Shammah Pty Ltd v Jewel - [2005] QDC 315

[2005] QDC 315

DISTRICT COURT

CIVIL JURISDICTION

JUDGE ROBIN QC

No 391 of 1998

SHAMMAH PTY LTD (ACN 010 554 033)	Plaintiff
and
KERRY JAMES JEWEL	Defendant

BRISBANE

..DATE 12/10/2005

ORDER

CATCHWORDS: Uniform Civil Procedure Rules r 389 - plaintiff's application for leave to proceed after delay of almost 6 years - only explanation of delay was impecuniosity - limitation period still has years to run - action uncomplicated, but uncertainty what documents might become available - defendant says it would be premature to allege prejudice - leave granted.

HIS HONOUR: This is a plaintiff's application under rule 389.2 of the Uniform Civil Procedure Rules for leave to proceed, notwithstanding delay in excess of two years since the last step was taken. That was as long ago as the 18th of November 1999 when the plaintiff filed a notice to admit facts, presumably under rule 189.

In an application heard yesterday there was discussion whether that amounted to a step, whether or not it was a step or "proceeding" under the former Supreme Court rules. It seems to me that the serious consequences of failing to respond to a notice to admit facts under rule 189 which can lead to a deemed admission make it clear that there is a step. Those consequences did not flow from RSC order 36 rule 2, rather the recipient of the notice remained free to contest the alleged facts contained in the notice. Only days before 18 November 1999 other "steps" were taken which undoubtedly qualify as such.

The delay of nearly six years is by any standards inordinate. It is curious against a background of considerable activity after 30th of January 1998 when the plaint was filed under the then District Court rules; a judgment summons was filed, adjourned and then dismissed by consent.

The Court is given to understand that the parties are theatrical entrepreneurs. Relevantly they had dealings to do with a special purpose company called Peter Pan The Production Pty Ltd.
The dealings led to a deed of agreement being executed by Peter Pan The Production Pty Ltd as borrower on or about the 9th of January 1996. At that time the defendant executed the deed of agreement as guarantor. Arrangements were envisaged in which persons participating by way of providing the finance for the intended production could seek to withdraw or obtain equity and the like. The plaintiff obtained the advantage of an instrument under seal which might give it the entitlement to claim $150,000 from Mr Jewel as guarantor.

His defence asserted that he had made relevant payments aggregating virtually the whole sum. There was a counterclaim seeking rectification of the deed by deletion of identified words so as to give effect to some oral agreement. The reply and answer disputed that the payments asserted in the defence were made against the $150,000 liability, but did acknowledge a payment in a sum slightly under $40,000 which reduced the defendant's liability to about $110,000.

There is no persuasive explanation…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2005] QDC 315
Decision Date: 12/10/2005

CaseChat Overview and Summary

The matter before the District Court was an application by Shammah Pty Ltd for leave to proceed with a claim against Kerry James Jewel, under Rule 389.2 of the Uniform Civil Procedure Rules. The plaintiff sought leave to proceed despite a delay of almost six years since the last step was taken in the proceedings, which was the filing of a notice to admit facts on 18 November 1999. The plaintiff's action related to a guarantee executed by Jewel on a deed of agreement on 9 January 1996, where Jewel guaranteed a $150,000 liability to Shammah Pty Ltd. The plaintiff sought to claim the full amount, while Jewel defended the action on the basis that he had made relevant payments reducing his liability to about $110,000. Jewel also counterclaimed for rectification of the deed to reflect an alleged oral agreement.

The court was required to decide whether to grant the plaintiff's application for leave to proceed despite the significant delay. The court considered the factors relevant to determining whether leave should be granted, including the length and explanation for the delay, the impact of the delay on the defendant's ability to defend, and whether the limitation period was still running. The court noted that the limitation period had not yet expired and that the plaintiff's rights likely depended on the transmission of a fax that Jewel claimed not to have received. The court also considered the relative simplicity of the factual issues in the case and the uncertainty about the availability of documents that might establish the transmission of the fax.

The court granted the plaintiff's application for leave to proceed, finding that the predominant consideration was the fact that the limitation period had not yet expired. The court noted that some of the prejudice to the defendant was already present in 1999 and had not changed. The court found it difficult to give effect to the defendant's submission that the plaintiff should not be granted leave unless and until the extent of prejudice to the defendant was identified. The court held that it was not an abuse of process for the plaintiff to start again if leave to proceed were denied, and that there was no point in requiring the repetition of effort. The court ordered that the plaintiff pay the defendant's costs of the application to be assessed on the standard basis.

Orders