whatsoever to say in relation to the failure to bring on an action for trial within a given period of time.
In this case I do not consider that by any measure there is any justification for the plaintiff being penalised for failure to have brought on the action for trial.