Ryan v Optus Networks Pty Limited

[2023] NSWSC 702

Supreme Court

New South Wales

Medium Neutral Citation:

Ryan v Optus Networks Pty Limited [2023] NSWSC 702

Hearing dates:

05 June 2023

Date of orders:

05 June 2023

Decision date:

23 June 2023

Jurisdiction:

Common Law

Before:

Rothman J

Decision:

(1)   Summons is dismissed.

(2)   The costs of this application will be costs in the cause.

Catchwords:

CIVIL PROCEDURE – jurisdiction – transfers to and from other courts – application to transfer from Local Court to Supreme Court – jurisdictional limit – proceedings ready for hearing – serious issues with calculation of damage relevant to asserted liability – not in the interest of justice to transfer

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 140

Cases Cited:

Ryan v Bunnings Group Ltd [2020] ACTSC 353

Category:

Procedural rulings

Parties:

Mark Ryan (Plaintiff)
Optus Networks Pty Limited (First Defendant)
Telstra Limited (Second Defendant)

Representation:

Counsel:
In person (Plaintiff)
S Onitiri (Defendants)

Solicitors:
Self-represented (Plaintiff)
Gadens Lawyers (First Defendant)
McCullough Robertson Lawyers (Second Defendant)

File Number(s):

2022/205831

ex tempore JUDGMENT (revised)

1. HIS HONOUR: Before the Court is an application presumably, pursuant to the terms of s 140 of the Civil Procedure Act 2005 (NSW), for the Court to make an order transferring the proceedings that are currently in the General Division of the Local Court of New South Wales at Queanbeyan to this Court, being the Supreme Court of New South Wales.

2. The Court, of course, is not bound by the remedies sought in any particular proceedings. The Court could, on the application, refer the matter from the Local Court to the District Court, assuming it was so minded. The only restriction on the jurisdiction of the Court to transfer the proceedings to a higher court under s 140 of the Civil Procedure Act is the Court is unable to do so unless it is satisfied that there is sufficient reason for hearing the proceedings in the higher court.

3. The proceedings in the Local Court were commenced by the plaintiff and it is the plaintiff who seeks the transfer. There have been a number of iterations of the Statement of Claim. I will deal with the last of them only, and where there is a reference in this judgment to the Statement of Claim it is a reference to the last iteration of the Statement of Claim.

4. The plaintiff is Mark Ryan. He is self-represented before the Court. He conducted, it seems on the material currently before the Court, one business and either a second business or was in other employment. He operated nightclub interests and he also worked as a chiropractor.

5. The current claim refers to his business as a chiropractor which, under the Statement of Claim, he suggests is a business he was intending to take up full-time when or if his nightclub interests ceased. In any event, the plaintiff alleges that in 2014 and 2015 he suffered loss and damage as a result of interruption to the businesses that he operated and in particular, in this instance, the chiropractor business.

6. The allegation is that the plaintiff suffered interruptions to the business due to faulty telecommunications or the faulty repair of telecommunications provided by one or other or both of the defendants which are Optus Networks Pty Ltd and Telstra Corporation Limited, hereinafter referred to as “Optus” and “Telstra” respectively. The premises were in Griffith ACT and the proceedings are currently, as has earlier been made clear, proceeding in the Queanbeyan registry of the Local Court.

7. A short summary of the claim is that because of the telecommunications interruptions the plaintiff’s businesses failed and he had to close them and eventually had to sell properties leading to significant losses. He also seems to claim psychiatric harm, although whether it is alleged that it was caused by a telecommunications interruption does not seem to be absolutely clear on the face of the Statement of Claim.

8. The plaintiff commenced proceedings in the Local Court at Queanbeyan on 7 December 2020. Optus and Telstra have each filed defences denying liability to the plaintiff and the quantum of the alleged claim. On 8 July 2022 the plaintiff filed this Summons seeking to transfer the proceedings to this Court. Each of Optus and Telstra (which are commendably, I hasten to add, represented by one counsel) oppose the transfer and take issue with a number of the allegations of fact upon which the plaintiff relies for the purposes of these proceedings.

9. The plaintiff relies upon his own Affidavit of 17 June 2022. In that Affidavit the plaintiff deposed that he is seeking a transfer as he received a forensic accountant’s report from Mr Graeme Bailey who estimated the plaintiff’s losses arising from alleged business interruptions as being in excess of $2.5 million. The plaintiff annexed a copy of the current iteration of the Statement of Claim before the Local Court, as well as a copy of Mr Bailey’s report of 19 September 2021 and an addendum of 8 August 2022.

10. Mr Bailey’s report states that the basis of the claim for loss is that because of the faulty telephone connection at the plaintiff’s premises the plaintiff ran into difficulty operating a chiropractic business and also running a nightclub in the ACT called “Krave”. The plaintiff instructed Mr Bailey that he had to sell his property in Griffith, which was sold by his former partner. $700,000 from that sale went to the former partner as part of a property settlement. He also had to sell a further property in Aranda, ACT due to the subsequent cash flow problems. It is also part of the plaintiff’s case that the faulty telephone connection led to aggravation of a cognitive impairment suffered by the plaintiff. The plaintiff ceased his chiropractic business and the nightclub business some time before or in August 2014. Between June 2016 and June 2019 the plaintiff was bankrupted.

11. These facts were used by Mr Bailey in the preparation of his report. In the addendum to the report dated 8 August 2022 Mr Bailey took into account the comparative sale prices of the plaintiff’s properties in Griffith and Aranda and came to a total figure of overall loss in the vicinity of $2.6 million. The manner in which Mr Bailey took those matters into account is the subject of criticism in the submissions of the defendants.

12. The evidence on behalf of the defendants, in the case of Optus, is an Affidavit of Toby Chandler dated 5 October 2022. Mr Chandler is Optus’s solicitor. Essentially, he deposes to the procedural history of the Local Court proceedings which can be summarised in the most important elements in the following way.

13. The proceedings were commenced (as earlier stated) in December 2020. In July 2021 the plaintiff sought to amend the claim. In October 2021 the plaintiff sought leave to file a reply to Telstra’s Second Amended Defence. On 19 January 2022 the plaintiff again sought leave to amend his claim. Leave was granted on 15 February 2022 leading to a hearing date of 23 February 2022 being vacated. On 25 May 2022 the plaintiff intimated that he intended to transfer the proceedings to the Supreme Court. This intimation occurred during a directions hearing in the Local Court.

14. On 15 June 2022 a further call-over took place and the plaintiff submitted he was going to have surgery and would be incapacitated for a number of weeks. On 25 July 2022 the plaintiff served a Notice of Listing of these proceedings, which were first before this Court the following day, being 26 July 2022. At or about 7.30am on 26 July 2022 the plaintiff served a copy of the Summons and Affidavit in support but, apparently omitting the expert report upon which he relied. On 8 August 2022 the plaintiff served a complete copy of the expert report upon which he relied.

15. Since 15 June 2022 the Local Court proceedings have been held in abeyance pending the outcome of this Summons. The Local Court proceedings as I understand it, and as I have been informed this morning without contradiction, are otherwise ready to proceed. The Magistrate has indicated that the Court intended to set a hearing date as soon as is practicable if the Summons to transfer is unsuccessful.

16. Apart from the foregoing, Mr Chandler otherwise deposed that Optus has a significant presence in the Australian Capital Territory and that is the location of Optus’s in-house counsel. I assume that this is for the purposes of suggesting that it is more convenient for the matter to be dealt with in Queanbeyan. Mr Chandler’s client is ready to proceed to hearing in the Local Court proceedings.

17. In the case of Telstra, it relies upon the affidavit of Jason Munstermann of 5 October 2022. Mr Munstermann is the solicitor for Telstra. Mr Munstermann deposes to the fact that Telstra has the means to conduct these proceedings, something frankly of which I think the Court would have taken judicial notice, but in this particular case in the ACT. His own office is in the ACT, as is the counsel Telstra has instructed.

18. Telstra also has a corporate office in Canberra. Mr Munstermann stated that the Telstra records indicate that the technicians who have worked at the subject property in Griffith were employed in the ACT. Accordingly he states that witnesses residing in the ACT will be likely to be called in the proceedings.

19. Mr Munstermann also states that on 25 January 2022 Telstra issued a Notice to Produce to the plaintiff in the Local Court proceedings seeking copies of documents setting out the plaintiff’s claim for economic loss, and that the Notice has not yet been the subject of compliance, at least as at the date of the Affidavit which, was 5 October 2022.

20. Mr Munstermann also annexed a copy of a judgment of the Supreme Court of the ACT, in particular the judgment of her Honour Loukas-Karlsson J in Ryan v Bunnings Group Ltd [2020] ACTSC 353. That judgment is relied upon to support the submission made by both Optus and Telstra that the estimate of damages upon which the plaintiff relies as the reason to transfer the proceedings to the Supreme Court is, at best, questionable and ought not be accepted by the court.

21. Apparently, the judgment of her Honour dealt with a number of personal injury claims which were commenced by the plaintiff and all heard together. They related to an incident at Bunnings where a worker’s arm came into contact with the plaintiff’s face, a motor vehicle accident on 20 September 2013, an alleged false imprisonment at Eastlake Football Club (referred to as the “Eastlake incident”), a motor vehicle accident on 31 August 2015 and a motor vehicle accident on 25 January 2018.

22. Her Honour Loukas-Karlsson J found that the plaintiff operated a chiropractic business from the house in Griffith where he lived with his former partner. He also operated a nightclub.

23. In 2014 the plaintiff was sued by the landlord of the nightclub premises and the plaintiff’s countersuit was unsuccessful. A petition for bankruptcy was filed and the plaintiff entered bankruptcy in June 2016.

24. The plaintiff said that after the Eastlake incident on 15 February 2014 he could not work physically or run his club after the injuries. He submitted in that trial that such incapacity continued until the club had to close down in August 2014. The plaintiff was unsuccessful in the litigation before the ACT Supreme Court.

25. It is necessary to reiterate that the alleged interruption to the telecommunications equipment upon which the plaintiff brings this claim is said to have taken place between 2014 and 2015. Mr Munstermann’s client is, according to the Affidavit, otherwise ready to proceed to hearing in the Local Court proceedings.

26. In reply to the evidence filed by Telstra and Optus, Mr Ryan filed a further Affidavit of 23 March 2023. That Affidavit deposed that since 2014, the plaintiff has suffered cognitive decline secondary to major depression and anxiety. Mr Ryan states in the Affidavit that he was a chiropractor between 1982 and 2017. He says he had phone connections with other chiropractic locations and phones would divert to his main reception line in Griffith ACT. He also had phone connections for various nightclubs in which he had an interest. To manage his various phone connections he had a call management system in place at the Griffith property. He says that this became faulty due to the defendants’ actions and this is the basis of the claim described above.

27. The Affidavit annexes two full folders of exhibited material, some of which is fairly illegible including copies of the reports of Mr Bailey, documents produced to court, emails with the defendants and bank records. There are also copies of health-related reports relevant to the plaintiff.

28. There is also a document oddly titled “Written Submissions in respect of the Plaintiff’s Application to Transfer the Proceedings from the Local Court to the Supreme Court” which is authored by the so-called expert, Mr Bailey. If in fact Mr Bailey has written submissions for the plaintiff or in support of his transfer of proceedings it would significantly call into question the required independence of the expert to give evidence of the kind that he is giving in the proceedings.

29. In any event those written submissions seek to explain the basis of the formulation of the economic loss referable to the matter as distinct from the personal injury proceedings. The document noted that Mr Bailey used monthly income spreadsheets generated by the plaintiff to formulate his assessment, whereas in the personal injury proceedings BAS statements were used.

30. The plaintiff also annexed a copy of the Supreme Court judgment (why there was a second copy is not totally clear) but in the course of annexing it added disputed comments to the matters raised in the judgment. I note that no appeal was successful against the claim as I understand it. It seems to be asserted by the plaintiff that there was an appeal run at two levels, both at the appellate level in the ACT and to the High Court, and on the material both of them were unsuccessful.

31. It is probably appropriate for me to deal a little with one of the bases for the claim for damages. Mr Bailey (at p 62 of the Application Book) refers to the plaintiff’s monthly income between July 2012 and March 2014. During that period the average monthly gross revenue of the plaintiff was $4,028 per month. In the period April 2014 to September 2018, the average monthly gross revenue was $3,062. As a consequence, Mr Bailey concludes that the average gross revenue reduced by approximately $976 or 24% per month and that Mr Ryan, the plaintiff, experienced a significant reduction in gross revenue from April 2014 to October 2018 compared to July 2012 to March 2014.

32. As has been pointed out, a monthly average income loss of $970 is the gross amount that was determined from the figures that were provided. At p 65 of the said report Mr Bailey tells us that the expenses were 51% of revenue and that as a consequence the net profit forgone is $20,086, being $40,992 less $20,906 (that is at .6.28.7 of his report at p 65 of the Appeal Book.) In fact the defendants were a little more generous in that sense. They calculated the total loss over 483 weeks to be arguably, at its highest, $57,960. I accept that figure as relatively accurate.

33. The basis upon which the damages ran from $57,960 into the millions is a basis which calculates losses made on the sale of real estate. The capital loss that is taken into account is a loss calculated by the value as at the date of the report by a valuer less the amount for which the real estate was sold.

34. Yet evidence before the Court suggests, first, that the property, or at least one of them, was sold as a consequence of over $700,000 being owed in mortgages and of course at that stage the applicant became bankrupt. Now the plaintiff says that the bankruptcy was the result of the losses occasioned.

35. The difficulty in effect is that the plaintiff lumps together all of the losses he possibly found without in any way seeking to allocate, either on a reasonable basis or an appropriate basis or an expert basis, that which arose from the telecommunication interruption - assuming for present purposes that it occurred and that it was a matter upon which the defendants are liable - to sheet it home to the defendants.

36. There is no explanation for how a person who was incapable of physically carrying out the business of a nightclub was physically capable of carrying out the business of a chiropractor; nor is there any attempt to distinguish between several possible causes, some of which were the subject of the litigation before the ACT Supreme Court.

37. There is also a fundamental issue relating to what is an obvious deduction. It is one thing to say that a loss occurred as a result of a forced sale; it is quite another thing to say that a loss occurred because of the opportunity loss occasioned by the fact that the property was not kept, that is, was not continued in the possession and sold as at today’s date. None of that has been adequately explained.

38. The defendants say that the power in s 140 of the Civil Procedure Act depends upon a range of factors, and those factors include the issue of delay, the nature and strength of the reason for transfer, and the overriding purpose of the Civil Procedure Act. That last relevant factor is in my view the most important factor in determining the exercise of any discretion under the Civil Procedure Act.

39. It is the function of the Court to facilitate the just, quick and cheap resolution of matters in dispute. The matters in dispute are those matters that are contained in the pleadings, that is, that which has been put before the Court which defines the issues.

40. Thus far, notwithstanding the reiteration of the Statement of Caim well after the expert report, the Statement of Claim still alleges damages at $100,000. As a consequence, taking a technical view of the claim that is before the Local Court, it is a claim for $100,000 as a maximum.

41. Nevertheless, assuming the Court ignored that aspect, it seems to me that the Local Court is ready to proceed on the matter and I accept the submissions of the defendants that the calculation of damage over $2 million is a calculation that is, at best, questionable. I do not here deal with liability, but I do say that the calculation of damage insofar as it depends upon the expert report of Mr Bailey is a calculation of damage that does not give the Court sufficient reason to transfer a proceeding that has been before the Local Court for such a long period of time and is ready to proceed.

42. In all of those circumstances the Summons is dismissed. The costs of this application will be costs in the cause.

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Decision last updated: 23 June 2023