Strathfield Group Ltd v Overton
[2013] QCAT 212
| CITATION: | Strathfield Group Ltd v Overton [2013] QCAT 212 |
| PARTIES: | Strathfield Group Limited (Applicant) |
| v | |
| David Overton and and Glenys Overton (Respondents) |
| APPLICATION NUMBER: | RSL071-10 |
| MATTER TYPE: | Retail shop leases matters |
| HEARING DATE: | 6 May 2013 |
| HEARD AT: | Brisbane |
| DECISION OF: | Dr J R Forbes (Chairman) Ms S M Kairl, Member Mr D McBryde, Member |
| DELIVERED ON: | 6 May 2013 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. The Notice of Dispute filed herein on 29 July 2010 is dismissed. 2. The Respondents are at liberty to file and serve a particularised claim for costs of and incidental to proceedings in the Tribunal no later than 4 pm on Friday 31 May 2013. 3. If any such claim is made, the Applicant may file a response no later than 4 pm on Friday 14 June 2013. 4. The conclave listed for 29 May 2013 is vacated. 5. The Tribunal Hearing listed for 15, 16 and 17 July 2013 is vacated. |
| CATCHWORDS: | RETAIL SHOP LEASE – NOTICE OF DISPUTE – late compliance with directions – non-compliance with directions – no reasonable explanation – prejudice to opponent – question of striking out or dismissal initiated by Tribunal – order striking out Notice of Dispute – liberty to apply for costs Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3, s 32, s 48 Corporations Act 2001 (Cth) s 553C Dick v Piller [1943] KB 497, cited Miller v Director of Public Prosecutions (NSW) (2004) 145 A Crim R 95, cited Minister for Immigration and Multicultural Affairs v Capitly (1999) 55 ALD 365, cited Cook v ASP Ship Management Pty Ltd (2008) 105 ALD 453, cited Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230, cited |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (‘QCAT Act’).
REASONS FOR DECISION
On 1 August 2000 the Respondents (“the Overtons”) and the Applicant (“Strathfield”) became lessor and lessee respectively of retail premises at 125 Morayfield Road, Morayfield, Brisbane.
In mid-2010 the Overtons terminated the lease, alleging unpaid rent and damage to the premises.
After an unsuccessful application to the Supreme Court on 22 July 2010, details of which are not now material, Strathfield commenced these proceedings on 29 July 2010 under the Retail Shop Leases Act 1994 (“the RSLA”),[1] posing these issues:
a) Whether the Overtons unlawfully locked it out of the premises and repudiated the lease;
b) Whether the Overtons are entitled to the final month’s rent, make good and other amounts that they claim in the circumstances;
c) Whether Strathfield is entitled to compensation from the Overtons;
d) Whether the Overtons are entitled to deny Strathfield access to its goods and chattels.
[1] RSLA s 55.
On 25 January 2012 the Overtons notified the Tribunal of a proposed counterclaim. However, it was overtaken by Strathfield’s entry into a Deed of Company Arrangement[2] and need not detain us now. The present question is whether Strathfield’s Notice of Dispute should be struck out for want of prosecution, or as vexatious, or for failing, without reasonable excuse, and to the prejudice of the Overtons, to comply with directions of the Tribunal.[3]
[2]Corporations Act 2001 (Cth) s 553C, letter solicitors for Strathfield to Overtons 25 February 2012 and annexure.
[3] QCAT Act s 48(1)(a).
That necessitates a survey of sundry directions, failures of compliance or timely compliance, re-directions and extensions of time (the latter, chiefly for the benefit of Strathfield).
On 28 February 2012, after a jurisdictional question was resolved, Strathfield was ordered to file amended Points of Claim by 13 March 2012. That date came and went; compliance was almost four months late. Strathfield’s Points were eventually filed on 11 July 2012.
At the same Directions Hearing (28 February 2012) Strathfield was ordered to produce its witness statements and particulars of its damages claim by 27 April 2012. But it was not until 1 October 2012 that a draft statement by one witness, without necessary attachments, was produced, 3 months late.
By way of explanation it was said that Ms Bojanac of the firm of Somerset Ryckmans, Strathfield’s solicitors, was ill and unable to work from 2 July until 22 July 2012. That explanation, if accepted, does not explain the non-compliance with the Points of Claim order between 14 March and 1 July 2012. Nor does it justify non-compliance with the witness-statements order from 28 April 2012 to early October 2012.
In support of the claim that Ms Bojanac was ill in July 2012 Strathfield tendered a medical certificate of Dr Peter Wu dated 17 July 2012.[4] That rather uninformative 2-line document states that the writer “assessed” (rather than examined) Ms Bojanac on 17 July 2012, and retrospectively formed the opinion that on 2 July she became “unfit for work” for three weeks.
[4] Exhibit to affidavit by Martin Rosenblatt, a colleague of Ms Bojanac in the firm of
Somerset Ryckmans, sworn at Sydney on 2 October 2012.
But on 16 July 2012 Ms Bojanac emailed the Tribunal to say that she would not be available for a Directions Hearing on the following day, “due to other commitments”. The email bears Somerset Ryckmans’ letterhead, not a private address. It does not claim illness. Experience suggests that when people involved in litigation are indeed ill, they do not usually omit that explanation or excuse, even if they refrain from details.
Yet another Directions Hearing took place on 17 July 2012, with Ms Bojanac’s colleague, Mr Rosenblatt, for Strathfield. The presiding Member then warned the company that if it did not produce witness statements and particulars of damage by 31 July 2012 “dismissal of the proceeding [will] be considered.” Those directions had already been given on 28 February 2012.
Doubtless encouraged by that warning the Overtons applied for summary dismissal of the action, and costs, on 25 September 2012. They submitted, inter alia, that it was 5 months since Strathfield was ordered to produce its witness statements and particulars, and that, despite extensions of time, that material had not yet appeared. They added that the litigation had been “hanging over them for more than 2 years”, while their counterclaim was negated by Strathfield’s Deed of Arrangement in December 2011.
Thus galvanised, Strathfield filed an affidavit by its solicitor, Mr Rosenblatt,[5] referring to Ms Bojanac’s alleged inability to attend to the matter for 3 weeks in July 2012 and illness of Mr Hovanessian, a director of Strathfield. The Tribunal was told that in August-September 2012 that gentleman was disabled by a “pulmonary embolism”, and that from mid- to late September until 2 October 2012[6] he “has had limited availability to assist ... due to press of other business” and ill health. Later, Mr Hovanessian gave a different reason for his indisposition.[7]
[5] Sworn 2 October 2012, filed 8 October 2012.
[6] Rosenblatt’s affidavit was sworn on 2 October 2012.
[7] See paragraph [18], below.
The allegation of Hovanessian’s illness is not supported by any medical evidence.
Strathfield filed submissions in opposition to the strike-out application on 9 October 2012; the Overtons responded on 12 October 2012. We shall return to these documents in due course.
On 22 November 2012 the Tribunal refused to strike out Strathfield’s Notice of Dispute, observing that “there is no evidence ... to cast doubt” on Hovanessian’s claim of ill health. But with respect, this reverses the onus of proof. Absent the expense and logistics of a medical examination paid for by the Overtons – which Hovanessian would almost certainly have refused to undergo - it is difficult to see how the Overtons could effectively challenge his excuse. Where an application for an adjournment or extension of time is supported by credible medical evidence, it certainly deserves serious consideration,[8] but no such evidence has yet been produced. Self-serving claims of ill health can all too easily be made.[9] It is not surprising that the Tribunal eventually decided to call for medical evidence.[10]
[8] Dick v Piller [1943] KB 497; Rose v Humbles [1970] 1 WLR 1061;
Miller v Director of Public Prosecutions (NSW) (2004) 145 A Crim R 95.
[9]Minister for Immigration and Multicultural Affairs v Capitly (1999) 55 ALD 365 at 372; Cook v ASP Ship Management Pty Ltd (2008) 105 ALD 453.
[10] Directions Hearing 19 March 2013.
On 7 January 2013 the Tribunal ordered Strathfield to discover certain documents by 22 January 2013. On 26 February 2013 time for discovery was extended to 8 March 2013. Yet another Directions Hearing was listed for 19 March 2013.
On the day before that hearing, (of which 3 weeks’ notice was given) Hovanessian informed the Tribunal that he was unable to appear on Strathfield’s behalf. (As appears immediately below, Strathfield’s solicitors had withdrawn from the case.) Hovanessian’s letter of 18 March 2013 reads in part:
... I am unable to attend. The date of the hearing was set after my firm had already committed me to attending a conference in Hong Kong from Wednesday 20 to Friday 2 March 2013. I am leaving Sydney at 9 am tomorrow ... I have requested a non-executive director ... Mr Neil Gibson to attend by telephone on my behalf. Please note that Mr Gibson has only been briefed this morning and has no prior knowledge ... of the matter ... In December 2012 I had an invasive cancer operation ... followed up by another ... in February. I was recovering through February and part of March ... the operations got in the way of completing Disclosure Documents in time and I was unable to respond in a timely manner to my lawyers ... who then thought I had abandoned the case and withdrew ... However, the Applicant has certainly not abandoned the case ... [T]o provide the Discovery Documents I would need at least 60 days ...
The letter does not explain why the writer’s withdrawal from the Directions Hearing was notified at the last moment, or why the briefing of Mr Gibson was likewise delayed. Apparently Strathfield’s solicitors were less tolerant of delay than the Tribunal.
The Directions Hearing proceeded on 19 March 2013. Evidently the arrangement for Mr Gibson to replace his colleague fell through, because the Tribunal ordered, inter alia, that Strathfield explain its non-appearance by 28 March 2013.
Plainly the presiding Member’s patience, by that time, was badly frayed:
On the Tribunal’s initiative, the proceeding is listed for a hearing on the papers for the Tribunal to determine whether the Notice of Dispute should be struck out or dismissed.[11]
[11] Orders 19 March 2013 paragraph [1].
At the same time the Tribunal ordered Strathfield to explain on oath why orders for discovery and particulars made on 7 January 2013, and again on 26 February 2013 had not been obeyed, and to provide medical evidence in support of “any allegations of health issues”. The time limit for compliance was 28 March 2013.
Five weeks later, at the time of writing, the Registry confirms that those orders have not been complied with, and no request for an extension of time has been made.
So the question arises for the second time in these proceedings: Is it in the interests of justice that their labyrinthine course be ended?
Strathfield cannot hide behind its former solicitors. Ultimately the carriage of the matter is the responsibility of Strathfield’s officers. It is a fair inference from Hovanessian’s letter of 18 March 2013[12] that tardy or inadequate instructions eventually induced the solicitors to withdraw.
[12] Quoted in paragraph [18], above.
It is often said that it is a serious matter to dismiss a claim without a trial. Indeed that is so, but the discretion to strike out long-delayed or non-compliant proceedings depends upon the facts and circumstances of the case in hand. Strathfield has received numerous and tolerant concessions, and has had every opportunity to present its case.
The history of this matter features serial neglect of directions by the initiator of the action. Strathfield brought the Overtons to court but it is not entitled to detain them there indefinitely. On 19 March 2013 Strathfield was directed to do several things by 28 March. To date there has been no compliance. It is not surprising that the question of summary dismissal has been raised a second time – significantly, by the Tribunal itself.
In its response[13] to the first strike-out application,[14] Strathfield contended that it had caused no significant prejudice or “unnecessary disadvantage”[15] to the Overtons. If that was a viable argument in October 2012, it would be fanciful to accept it now. A trial date has had to be vacated; the Overtons have been required to attend several interlocutory hearings that should have been unnecessary, and time and again they have seen deadlines pass, only to be extended. Delay itself may raise a presumption of prejudice.[16] Even if default is not intentional or contumelious it may be so substantial and persistent as to warrant striking out an action.[17] In its October submission Strathfield confidently but inaccurately asserted:
The [Overtons] have not submitted any evidence of prejudice suffered by them by virtue of the manner in which [Strathfield] has conducted these proceedings. ... [They] make only the vague self-serving statement that they have had this matter “hanging over them for two years”.
[13] Filed on 9 October 2012.
[14] Filed by Overtons on 25 September 2012.
[15] QCAT Act s 48(1).
[16] Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 at 544, 556.
[17] Cooper v Hopgood & Ganim [1999] 2 Qd R 113 at 119 per Pincus JA; at 124 per
Derrington JA.
McPherson JA, in a strong Court of Appeal upholding a summary dismissal, firmly rejected that line of defence, and so do we:
[O]rdinary members of the community are entitled to get on with their lives and plan their affairs without having the continuing threat of litigation and its consequences hanging over them. The psychological as well as the commercial effects of such a state of affairs ought not to be underestimated.[18]
[18] Cooper v Hopgood & Ganim [1999] 2 Qd R 113 at 124.
Modern rules of practice recognise that litigation should be dealt with as speedily and economically as fairness allows.[19] They envisage -
a new statutory balance [between] ... efficiency and the delivery of individual justice. Delay and case backlog are not merely factors affecting the public cost of delivering justice; they [also] corrode the ability of the courts to provide individual justice.[20]
[19] QCAT Act s 3(b); Uniform Civil Procedure Rules 1999 (Qld) r 5(1).
[20] Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230 per Allsop ACJ at [36];
Crossman v Macquarie Leasing Pty Ltd [2013] NSWCA 62 at [23]; Howard v Francois
[2012] QCA 287.
Here the Tribunal has bent over backwards to be fair to a delinquent litigant. A bare summary of the glacial progress of this matter largely speaks for itself. Strathfield’s dilatory conduct might well be seen as an abuse of process. We have no confidence that, if these proceedings were allowed to continue, it would conduct them with any more expedition or attention to the Tribunal’s directions than in the past. We shall strike out the subject Notice of Dispute.
ORDERS
1. The Notice of Dispute filed herein on 29 July 2010 is dismissed.
2. The Respondents are at liberty to file and serve a particularised claim for costs of and incidental to proceedings in the Tribunal no later than 4:00 pm on Friday 31 May 2013.
3. If any such claim is made, the Applicant may file a response no later than 4:00 pm on Friday 14 June 2013.
4. The conclave listed for 29 May 2013 is vacated.
5. The Tribunal hearing listed for 15, 16 and 17 July is vacated.
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