Shenton v Hughes

[2015] WADC 4

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CIVIL

LOCATION:   PERTH

CITATION:   SHENTON -v- HUGHES [2015] WADC 4

CORAM:   LEVY DCJ

HEARD:   17 DECEMBER 2014

DELIVERED          :   28 JANUARY 2015

FILE NO/S:   APP 32 of 2014

BETWEEN:   RICHARD LAURENCE SHENTON

Appellant

AND

BRYAN HUGHES
Respondent

ON APPEAL FROM:

Jurisdiction              :  MAGISTRATES COURT OF WESTERN AUSTRALIA

Coram  :MAGISTRATE ZEMPILAS

File No  :FR MINOR 568 of 2013

Catchwords:

Appeal - Magistrates Court (Civil Proceedings) Act 2004 - Extension of time to appeal - Distinction between judgment and order - Natural justice

Legislation:

Magistrates Court (Civil Proceedings) Act 2004

Result:

Appeal allowed in part

Representation:

Counsel:

Appellant:     In person

Respondent:     Mr M I Lenhoff

Solicitors:

Appellant:     Not applicable

Respondent:     Williams & Hughes

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

Bienstein v Bienstein [2003] HCA 7; (2003) 195 ALR 225

Dousi v Colgate Palmolive Pty Ltd (1987) 9 NSWLR 374

Grant v Mansom [2013] WADC 53

Licul v Corney [1976] HCA 6; (1976) 180 CLR 213

Meddings v Council of City of Gold Coast [1988] 1 Qd R 528

Shenton v Touchstone Farms Pty Ltd [2012] WASCA 261

1. LEVY DCJ:  This is an appeal brought by Richard Laurence Shenton (the appellant) against the decision of Magistrate Zempilas sitting at Fremantle Magistrates Court in the civil jurisdiction on 19 February 2014.  The appellant appeals against the magistrate's decision to refuse to allow an extension of time to appeal against a registrar's decision to dismiss his claim and allow a default judgment against him in the sum of $10,000 plus $116.95 in costs.

Background

1. On 28 March 2013 the appellant lodged a minor case claim in the Magistrates Court of Western Australia against Bryan Hughes, as receiver and manager of Mt Richon Investments Pty Ltd trading as the receiver and manager (the respondent).  The claim was brought pursuant to pt 4 of the Magistrates Court (Civil Proceedings) Act 2004 (MCCPA) and was expressed as being in the sum of $6,000 plus fees of $131.90.  In essence, the claim was for monies received by the respondent in the nature of bonuses earned in relation to a horse called 'Counter Offer'.  The appellant contended that he was entitled to receive these monies which were in fact, according to him, paid to the respondent.

2. I note that there is a long history of dispute between the parties.  This includes two previous deeds of settlement between the parties.  The first deed of settlement was dated 17 September 2010.  The second deed of settlement was dated 15 July 2011.  The deeds of settlement relate to claims by the appellant against the respondent.  I shall return to these deeds later in my reasons.

3. It is not necessary to go through the entire history of the matter, but note that on 7 May 2013 the respondent wrote to the Magistrates Court asking that the appellant's claim be dismissed.  Thereafter, the respondent brought an application to formally have the claim dismissed.  The respondent also sought to have the venue for the hearing changed.  Both of those applications were dismissed.

4. On 18 September 2013, the respondent sought and was granted leave to defend the appellant's claim.  That application was heard at Fremantle Magistrates Court.  Both the appellant and the respondent were present in court when the matter was set down for a hearing commencing at 10.30 am on 3 December 2013.

5. On 8 October 2013 the respondent filed a counterclaim in the sum of $10,000.  I note that the counterclaim was in the following terms:

   1.The relevant facts are set out in the defendant's statement of defence to minor case claim. 

   2.The claimant has breached the first deed of settlement and second deed of settlement by commencing these proceedings. 

   3.By reason of the breaches, the defendant has suffered loss and damage and the defendant seeks a remedy by way of a reimbursement of costs incurred in relation to these proceedings. 

6. A statement of defence to the appellant's minor case claim was filed at the same time as the counterclaim.  In the statement of defence the respondent sets out a summary of facts relevant to his defence to the appellant's minor case claim.  Nowhere in that summary of facts does the respondent set out the nature of his counterclaim.

7. On 3 December 2013 at 10.30 am the matter was listed before a registrar of the Magistrates Court for a pre-trial conference.  The respondent appeared at 10.30 am, but the appellant did not.  In default of the appellant's appearance at the pre-trial hearing the registrar made orders pursuant to the Magistrates Court (Civil Proceedings) Rules 2005 (r 21) dismissing the appellant's claim and upholding the respondent's counterclaim in the sum of $10,000 plus $116.95 in fees.

8. On or about 27 December 2013 the appellant lodged an appeal against the registrar's orders.  The appeal was brought pursuant to s 29 of the Magistrates Act 2004 (MCA) which allows a person dissatisfied by a decision made by a registrar in the exercise of any of the court's jurisdiction or powers to appeal to a magistrate.  The time limit for bringing such an appeal is 21 days (s 29(2) MCA).  A magistrate may extend the time to appeal (s 29(3)).  In this case the time limit for appealing to a magistrate pursuant to s 29 of the MCA expired on 24 December 2013.

9. The notice of appeal was dated 24 December 2013, but it would appear was not received by the registry of Fremantle Magistrates Court until 27 December 2014.  When the matter came on for hearing before the learned magistrate on 19 February 2014, her Honour, Magistrate Zempilas erroneously proceeded on the basis that the appeal had not been filed until 3 January 2014.  In fact, the date of 3 January 2014 was the date of service of the notice of appeal, not the date the notice of appeal was filed or lodged.  In any event, although neither party referred to the issue, there is a real question as to whether the period between 24 December and 15 January can be taken into account for the purposes of reckoning the relevant time.  (See Rules of the Supreme Court 1971, O 3, r 4.)  Depending upon what construction of the time limits is applied, the appeal was either one day or, at its highest, three days (if the date of 27 December 2013 is adopted) out of time.  Even if the date of 3 January 2014 was adopted as the date the appeal was lodged, the appeal would only have been 10 days out of time.

10. In my view the appeal was only one day out of time.

The hearing before her Honour, Magistrate Zempilas, on 19 February 2014

1. On 19 February 2014 the appellant's application for an extension of time to appeal against the registrar's orders was heard by her Honour, Magistrate Zempilas.

2. It is clear from the transcript of that hearing that the appellant was seeking to appeal against both the registrar's decision to dismiss his claim as well as the default judgment in favour of the respondent's counterclaim.  Both the appellant and the respondent appeared unrepresented at that hearing.  The appellant explained to the learned magistrate that the reason that he had failed to appear before the registrar was that he had had some problem with his horses (ts 2).  The appellant went on to explain that he did in fact attend court on the appointed day (3 December 2013) although he had attended somewhere in the order of between 1 hour 50 minutes to 2 hours late.  By the time he attended court the matter had already been dealt with.

3. During the course of the hearing before Magistrate Zempilas the appellant referred to Shenton v Touchstone Farms Pty Ltd [2012] WASCA 261 and attempted to hand up a copy of that decision to the learned magistrate (ts 3). It is clear from the transcript that the appellant was attempting to deal with the counterclaim in the context of the Shenton vTouchstone decision.  The appellant referred to some of the facts of the Shenton vTouchstone case and in particular then said:

   But in any event, where there was unsubstantiated damages, they should not have heard it without me being or giving me the opportunity to speak.  The word is natural justice.  And the three judges in that case, Ma'am, were unanimous that that was the situation.  And this is exactly the same.

4. The appellant then went on to deal with his own minor case claim which had been dismissed (at pages 4, 5 and 6 of the transcript of the hearing on 19 February 2014).  Later the appellant then said as follows (ts 7):

   In any event, Ma'am, the substantive part of this appeal is that this unsubstantiated damages and if you look at page 9 of the Appeal Court Supreme Court matter that I showed you the only material before the magistrate was minor case form, and what was said in exchange between the magistrate and the appellant, which was myself at the time:

   There was nothing in that which the magistrate could find that the appellant was entitled to damages in the sum of $10,000 or any sum.  That was not, however, a matter on which the appellant should rely.

   I received a $10,000 unsubstantiated damages for not turning up to a pre‑trial conference with a registrar.  Not able to give my case, not able to represent myself, in a minor default. 

5. Later in dealing with the application itself, the learned magistrate dealt with the application for an extension of time and made reference to the 21 day time limit.  Her Honour said (ts 8):

   Clearly, in my view, Mr Shenton knew he had a pre-trial conference that morning.  Something would have happened at that pre-trial conference and that really he ought to have followed that up with the court if he didn't receive notice well before the three weeks was up.

6. Her Honour then went on to deal with the merits of the claim and said as follows (ts 8 – 9):

   In relation to the merits of the claim, I take into account what Mr Hughes [sic] in relation to the deed of settlement which was made between himself as receiver/manager of the Mt Richon Investments and the claimant, and pursuant to the provisions of that deed, I am satisfied that it essentially renders the claimant's claim – well, very unlikely to succeed.  Firstly, because of its provisions in relation to a bar to any subsequent claim, and also in respect to its provisions, in particular clause 7 and the provisions there about the receiver.  Sorry, it's clause 8 of the first deed, clause 7 of the second deed, particularly that:

   the receiver will not be personally liable in any way in relation to this deed or any cause or action or any other matter connected with this deed. 

   And Mr Hughes is no longer the receiver/manager of Mt Richon.  He is, in my view, being sued, in the colloquial term, personally, Bryan Hughes as receiver/manager of Mt Richon, and that in my view is precluded by not only the deed of settlement but also more generally at law.  So in my view the claimant's claim has no merit and on that basis and for the other reasons I outlined, the extension of time to appeal is refused.

7. Nowhere in the learned magistrate's decision does her Honour refer to the counterclaim.  The counterclaim was in fact the judgment made in default by the registrar at Fremantle Magistrates Court on 3 December 2013.

The appeal to the District Court

1. The appellant now seeks leave to appeal against the decision of the learned magistrate.  A notice of appeal against the magistrate's decision was dated 13 March 2014 and filed on 18 March 2014.  I note that this appeal was some six days out of time.  In essence, the appeal was articulated as being an appeal against Magistrate Zempilas' refusal to grant an extension of time to appeal.  It listed some seven grounds of appeal.

2. On 20 July 2014 the appellant filed an amended notice of appeal with six grounds.

3. Ultimately the matter came on before her Honour Judge Schoombee in the District Court on 18 August 2014.  Her Honour made a number of orders as follows:

   1.The matter be adjourned for the hearing of an appeal by the District Court against the decision by Magistrate Zempilas handed down on 19 February 2014.

   2.The appeal be confined to the following matters:

   (a)Whether the decision by Magistrate Zempilas to refuse an extension of time for the appeal from the registrar is an order or a judgment and whether s 32(2) of the Magistrates Court (Civil Proceedings) Act allows this appeal.

   (b)Whether Magistrate Zempilas denied natural justice to Mr Shenton because she did not allow him to develop his argument that the damages relating to the counterclaim were unliquidated and that the decision of Shenton v Touchstone Farms [2012] WASCA 261, 24, applied (it is accepted by the respondent that the grounds of appeal adequately indicate this ground).

   (c)Whether, if Magistrate Zempilas denied natural justice to Mr Shenton at the hearing of the appeal, it affected only her decision on the counterclaim or also decision on the claim.

   (d)Whether an extension of time for bringing the appeal to the District Court should be granted (notice of appeal filed on 18 March 2014; should have been filed on 12 March 2014).

Time to appeal at the District Court

1. Pursuant to s 32(2)(a) and s 40(3) of the MCCPA any appeal must be brought within 21 days. It is clear therefore that the last date to appeal was 12 March 2014. This appeal was brought some six days out of time. In Grant v Mansom [2013] WADC 53 [12], Deane DCJ stated that the principles to be applied for an extension of time under s 40(3) are essentially:

   (a)the extent of and reasons for the failure to file an appeal within time;

   (b)the prospect of the appellant succeeding in the appeal; and

   (c)whether any prejudice would be suffered by the respondent by reason of the granting of an extension of time.

2. So far as the issue of delay is concerned, the appellant points to the fact that the appeal to the District Court was only some six days out of time.  Additionally, he contends that there were problems in obtaining the transcript of the hearing before Magistrate Zempilas on 19 February 2014.

3. So far as the considerations raised in (a) and (c) (above) are relevant, it is my view that the reasons for the failure to file the appeal within the time limits and the lack of any real prejudice to the respondent would not prevent me from granting an extension of time to appeal.  The real issue is (b), namely the prospect of the appellant succeeding on the appeal.

Does s 32 allow the appeal – is it an appeal against an order or a judgment?

1. Section 32 of the MCCPA provides that , except as provided by that section, no appeal lies against either (a) an order made by the court in the course of proceedings in a minor case (s 32(1)(a)); or (b) the judgment of the court in a minor case (s 32(1)(b).

2. A party to a minor case who is dissatisfied with a judgment of the court may appeal pursuant to s 32(2) of the MCCPA as follows:

   (a)if the Court was constituted by a magistrate – an appeal lies against the judgment under Part 7 and, subject to subsection (3), Party 7 applies to the appeal; or

   (b)if the Court was not constituted by a magistrate – the party may appeal to a magistrate under and subject to the rules of the court and this section. 

3. Section 32(3) of the MCCPA provides that:

   (3)Despite Part 7 an appeal against a judgment in a minor case may only be made on the grounds -

   (a)that the minor case –

   (i)was not within the jurisdiction of the Court; or

   (ii)was not a minor case;

   or

   (b)that in dealing with the minor case there was a denial of natural justice; or

   (c)that the judgment was beyond the Court's jurisdiction.

4. If there is a proper basis to appeal in this case, the only basis upon which the appellant could appeal in the circumstances of this case is pursuant to s 32(3)(b) namely, that in dealing with the minor case there was a denial of natural justice.

5. A fundamental issue arises in the context of this case as to whether the decision of the learned magistrate constitutes an order or a judgment. If it is an 'order', there would be no basis to appeal to the District Court since s 32(2) of the MCCPA only allows appeals from a 'judgment' of a magistrate.

6. The respondent contends that the decision by Magistrate Zempilas to refuse the appellant's application for an extension of time to appeal was an interlocutory order rather than being a 'judgment'.  The respondent's contention is that an application for an extension of time is one that concludes with an order and is therefore necessarily interlocutory in character.  In support of this argument the respondent referred to a number of cases to support this contention including Meddings v Council of City of Gold Coast [1988] 1 Qd R 528, 534 and Dousi v Colgate Palmolive Pty Ltd (1987) 9 NSWLR 374, 379 (Kirby P and Glass JA).

7. The respondent submitted that such an order is one that is made pursuant to statutory powers to extend time limits and that typically such decisions are categorised as interlocutory in nature because they involve no final decision or adjudication of substantive rights, but instead deal with ancillary questions of procedure.  Furthermore, although they may effectively prevent a party from proceeding with a cause of action, or limit the cause of action, or as here, prevent an appellant proceeding with an appeal, the practical consequences of the orders do not alter the classification of their character or nature.

8. On the other hand, the appellant submits that the proper construction of the decision to refuse him an extension of time to appeal amounts to a final decision which is analogous to a judgment.  There is some force in the respondent's argument.  If, pursuant to s 32 of the MCCPA, the learned magistrate's decision is categorised as an 'order', it would in effect prevent him from proceeding with the appeal.

9. In Bienstein v Bienstein [2003] HCA 7; (2003) 195 ALR 225 [25] McHugh, Kirby and Callinan JJ referring to Gibbs J in Licul v Corney(1976) 180 CLR 213 [25] said:

   The usual test for determining whether an order is final or interlocutory is whether the order, as made, finally determines the rights of the partieshttp:// - .  The test requires the appellate court to look at the consequences of the order itself and to ask whether it finally determines the rights of the parties in a principal cause pending between them.  Accordingly, orders refusing to set aside a default judgment or refusing to grant an extension of time are not final judgments because the unsuccessful party could make a further application for the same relief, even though such an application might have very little prospect of success.

10. It is my view that cases such as Meddings v Council of City of Gold Coast [1988] 1 Qd R 528 and Dousi v Colgate Palmolive Pty Ltd (1987) 9 NSWLR 374 can be distinguished. Those cases did not involve orders that finally determined the party's rights in the action. A characterisation of the orders the subject of those appeals as being interlocutory in nature simply meant a grant of leave to appeal was required before the appeal could proceed. On the other hand, Magistrate Zempilas' decision, if it were characterised as an 'order', would have the effect of denying the appellant any right of appeal. No further application could be brought by the appellant.

11. Consequently, I am satisfied that the decision of Magistrate Zempilas to refuse the appellant's application  for an extension of time to appeal is properly characterised as a 'judgment' in the context of s 32 of the MCCPA.

The merits of the appeal

1. There are two separate judgments sought to be appealed against.  They are:

   (a)the appellant's minor case claim; and

   (b)the respondent's counterclaim.

2. So far as the appellant's minor claim is concerned, her Honour was entitled in considering whether to grant an extension of time to appeal to take into account the merits of the appellant's case.  In that regard, her Honour noted the respondent's statement of defence to the minor case claim and the manner in which the matter was to be defended.  In particular, the defendant had pleaded both the first deed of settlement and the second deed of settlement as being a bar to any subsequent claims by the appellant.  Furthermore, her Honour noted that the respondent was no longer the receiver/manager of Mt Richon.  Consequently, her Honour, in considering the merits of the claim generally and the likelihood of success was entitled to come to the conclusion that (ts 9):

   In my view [the appellant] is precluded by not only the deed of settlement but also more generally at law.  So in my view the claimant's claim has no merit and on that basis and for the other reasons I have outlined, the extension of time for appeal is refused.

1. Consequently, I find that the learned magistrate was entitled to, and properly did, refuse the extension of time to appeal in relation to the appellant's minor case claim.

Counterclaim

1. So far as the counterclaim is concerned, I note that the learned magistrate made no reference in her decision to the counterclaim.  It is clear that the appellant sought to rely upon and elaborate upon the decision of Shenton v Touchstone.

2. In the absence of any reference to the counterclaim itself I am left with the only conclusion that the learned magistrate simply failed to address the issue.

3. In the circumstances it is my view that the appellant has been denied procedural fairness so far as it relates to the counterclaim.  Consequently, I would allow the appeal only in so far as it relates to the counterclaim. 

4. In answer to the specific issues articulated for consideration in this appeal pursuant to the orders of her Honour Judge Schoombee in chambers on 18 August 2014 I rule as follows:

   (a)The decision by Magistrate Zempilas to refuse an extension of time for the appeal from the registrar is a judgment and consequently s 32(2) of the MCCPA allows the appeal.

   (b)Her Honour, Magistrate Zempilas, denied natural justice to Mr Shenton because she did not allow him to develop his argument that the damages relating to the counterclaim were unliquidated and that the decision of Shenton v Touchstone Farms applied.

   (c)The decision of Magistrate Zempilas to deny natural justice to Mr Shenton at the hearing of the appeal only affected her decision on the counterclaim (and not on the claim).

   (d)Having decided the issues at (a) – (c) above, I am of the view, notwithstanding the delay, that an extension of time to bring the appeal to the District Court should be granted in the circumstances but only as it relates to the determination of the counterclaim.

5. My orders are as follows:

   1.The decision of Magistrate Zempilas refusing to allow an extension of time to appeal pursuant to s 29 of the MCA is set aside and I order that an extension of time to appeal to a magistrate be granted in relation to the respondent's counterclaim only.

   2.The appeal is otherwise dismissed.

   3.The matter be remitted to the Magistrates Court for rehearing in relation to the counterclaim only.

   4.That the appellant pay the respondent's costs of the appeal in relation to the minor case claim, such costs to be taxed in the absence of agreement between the parties.