Smith v Blackberry Nominees Pty Ltd

[2022] WASC 225

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION:   SMITH -v- BLACKBERRY NOMINEES PTY LTD [2022] WASC 225

CORAM:   PRINCIPAL REGISTRAR MCDONALD

HEARD:   30 JUNE 2022

DELIVERED          :   8 JULY 2022

PUBLISHED           :   8 JULY 2022

FILE NO/S:   CIV 2961 of 2018

BETWEEN:   NATHAN DUDLEY SMITH

Plaintiff

AND

BLACKBERRY NOMINEES PTY LTD

First Defendant

AARON DUDLEY SMITH

Fourth Defendant

LYNTON DUDLEY SMITH

Plaintiff by counterclaim

NATHAN DUDLEY SMITH

Defendant by counterclaim

Catchwords:

Practice and procedure – Application for extension of time to comply with springing order – Action dismissed and judgment entered – Preliminary issue whether power to extend time or whether appeal necessary – Rules of the Supreme Court 1971 (WA) O 3 r 5

Legislation:

Rules of the Supreme Court 1971 (WA), O 3 r 5

Result:

Finding made on preliminary issue

Category:    B

Representation:

Counsel:

Plaintiff	:	B J Dalitz
First Defendant	:	P T Arns
Fourth Defendant	:	A M Prime
Plaintiff by counterclaim	:	P T Arns
Defendant by counterclaim	:	B J Dalitz

Solicitors:

Plaintiff	:	Bailiwick Legal
First Defendant	:	Arns & Associates
Fourth Defendant	:	Anthony Prime Legal Services
Plaintiff by counterclaim	:	Arns & Associates
Defendant by counterclaim	:	Bailiwick Legal

Cases referred to in decision:

Avsar v Westland Healthcare Ltd [2007] WASCA 28

Bailey v Marinoff (1971) 125 CLR 529

Bevan v Bevan [2016] WASC 7

Biala Pty Ltd v Mallina Holdings Ltd (1989) 2 WAR 381

Brocx v Hughes [2008] WASC 34

CVW Group Holdings Pty Ltd v Addison [2011] WASC 267

FAI Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268

Lifelong Investments Pty Lt v Karageorge [2008] WASC 86

Marks v Emmanuel George Doukidis [2005] WASC 216

Melville v East End Holdings [2003] WASCA 133

Pollard v Incorporated Nominal Defendant [1972] VR 955

Rapid Metal Developments (Australia) Pty Ltd v Anderson Formrite Pty Ltd [2010] WASC 351

Skahill v Kestral Holdings Pty Ltd [2000] WASC 32

Skahill v Kestral Holdings Pty Ltd [2000] WASCA 185

Sommerville Kalgoorlie Pty Ltd v Gullen Pty Ltd [2022] WASC 115

PRINCIPAL REGISTRAR McDONALD:

Application

1. By summons dated 17 June 2022 the plaintiff applies for an extension of time in which to comply with two springing orders made on 22 September 2021 and 28 October 2021. The summons was returned on 30 June 2022 for directions and no issue was taken by the defendants that service of the application was effected on 29 June 2022.

Background

1. On 22 September 2021 I made orders that, unless within 21 days the plaintiff give discovery, the plaintiff's action against the second and third defendants be dismissed and judgment be entered on the second defendant's counterclaim with damages to be assessed. Service of the orders was effected on 28 October 2021 by way of substituted service.

2. On 28 October 2021 I made a further springing order for discovery against the plaintiff, this time on the application of the fourth defendant. The orders were served by way of substituted service on 6 November 2021.

3. The plaintiff did not give discovery and orders for the dismissal of the action and entry of judgment in favour of the second defendant's counterclaim were entered and extracted on 24 November 2021 and orders dismissing the action against the fourth defendant were entered and extracted on 2 December 2021.

4. The action remains on foot against the first defendant.

Issue

1. A preliminary issue is raised by the second, third and fourth defendants as to whether the plaintiff can apply to extend time in which to comply with springing orders that have already sprung and in respect of which orders for the dismissal of the action have been made and judgment for the second defendant has been entered.

2. The second and third defendants' submission is that the orders, which have been perfected, are unable to be recalled by the Court and the appropriate procedure is to apply to set aside the judgments by way of appeal pursuant to O 60A r 4(1) of the Rules of the Supreme Court 1971 (WA) (RSC). The fourth defendant adopts the second and third defendants' submissions.

Order 3 rule 5 of the RSC

1. The plaintiff says that O 3 r 5 of the RSC provides the statutory power which permits this Court, on such terms as it thinks just, to extend the time set under a self‑executing order even after the time for compliance has expired and final orders have been made.

2. Order 3 r 5 provides:

   Extending and abridging time

   (1)The Court may, on such terms as it thinks just, by order extend or abridge the period within which a person is required or authorised by these rules, or by any judgment, order, or direction, to do any act in any proceedings.

   (2)The Court may extend any such period as is referred to in subrule (1) although the application for extension is not made until after the expiration of that period.

   (3)The period within which a person is required by these rules, or by any order or direction, to serve, file or amend any pleading or other document may be extended by consent (given in writing) without an order of the Court being made for that purpose.

Relevant authorities

1. In Bailey v Marinoff[1] the High Court allowed an appeal against an order of the New South Wales Court of Appeal which extended time for the respondent to comply with a springing order made on 10 February 1970 in terms that unless the respondent file and serve appeal books by 31 March 1970, the appeal is to stand dismissed, such orders having been sealed and signed on 5 March 1970. Upon non‑compliance with the order, the appeal, in accordance with the order that had been made, stood dismissed.[2] Barwick CJ, agreeing with the majority of the Court, held that absent statutory provision the Court had no power to reinstate a proceeding of which it has finally disposed.[3]

   [1] Bailey v Marinoff [1971] HCA 49; (1971) 125 CLR 529, 530.

   [2] Bailey v Marinoff (531).

   [3] Bailey v Marinoff (530).

2. FAI General Insurance Co Ltd v Southern Cross Exploration NL[4] distinguished Bailey v Marinoff as being concerned only with the inherent power of the Court of Appeal in the absence of any statutory power.

   [4] FAI General Insurance Co Ltd v Southern Cross Exploration NL [1988] HCA 13; (1988) 165 CLR 268, 285 - 286.

3. Civil Procedure Western Australia cites FAI General Insurance Co Ltd v Southern Cross Exploration NL as the authority for the proposition that O 3 r 5 of the RSC allows the Court to extend time in which to comply with a springing order even after judgment has been entered after its automatic operation.[5]

   [5] LexisNexis, Civil Procedure Western Australia, vol 1 [3.5.6] and [43.0.19].

4. According to the defendants, if this is intended to mean that time to comply with a self‑executing order can be extended after the order has sprung and judgment has been entered and sealed by the court, that states the decision in FAI General Insurance Co Ltd v Southern Cross Exploration NL too widely.

5. In FAI General Insurance Co Ltd v Southern Cross Exploration NL[6] the High Court upheld the decision of the Court of Appeal which overturned the decision of the Judge at first instance who held he had no power to extend time to comply with a self-executing order pursuant to provisions equivalent to O 3 r 5 of the RSC.

   [6] FAI General Insurance Co Ltd v Southern Cross Exploration NL [1988] HCA 13; (1988) 165 CLR 268.

6. The decision of the majority in FAI General Insurance Co Ltd v Southern Cross Exploration NL was given by Wilson J, with whom Brennan, Deane and Dawson JJ agreed. Wilson J reviewed the authorities and held in relation to the equivalent provision:[7]

   It is a remedial provision which confers on a court a broad power to relieve against injustice. The discretion so conferred is not readily to be limited by judicial fiat. The fact that it manifestly is a power to be exercised with caution and, in the case of conditional orders, with due regard to the public policy centred in the finality of litigation does not warrant an arbitrary limitation of the power itself, not expressed in the words of the rule, so as to deny its capacity to apply to circumstances such as those which are to be found in the present case. It would be wrong to so read the rule as to deny to a court power to prevent injustice in circumstances where the party subject to a conditional order ought to be excused from non-compliance.

   [7] FAI General Insurance Co Ltd v Southern Cross Exploration NL (283 - 284).

7. Wilson J distinguished Bailey v Marinoff on the basis the Court in that case was concerned only with the inherent power of the Court of Appeal and the case involved the powers of an appellate court and not a judge of first instance.[8] Wilson J went on to further distinguish Bailey v Marinoff by reference to the fact that the matter had been finally disposed of by order duly entered.[9]

   [8] FAI General Insurance Co Ltd v Southern Cross Exploration NL (283).

   [9] FAI General Insurance Co Ltd v Southern Cross Exploration NL (285).

8. It is also worth noting that Wilson J did not agree with the approach taken in the Victorian Court of Appeal in Pollard v Incorporated Nominal Defendant.[10] In Pollard v Incorporated Nominal Defendant the Court of Appeal held that there was no power to enlarge time once the self‑executing order had elapsed. At first instance the Master made an order on 28 April 1971 that failure to provide answers to interrogatories within seven days of service of the order would result in the defence being struck out and the defendant placed in the same position as if it had not defended the action. The order was served on 29 April 1971 and the plaintiffs caused judgment to be entered on 18 May 1971. The defendant sought an extension of time in which to comply with the orders by way of summons dated 24 June 1971, after judgment had been entered by the Court.

   [10] Pollard v Incorporated Nominal Defendant [1972] VR 955.

9. Wilson J in FAI Insurance Co Ltd v Southern Cross Exploration NL made reference to Pollard v Incorporated Nominal Defendantand held:[11]

   The Court after referring to a number of cases, including Whistler and Bailey, expressed the opinion that 'once any proceedings, whether final or interlocutory, have been concluded by a court order which has fully taken effect so as to create new rights and obligations as between the parties then those proceedings may properly be treated as dead, subject only to appeal'. Holding that view, the Court limited the power to enlarge time conferred by O 64, r 6 of the Rules of Court, a rule comparable though not identical to Pt 2, r 3, so as to have no application in such a case. For the reasons I have expressed, I am unable to take the same view of Pt 2, r 3.

   [11] FAI General Insurance Co Ltd v Southern Cross Exploration NL (285 - 286).

10. What followed the passage in Pollard v Incorporated Nominal Defendant quoted by Wilson J, made it clear that the Victorian Court of Appeal considered that the proceedings were 'dead' after the expiration of the time fixed by the springing order. Wilson J disagreed with this proposition in light of the statutory power to extend time, but did not indicate whether the power to extend time was confined to the period up and until judgment was formally entered and orders perfected.

11. The defendants' submission is that in FAI General Insurance Co Ltd v Southern Cross Exploration NL judgment had not been entered and perfected. The ability to extend time referred to by Wilson J operates only until orders for the dismissal of the action have been made or judgment has been entered. Counsel for the second and third defendants cited Gaudron J in FAI General Insurance Co Ltd v Southern Cross Exploration NL who also dismissed the appeal but for different reasons:[12]

    Although the rule that a court may not vary a duly entered order which brings proceedings to a conclusion rests, at least in part, on the obvious desirability that litigation should be brought to an end, the converse of that rule viz. that a court of record may vary an order before the order is entered must rest on the notion that a court is not functus officio whilst there remains any judicial function which may be performed in relation to a proceeding, even if it be only that of ensuring that the final order correctly records the meaning of the court.

    [12] FAI General Insurance Co Ltd v Southern Cross Exploration NL (289).

12. Gaudron J nevertheless held there seems to be no relevant distinction to be made between a proceeding in which a conditional order for dismissal has been entered and a proceeding in which an order has been made but not entered, but did not need to decide the matter in the absence of a direct challenge to previous authority, including Bailey v Marinoff.[13]

    [13] FAI General Insurance Co Ltd v Southern Cross Exploration NL (290).

13. The plaintiff relies on those cases which have applied FAI General Insurance Co Ltd v Southern Cross Exploration NL to resolve the contended ambiguity about its application to this case.

14. In Melville v East End Holdings Inc,[14] the Court of Appeal held FAI General Insurance Co Ltd v Southern Cross Exploration NL provides authority to extend time for compliance with a springing order even after judgment has been entered by its automatic operation.[15] In Melville v East End Holdings Inc, the Court of Appeal upheld an appeal against the decision to refuse to extend time to comply with a springing order pursuant to O 3 r 5 with the consequence that judgment was entered accordingly.

    [14] Melville v East End Holdings Inc [2003] WASCA 133.

    [15] Melville v East End Holdings Inc [16] - [17].

15. Counsel for the second and third defendants distinguished Melville v East End Holdings Inc on the basis that the application to extend time to comply with the springing order at first instance was brought before judgment had been entered. Therefore, the decision does no more than confirm there is power to enlarge time after the time for compliance with a springing order has expired.

16. Skahill v Kestral Holdings Pty Ltd,[16] involved a similar dispute to this application. A registrar made a springing order against the plaintiffs which was not complied with and judgment was entered for the defendants some five days after the order sprung. The plaintiffs appealed the decision of the registrar to make a springing order whereas the defendants contended that, properly characterised, the plaintiffs were seeking an extension of time to comply with the springing order and they should be proceeding under O 3 r 5. The Master held:[17]

    This is a problem which has arisen in the past and it is not entirely clear from the Rules as to which is the proper way to proceed. In my view, where a party seeks an extension of time to comply with a springing order, that application ought ordinarily be made to the Case Management Registrar … in my view the power to extend time in relation to a case management direction is available under O 29A r 12(c) … it is preferable if the Case Management Registrar who has made the springing order first deals with any application for an extension of time. The familiarity of the Case Management Registrar with the file puts the Registrar at an advantage in dealing with an application at first instance.

    [16] Skahill v Kestral Holdings Pty Ltd [2000] WASC 32.

    [17] Skahill v Kestral Holdings Pty Ltd [6].

17. On an application for leave to appeal, the Court of Appeal noted in Skahill v Kestral Holdings Pty Ltd:[18]

    There was some controversy whether it was proper for the plaintiffs to proceed by way of appeal or whether they were seeking an extension of time within which to comply with the springing order. The Master seems to have been of the view that the proper course was to apply under O 3 r 5(2) for an extension of time: see FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268 at 283 - 84. Nothing turned on the controversy for the purpose of the Master disposing of the application.

    [18] Skahill v Kestral Holdings Pty Ltd [2000] WASCA 185 [4].

18. Counsel for the second and third defendant submits that to the extent that there was any confusion about the appropriate way to proceed, the repeal of O 29A and the gazettal of O 60A r 4 of the RSC now makes it clear that '[a] party who is dissatisfied with an order or decision of a registrar may appeal from it.' However, there is no material distinction between the rules referred to Skahill v Kestral Holdings Pty Ltd and those currently in operation. The now repealed O 29A r 12(c) permitted a registrar to amend or cancel a case management direction. That power is replicated in O 4A r 2 (3)(b) of the RSC. Order 60A was inserted before Skahill v Kestral Holdings Pty was decided[19] and at that time O 60A r 4(1) was in similar terms to its current version.[20]

    [19] Government Gazette 28 October 1996, p 5701

    [20] O60A r 4 (1) of the RSC: 'Subject to paragraph (6), a person affected by an order or decision of a Registrar may appeal from it.' Paragraph (6) is not relevant to this application..

19. The plaintiff further relies on Avsar v Westland Healthcare Ltd,[21] in support of the proposition that an application to extend time should be made to the case manager and not dealt with by way of an appeal. In Avsar v Westland Healthcare Ltd, the appellant sought a stay of a springing order made by the District Court requiring compliance with earlier programming orders. There was some dispute as to whether the order had sprung. The Court of Appeal held at [19] that the dispute as to whether the springing order had sprung and, if the order had sprung, any application to extend time for compliance with the springing order, should be made in the District Court referring to FAI General Insurance Co Ltd v Southern Cross Exploration NL,[22] and Skahill v Kestral Holdings Pty Ltd.[23]

    [21] Avsar v Westland Healthcare Ltd [2007] WASCA 28 [19].

    [22] FAI General Insurance Co Ltd v Southern Cross Exploration NL (286).

    [23] Skahill v Kestral Holdings Pty Ltd [4].

20. Counsel for the second and third defendants distinguish Avsar v Westland Healthcare Ltd,[24] on the basis judgment had not been entered at first instance.

    [24] Avsar v Westland Healthcare Ltd [2007] WASCA 28.

21. In the course of argument, counsel for the plaintiff, referred to those authorities cited in Civil Procedure Western Australia which dealt with springing orders for failure to provide discovery[25] and in which judgment had been entered upon non-compliance.

    [25] LexisNexis, Civil Procedure Western Australia, vol 1 [26.15.03].

22. In CVW Group Holdings Pty Ltd v Addison,[26] the defendants appealed a registrar's order that unless the defendants gave discovery within 10 days, the defence be struck out and judgment be entered for the plaintiff. The order was made on 13 December 2010 and the appeal against the order was made on 16 December 2010. The time for compliance with the springing order expired on 23 December 2010. The attempts by the defendants to stay the operation of the order were ineffective and on 17 January 2011 the plaintiff entered judgment pursuant to that order.

    [26] CVW Group Holdings Pty Ltd v Addison [2011] WASC 267.

23. On appeal, Le Miere J held that the court had power to extend the time for compliance with a springing order even after judgment had been entered and permitted the defendants to make an application.[27] On 21 June 2011 the defendants applied by way of summons to set aside the judgment entered on 17 January 2011 and extend time to comply with the springing order, which was dealt with by his Honour as part of the appeal. The appeal was allowed against the springing order and judgment was set aside. His Honour held:[28]

    An extension of the time to comply with a springing order may be granted under O 3 r 5 RSC notwithstanding that a judgment has been entered upon proof of default: FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268, 286. The court has a discretion whether to extend time.

    [27] CVW Group Holdings Pty Ltd v Addison [8].

    [28] CVW Group Holdings Pty Ltd v Addison [36].

1. His Honour held that if he had not allowed the appeal against the order of the registrar, he would have extended time for the defendants to comply with the orders.[29]

   [29] CVW Group Holdings Pty Ltd v Addison [44].

2. Similarly in Bevan v Bevan,[30] A/Master Gething, considered the Court's power to set aside judgment. Relying on FAI General Insurance Co Ltd v Southern Cross Exploration NL, the A/Master held:[31]

   The second instance is that if the order made by the master had been a springing order, and judgment had been entered as a result of non-compliance, it is clear that the court has the power pursuant to RSC O 3 r 5 to enlarge the time for compliance, thereby causing the judgment to be set aside.

   [30] Bevan v Bevan [2016] WASC 7.

   [31] Bevan v Bevan [17].

3. In Rapid Metal Developments (Australia) Pty Ltd v Anderson Formrite Pty Ltd,[32] Le Miere J dealt with an application to set aside judgment and extend time to comply with a springing order pursuant to O 3 r 5 notwithstanding that judgment had been entered for non-compliance with a springing order.[33]

   [32] Rapid Metal Developments (Australia) Pty Ltd v Anderson Formrite Pty Ltd [2010] WASC 351.

   [33] Rapid Metal Developments (Australia) Pty Ltd v Anderson Formrite Pty Ltd [1], [3], [8]. See also Lifelong Investments Pty Lt v Karageorge [2008] WASC 86 [2], [17]; Marks v Emmanuel George Doukidis [2005] WASC 216 [10]; Brocx v Hughes [2008] WASC 34 [31].

4. In Biala v Mallina[34] the Court of Appeal upheld the order of Rowland J to extend time to comply with an order of Seaman J pursuant to O 3 r 5 of the RSC which, although did not result in the dismissal of the action, had been settled, passed, entered and extracted pursuant to O 42 of the RSC.

   [34] Biala Pty Ltd v Mallina Holdings Ltd (1989) 2 WAR 381.

5. The defendant refers to Sommerville Kalgoorlie Pty Ltd v Gullen Pty Ltd,[35] in which an appeal was brought, after judgment had been entered, against the decision of a registrar to make a springing order for failure to comply, rather than seek an extension of time in which to comply. There is no doubt an appeal is open. However, that of itself does not foreclose an application pursuant to O 3 r 5, as shown in CVW Group Holdings Pty Ltd v Addison.

   [35] Sommerville Kalgoorlie Pty Ltd v Gullen Pty Ltd [2022] WASC 115.

Conclusion

1. The defendants' submission that FAI General Insurance Co Ltd v Southern Cross Exploration NL permits the time for compliance with springing orders to be extended only until the entry of judgment or orders for the dismissal of the action being perfected, is not a distinction that has been made by numerous decisions in this Court by which I am bound.

2. It is clear from the authorities cited above that O 3 r 5 provides an exception to the general principle that perfected orders must generally be varied by appeal.

3. For that reason the preliminary point of whether it is open to the plaintiff to make an application pursuant to O 3 r 5 to extend time for compliance with the springing orders made on 22 September 2021 and 28 October 2021, even though the action has been dismissed against the second, third and fourth defendants and judgment entered on the second defendant's counterclaim, is answered in the affirmative.

4. I will hear the parties as to the appropriate programming orders.

I certify that the preceding paragraphs comprise the reasons for decision of the Supreme Court of Western Australia.

LH

Associate to Principal Registrar McDonald

8 JULY 2022