Structum Pty Ltd v Mihalopoulos

[2019] NSWDC 24

District Court

New South Wales

Medium Neutral Citation:	Structum Pty Ltd v Mihalopoulos [2019] NSWDC 24
Hearing dates:	21 February 2019
Date of orders:	21 February 2019
Decision date:	21 February 2019
Jurisdiction:	Civil
Before:	Montgomery DCJ
Decision:	(1) Notice of Motion dismissed
Catchwords:	Interlocutory; Application to Vacate Hearing; Incarcerated Party Participating via AVL
Legislation Cited:	Crimes (Administration of Sentences) Act 1999 Evidence (Audio and Audio Visual Links) Act 1998
Category:	Procedural and other rulings
Parties:	Structum Pty Ltd (Plaintiff)  Basilios Mihalopoulos (First Defendant)  CWCN Pty Ltd (Second Defendant) (CAN 605 827 021)
Representation:	Counsel:  Mr S Robertson (Plaintiff) Dr G O’Shea (Defendants)   Solicitors: Mr M Perry (Plaintiff) Ms R Luk (Defendants)
File Number(s):	2018/168344
Publication restriction:	None

REVISED EXTEMPORE Judgment

1. HIS HONOUR: Judgment in notice of motion filed by the defendant 21 February 2019. By notice of motion filed 21 February 2019 the defendants seek orders that the hearing listed to commence today with an estimate of two days be adjourned, the order in appropriate form being that the date fixed for hearing be vacated. Further, and in the normal fashion that the matter be stood over for directions before the list judge on 21 March 2019.

2. Finally, the Notice of Motion deals with the question of costs thrown away by vacation of the hearing. The order sought is that the costs thrown away by the vacation of the hearing and costs on the Notice of Motion be adjourned for determination before the list judge on 21 March 2019.

3. In the motion the affidavits of Constantine Passas made 21 February 2019 and of Rosita Luk made 21 February 2019 were read. Objection was taken to paras 7 to 10 of the affidavit of Luk. I ruled those provisions admissible on the basis of information and belief of a solicitor in an affidavit prepared to assist the Court on short notice.

4. The short notice was consequent of circumstances, which could not have been known to the solicitor and in the course of these reasons I will come to those circumstances.

5. The plaintiff opposes the orders sought in the Notice of Motion.

6. These proceedings commenced by Statement of Claim filed 29 May 2018.

7. The defendants rely on amended defence filed 29 August 2018. The parties, in opening the case to the Court, for the purposes of the notice of motion, agreed that the nuts and bolts of the central issue of the case is whether the defendant is entitled to relief at common law and by statute from the consequences of a deed poll entered into in the course of a commercial relationship between the parties on 27 May 2017.

ROBERTSON: Of July, if your Honour pleases, the 28th.

HIS HONOUR: 28 July 2017. For the purposes of these reasons, dealing with the defendants' Notice of Motion only, it suffices to describe the dispute as whether or not the first defendant was incapacitated or otherwise entitled to relief from the consequences of the deed poll, on the basis that he was intoxicated at the time of its execution, justifying the forms of relief sought as properly pleaded in the amended defence, which incapacity was known to the officer of the plaintiff at the time of execution of the deed.

8. Significantly, the first defendant is both a party to the proceeding and the only witness for the defendant in relation to that central issue and factual context. Significantly, he is the sole director, secretary, and shareholder of the second defendant corporation‑‑

ROBERTSON: Was, if your Honour pleases.

O'SHEA: No, prior, he is no longer that, your Honour.

HIS HONOUR: Was he at the time of the execution of the‑‑

ROBERTSON: Was, at the relevant time, yes.

O'SHEA: Yes.

HIS HONOUR: I withdraw that last sentence. The first defendant was, at the time of execution of the deed, the sole director, secretary, and shareholder of the second defendant corporation. Significantly, the only witness in the plaintiff case as to the circumstances of the execution of the deed poll was an individual.

9. In other words, the factual matrix, identified above, will come through evidence of one witness for the plaintiff and one witness for the defendant. I repeat, the witness for the defendants being the first defendant. There is no contest of the fact of the deed, the construction of the deed, or the execution of the deed by the first defendant.

10. Dr O'Shea, who appears for the defendants appropriately and frankly assisted the Court with his concession that the defendants bear the burden of proof, at the civil standard, to satisfy the relief from the consequences of the deed poll sought in the amended defence. Indeed, the Court has been greatly assisted by the efficiency of counsel in the course of the day, particularly in regard to the obvious cooperation by parties in making inquiries as to the availability of audio‑visual link, to which I will come.

11. The affidavit of Mr Passas, to which I have referred conveys his observation at the Local Court of New South Wales at Burwood on 20 February 2019, that being yesterday, of proceedings involving the first defendant. On that day the first defendant was refused bail in relation to a charge or aggravated break and enter.

12. Legal representatives for the first defendant in those criminal proceedings are not the legal representatives of the defendants in these proceedings. This has led to scant information concerning those criminal proceedings and the prospects for bail as well as the time, which might accrue before the first defendant would be free in the community, if at all, for the purposes of attending a hearing in this civil jurisdiction. I will return to the substance of this. The affidavit of Ms Luk informed the Court, helpfully, of the MIN number for the first defendant in the Justice Department register concerning his being held at Surry Hills Police Station today.

13. It is apparent from that which has been said in court today, and from the affidavit of the solicitor, Ms Luk, that the course taken by the defendant in response to the circumstances of their instructing client, and central witness, being taken into custody yesterday was to correspond with the plaintiff seeking vacation of the hearing and offering costs thrown away by the vacation plus costs of the notice of motion.

O'SHEA: Taken into custody on Monday, if your Honour pleases.

HIS HONOUR: Thank you. I refer to para 11 of Ms Luk's affidavit, my reference to being taken into custody yesterday was a reference to be understood, for the purposes of this application, as not custody immediately consequent of arrest, but custody on remand consequent of bail refused. Charges having been introduced to the Court.

14. The significance of this is that, and I believe this to be uncontested ground, application for bail would now need to be made to the Supreme Court of New South Wales and that it would take some weeks before that application would be determined. For completeness, the first defendant entered custody on 18 February 2019 when he delivered himself to police consequent of being informed of charges - his being informed of charges is an assumption of my own, he may have been requested to attend a police station and was there charged. These things are not material to the present determination, but he has been in custody since Tuesday 18 February 2019.

O'SHEA: Sorry, your Honour, he has been in custody since Monday when he presented himself at the police station.

HIS HONOUR: That is the 17th.

ROBERTSON: Paragraph 8 of Mr Passas' affidavit says, "The 18th," but it may be wrong. My diary says 18th is the Monday.

HIS HONOUR: Monday was the 18th.

O'SHEA: Of course, sorry, yes, your Honour.

HIS HONOUR: So he has been in custody - is there any - I have got it right, have I not?

ROBERTSON: Yes.

HIS HONOUR: In that which I just said, he has been in custody since the 18th, which was the Monday, the commencement of this week, today being Thursday the 21st.

O'SHEA: Yes.

HIS HONOUR: I hope we deal with the complex issues because all of us lawyers are hopeless at the mundane, are we not?

ROBERTSON: Precisely so, 21 minus four is difficult for all of us, or minus three actually.

HIS HONOUR: We will return to the judgment. The practice of the District Court of New South Wales is that matters listed for hearing commence and run to completion, subject to the merits of the application to vacate the hearing being determined in the consideration of the cost effective and efficient conduct of litigation, and the overriding interests of justice.

15. Correspondence from the plaintiff to the defendants suggested consideration of evidence by audio‑visual link. The course of today, involved the parties representatives and this Court making numerous inquiries trying to satisfy the available alternatives, which might have availed the opportunity of the first defendant to attend personally in court.

16. I, for the Court, raised the realistic opportunity of audio‑visual link. Dr O'Shea, for the first defendant, clearly annunciated in an efficient and short way his opposition to conduct of the trial by audio‑visual link, on the basis of: firstly, the opportunity of the first defendant as a witness to display his credibility in the course of his evidence on the central issue; and secondly, but certainly not less importantly, the opportunity of the first defendant to instruct.

17. In relation to this latter matter I assured Dr O'Shea that for the purposes of instruction, were it required by AVL, I would vacate the Court in order for counsel and solicitors for the defendants to take instructions and to confer with their client.

18. Evidence of both parties is by affidavit, the defendants have no objections to the affidavits of witnesses of fact in the plaintiff case. The plaintiff has limited objections to the witness affidavits of fact in the defendant case; I am yet to deal with those objections. The opportunity of evidence by affidavit is the delivery of documents to the first defendant and for him to have them before him in the AVL suite. Counsel has confirmed with me that arrangements for this to occur have been put in train.

19. In this case, unlike another where affidavit evidence‑in‑chief is not by affidavit the defendants, meaning the first defendant, have notice of the factual case against them and the evidence in that case. This is particularly relevant to the expected need for instructions in the progress of a hearing. But also in regard to concern for the first defendant to obtain the view that, even if his evidence is by AVL, it is not a factual case heard for the first time by him in the circumstances such as if it were a hearing to run by oral evidence.

20. In the course of discussion between the Court and counsel, I indicated my view that, subject to the results of inquires being made by parties, the interests of justice, including that the proceedings be conducted in a way, which was not unfair to the first or second defendants, fell in favour of the imperfect course to conduct the hearing by the first defendant's evidence being received by AVL, and his participation in the hearing being by AVL.

21. I should make clear that the plaintiff has not, itself, made application for evidence by AVL. On the Court's inquiry of Mr Robertson of counsel for the plaintiff, his response was that, the plaintiff would, indeed, prefer to have, as I understood him, the opportunity of cross‑examination of the first defendant whilst he was present in the courtroom. But opposing the notice of motion for vacation, as the plaintiff does, the plaintiff does not oppose the first defendant's evidence being by AVL.

22. The difficulty is with availability of the first defendant in the hearing and having regard to the interests of effective conduct of litigation in this Court. Including the strong principle of practice in this Court that matters listed for hearing will run to conclusion unless circumstances of justice require otherwise.

23. I refer to the following matters:

• There is no evidence that, at the making of the application for bail before the learned magistrate the first defendant informed the Local Court of these proceedings and his want to be present. It is simply not known whether that was or was not done.

• There is no evidence other than the charge itself of the nature of the offence.

• Particularly, one notices that it is the charge of break and enter which incorporates the element of aggravation, there is no evidence of the nature of the aggravation. Aggravated break and enter is a serious offence, the consequence of which in this Court carries a substantial term of imprisonment as a head sentence in the event of a verdict of guilty. That the matter was returned yesterday before the learned magistrate is not an indication of whether or not the criminal matter will proceed in the Local Court or in this Court on indictment.

24. I mention these points as part of the overall observation that there is nothing before the Court upon which even a vague sense of prospects for success or otherwise that an application in the Supreme Court seeking bail might have. As I have said, the timing of that is at least weeks.

25. Mr Robertson, you did not read the affidavit of Marty Perry 21 February 2019, did you?

ROBERTSON: I didn't.

HIS HONOUR: Thank you. The sum‑‑

ROBERTSON: I may need to read it on costs in due course but I haven't read it so far.

HIS HONOUR: The sum in dispute is substantial. Paragraph 15 of the statement of claim states it as a debt due in the amount of $314,980.05. The plaintiff's allegation is that, consequent of the deed poll, that sum has been guaranteed by the first defendant personally and by - if I may call it such at the time - his company.

26. On the one hand, that observation weighs in the interests or favour of the first defendant in this problem of his availability for this hearing and in order for him to participate, not just as a witness but as a party - and indeed, a party against whom the whole of the debt, as the plaintiff describes the case, might fall personally. On the other hand, it is a substantial sum and a sum which may have a significant consequence for the plaintiff. There is no evidence before me as to that consequence but I raise the matter just as one of worldly experience in the context of the policy in this court of cost effective litigation, which includes efficient uses of the resources of the Court, with the demands upon it of litigants and the consequences they suffer not just in the result but in the delay of getting their day in court and determination of their disputes.

27. In the course of the day it was determined through the parties, and by the Courts own inquires within its administration, that if an order pursuant to s 77 of the Crimes (Administration of Sentences) Act 1999 were to issue there would be no custody court available today, Friday 22 February, or on any day of next week. And there may not be in the week after that.

28. This is because the custody courtrooms available to the Court are already allocated. It is not available to the Court by a s 77 order to have the first defendant brought into this civil precinct of John Maddison Tower where the requirements of s 77 would require Corrective Officers to be responsible for his custody and welfare.

29. This is because Corrective Services, according to the Court management's present understanding of Corrective facilities, would not be able to service accommodating an order for his attendance in this civil courtroom or any other civil courtroom in this complex.

30. In other words, there is no courtroom available in this complex of Downing Centre, John Maddison Tower, to which by s 77 order for the conduct of this hearing, the first defendant, as a prisoner on remand, could be brought.

31. This proposition crystallised the situation for determination of whether the hearing be vacated or proceed because it could only proceed by way of the first defendant's attendance being by AVL.

32. Inquires made by the parties permitted the Court to be informed from the bar table that the AVL suite at Surry Hills holding cells where the first defendant is presently situate would be available for him through the duration of this hearing.

33. On that basis the evidence in the hearing would commence at 10am tomorrow morning. It is already 20 past 3pm on 21 February 2019 as I speak. There is little, if anything, which will occur before 10am tomorrow morning. Dr O'Shea, for the defendants, assisted the Court by agreeing at about 1pm that the procedural matters of taking objections to affidavits, affidavits being read, for the Court to go off and read, is a process to which the defendants agree proceed in the absence of the first defendant prior to the availability of AVL tomorrow morning.

34. Section 5B of the Evidence (Audio and Audio Visual Links) Act 1998 permits the Court of its own motion to order, if the Court is satisfied that the interests of justice so require, that evidence proceed by AVL. There are numerous authorities concerning the imperfection of that process, particularly in a case such as this with one man's word against another being the crux of the factual determination. In the modern court system the taking of AVL evidence has become a virtually, whilst not every day, very frequent experience. In the criminal jurisdiction the evidence of complainants in sexual assault cases is, as a matter of practice, by AVL. In the criminal system evidence of complainants in a prosecution case and the central witnesses in a prosecution case regularly give evidence from all parts of the world by AVL.

35. It is recognised as imperfect but necessary in order for the demands of justice, as required by the community, including the efficient use of the court facilities, to be properly conducted and managed. In this case, unlike a criminal case, the first defendant has a judge as opposed to a jury. It is hoped that a judge, with the experience of the observation of evidence in court, is a factor somewhat lessening the risks of evidence by AVL. It is common ground between the parties and the court that it would be preferred that the first defendant give evidence personally in court. For the reasons I have stated, that is simply not available.

36. In all of the circumstances, exercising the discretion which is available to me, I consider it to be in the interests of justice and not unfair on balance of those interests that the proceedings continue through hearing by way of the first defendant's participation, including as a party, by AVL. I, however, provide a proviso in that consideration. That proviso is that if at any time in the opinion of Dr O'Shea, in his relationship to the Court as counsel - which the Court has the privilege of enjoying - is of the view that he wishes to raise any matter of discomfort with or disadvantage because of the hearing running by AVL, then he is free to raise that matter and a determination will then be made, whether or not the hearing continues by way of AVL.

37. It is important, before I make final orders, that I raise this question now. It is important because it is the Court, of its own authority under s 5B, to have proposed AVL. The plaintiffs have deliberately refrained from doing so. Should the hearing be interrupted because of the development of such an advantage, inconvenience to the parties would obviously occur. The extent of the inconvenience and of the delay is not available for measure, for the reasons which I have mentioned. In particular, that there is no evidence before the Court as to when or if the first defendant would either be free in the community or, by s 77 order, able to be brought to the District Court of New South Wales from prison to a custody court.

38. So before I go on to make the final orders, Mr Robertson, do you want to take any instructions as to whether I ought make the orders which obviously I have indicated I propose to make? Your client may prefer not to have something part heard. It is a matter for your client. There is a risk of it being part heard.

ROBERTSON: I don't need to be further heard on the substance of the orders that your Honour is contemplating. I do wish to be heard on costs separately.

HIS HONOUR: You do or don't?

ROBERTSON: I do wish to be heard on the costs of the‑‑

HIS HONOUR: Yes.

39. The orders I make are as follows:

1. Notice of motion dismissed;

2. The first defendant participate in the hearing, including in the giving of evidence by audio‑visual link;

3. The Court will be vacated during the periods required by counsel for the defendants to confer and/or take instructions from the first defendant;

4. The first defendant is to be informed that he is entitled at any time that he seeks to provide instructions he should indicate this to the Court and he will be given the opportunity to do so, subject to the Court coming to the view that this opportunity is not being used appropriately;

5. The first defendant is to have made available to him all documents which are to be referred to in the course of evidence.

6. I grant liberty to the defendants to make application to adjourn the hearing on the basis of disadvantage arising from the first defendant's participation by audio‑visual link, beyond the general imperfection of the opportunity of participation and to give evidence in person already recognised in these reasons.

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Decision last updated: 27 February 2019