Tradebart Pty Ltd v Stutterheim - [2007] SADC 40

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Minor Civil Review)
TRADEBART PTY LTD v STUTTERHEIM
[2007] SADC 40
Judgment of His Honour Judge Chivell
24 April 2007
MAGISTRATES - APPEALS FROM AND CONTROL OVER MAGISTRATES - SOUTH AUSTRALIA
REVIEW OF MINOR CIVIL ACTION - LIMITATION OF ACTIONS - PARTNERSHIP - STAY OF PROCEEDINGS - FORUM NON CONVENIENS
Review of a minor civil action. Action dismissed by Magistrate on basis that, firstly, an extension of time to institute the proceedings should not be granted, secondly, that there is no cause of action against the defendant, and thirdly, that the action would have been stayed as insufficient nexus between cause of action and South Australian jurisdiction.
Held: refusal to grant extension of time without inquiring into the merits inappropriate; cause of action does exist against defendant pursuant to Partnership Act 1891; no grounds for a stay. On the merits, application for extension of time pursuant to s48 Limitation of Acts Act 1936 refused.
Application for review dismissed.
Limitation of Actions Act, 1936 s35, s48(3) & (4); Magistrates Court Act s38; Partnership Act, 1891 s6(1), referred to.
Voth v Manildra Flour Mills Proprietary Limited and Another (1990) 171 CLR 538; Agri-Best Aust P/L v Lodhias Ltd & Ors [2005] SADC 139; Lovett v Le Gall (1975) 10 SASR 479, applied.

TRADEBART PTY LTD v STUTTERHEIM
[2007] SADC 40

This is an application by Tradebart Pty Ltd (“Tradebart”) to review a decision of Ms S E O’Connor SM in a minor civil action in the Magistrates Court of South Australia on 29 November 2006. Both parties were represented by counsel by mutual agreement. Mr Scerri appeared for the applicant/plaintiff and Ms Connolly appeared for the respondent/defendant. The decision is described as a “ruling”, but her Honour dismissed Tradebart’s claim, thereby finally disposing of the action between the parties.
Tradebart’s claim against the defendant, who was alleged to have been trading as Frankston Office Equipment at the relevant time, was for $2,390.28, and it was described as an action to recover a debt. The particulars of claim read:
Outstanding Cash Fees $427.46 ..... Membership and Administration Fees Outstanding Trade Account $552.34 ..... from 29^th November 1999 +2% interest per month $1410.48 .....
Cause of action is one of contract entered into at Level 1, 78-86 Anzac Highway, Everard Park SA 5035 and arose closest to Adelaide Magistrates Court.
The Claim was filed on 7 August 2006 and served by post on the defendant, who lives in Dundowran Beach, Queensland.
As the cause of action, being one of simple contract, arose more than six years prior to the issue of the proceedings, the claim was statute‑barred (s35, Limitations of Actions Act, 1936) unless the time is extended by a court pursuant to s48 of that Act.
The Claim was not endorsed with a statement to the effect that the plaintiff sought an extension of time, as is required by s48(4) of that Act.
Mrs Stutterheim filed a Defence, dated 18 August 2006, in which she disputed the alleged debt, and stated that the business ceased operating in 1998. She said she moved to Queensland in 1999.
The trial was listed for 29 November 2006. Mr Kellie appeared for the plaintiff, and Mrs Stutterheim participated by telephone link from Queensland. She had also written a letter, dated 18 November 2006, outlining her position, a summary of which was that:
·the claim arose no later than November 1999, and was therefore outside the “statutory of limitations to claim this money”;
·the debt was denied.
In that letter was the following statement:
Tradebart was well aware that the business which we had in Frankston was closed on 30/11/98 and therefore we were no longer in business (my underlining).
It is not clear to me what transpired at the hearing on 29 November 2006. No transcript was taken, and no exhibits marked. Certain documents appear in the file, presumably handed to the Magistrate at the hearing by Mr Kellie.
The learned Magistrate gave ex‑tempore reasons for her ruling. The reasons commence as follows:
¹In relation to this matter, Mr Kellie has asked me to grant an adjournment. He wants me to grant an adjournment because he lodged his claim on 7 August 2006 for $2,390.28 and when he reviewed his file last night he considered his claim may be out of time. He has spoken to a solicitor and was told that he may be able to obtain an extension of time in which to commence proceedings because the defendant was out of the State. That advice does not apply to this situation.
The reference to the defendant being out of the State seems to be a reference to s39 of the Limitation of Actions Act 1936, which states:
If any person against whom there is any such cause of action as is referred to in section 35 or 36 was at the time when the cause of action accrued absent from the State the party entitled to the action may commence it within the time limited by this Act after the return of that person from beyond the seas as if that had been the time at which the cause of action accrued.
I agree that this section is not apposite to the situation here. Her Honour went on to say:
³Under S.38 of the Magistrates Court Act, it is up to the court to determine the procedure to be adopted in determining a claim, taking into account the duty of the court to act in accordance with equity and fairness between the parties. I am not prepared to grant an adjournment in these proceedings as I do not consider any legal advice will save the day for Mr Kellie and I will now publish the reasons why.
It would appear that when considering whether the plaintiff might have been able to apply for an extension of time, her Honour confined herself to s39. She did not specifically refer to s48 of the Limitations of Actions Act which gave the Court power to extend the time for bringing the action, although she did refer to the power to extend in general terms.
Her Honour gave three reasons for dismissing the plaintiff’s claim:
⁹Tradebart’s claim fails. Firstly it will be dismissed because it is out of time. There were only six years in which to commence these proceedings and there is good reason why the South Australian Parliament has determined that that should be the limitation period: for exactly the matters raised by Mrs Stutterheim in these proceedings. I would not grant an extension of time. I have no idea why Mr Kellie left this so late. If it was due to the fact of not being able to find a defendant, then so be it. That is just a matter of luck or bad luck.
¹⁰Secondly I dismiss the claim as there is no cause of action against this woman. I do not agree with Mr Kellie’s assessment that because she was a partner with her husband that she can be liable on a membership agreement that was entered into and signed by her husband alone.
¹¹Thirdly, if I am wrong in relation to those two points, I would have no hesitation in granting a stay of proceedings. Mr Kellie on numerous occasions has appeared before me where he has filed proceedings which I consider should be properly dealt with in another State. There is very little nexus between this State and this claim. This contract was entered into with a couple who were trading in Victoria. The named defendant has been residing in Queensland since 1999. I accept that it would be highly prejudicial to expect her to travel to Adelaide for Tradebart’s convenience and I grant a stay of proceedings. If I was wrong in relation to jurisdiction, if I was wrong in relation to any cause of action against this particular defendant, in the alternative I would have granted a stay. But this is obviously not my order. I dismiss the claim because it is out of time and I make no order as to costs.
In my opinion, her Honour erred when she dismissed the plaintiff’s claim without inquiring into the merits of his foreshadowed application for an extension of time. Section 38 of the Magistrates Court Act states:
(1)     The following provisions are applicable to the trial of a minor civil action:
(a)     the trial will take the form of an inquiry by the Court into the matters in dispute between the parties rather than an adversarial contest between the parties;
(b)     the Court will itself elicit by inquiry from the parties and the witnesses, and by examination of evidentiary material produced to the Court, the issues in dispute and the facts necessary to decide those issues;
(c)     the Court may itself call and examine witnesses;
(d)     the parties are not bound by written pleadings;
(e)     the Court is not bound by the rules of evidence;
(f)    the Court must act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms.
Her Honour should have elicited whatever evidence Mr Kellie wished to produce in support of an application pursuant to s48 before dismissing the claim.
The first alternative ground for dismissal, that no cause of action existed, is also erroneous. The existence of a partnership was a matter of evidence. If proved, s6(1) of the Partnership Act 1891 would make Mrs Stutterheim liable if she were a partner. That section states:
An act or instrument relating to the business of a firm other than an incorporated limited partnership and done or executed in the firm‑name, or in any other manner showing an intention to bind the firm, by any person authorised, whether a partner or not, is binding on the firm and all the partners.
It is also noteworthy that, in her letter, dated 18 November 2006, Mrs Stutterheim referred to the business “we had in Frankston”. Summary dismissal of the plaintiff’s claim in those circumstances was inappropriate.
The second alternative, namely that the proceedings should be stayed, was also misconceived. Mrs Stutterheim was living in Victoria when the cause of action arose. She moved to Queensland subsequently. The plaintiff had its registered office in, and carried on business in South Australia. That much was obvious from the application form.
There was no application for a stay. Mrs Stutterheim participated in the hearing by telephone, and there is no reason why the evidence at a full hearing could not have been taken by a similar method. It was through no fault of the plaintiff that Mrs Stutterheim lived so far away. A stay is an exceptional remedy, which should only be exercised on the basis of forum non conveniens if the South Australian court is a “clearly inappropriate forum” (see Voth v Manildra Flour Mills Proprietary Limited and Another (1990) 171 CLR 538 at 539, 564-5, 572, and the other authorities quoted by Millsteed DCJ in Agri‑Best Aust P/L v Lodhias Ltd & Ors [2005] SADC 139).
There are no grounds to find that the forum was clearly inappropriate. There were no grounds to stay the proceedings.
At the hearing of the application for review, and after hearing evidence from Mr Kellie, I gave leave to the plaintiff to amend the particulars of claim to add the endorsement required by s48(4) of the Limitations of Actions Act. The power to give such leave comes from Rule 279A(9)(e) of the District Court Rules, 2006. Mr Scerri relied on the evidence of Mr Kellie for the purpose of seeking to demonstrate that his client has an arguable case for an extension of time. If so, he submitted that I should find that the case should be remitted to the Magistrates Court for hearing.
To summarise, Mr Kellie said that in the course of his business he instituted about 20 or 30 similar actions a year. He said he knew that there was a time limit for bringing such an action of six years. He was of the view that a debtor had an obligation to advise him of a change of address. In the absence of such advice, he did not think that the time limit was a problem. He told me that they discovered Mrs Stutterheim’s address in the Electoral Roll some time in 2006. He was unaware whether any previous searches were done. Previously, searches of the “White Pages” telephone directories had failed. He acknowledged in cross‑examination that his company did not search the Register of Business Names, or other Australian Securities and Investment Commission records.
After an adjournment to enable Ms Connolly to get instructions from her client in Queensland, an affidavit of the defendant was filed. The affidavit refers to her “helping him out” in the business (para 6), and the fact that it was registered “in his own name” (para 5). There is no specific denial that she was a partner. In any event, that is a matter of evidence, not to be tried as a preliminary issue.
More to the point, however, Mrs Stutterheim deposed that she moved to Queensland in 1999, that she advised all relevant authorities of her change of address (para 10), and that in March 2000 she put her name on the Electoral Roll in Queensland. This is confirmed by a letter from the Divisional Returning Officer for the Division of Hinkler (exhibit MES-1). I accept that evidence.
Section 48(3) of the Limitation of Actions Act is as follows:
(3)     This section does not-
(a)     .....
(b)     empower a court to extend a limitation of time prescribed by this Act unless it is satisfied-
(i)that facts material to the plaintiff’s case were not ascertained by him until some point of time occurring within twelve months before the expiration of the period of limitation or occurring after the expiration of that period and that the action was instituted within twelve months after the ascertainment of those facts by the plaintiff; or
(ii)that the plaintiff’s failure to institute the action within the period of the limitation resulted from representations or conduct of the defendant, or a person whom the plaintiff reasonably believed to be acting on behalf of the defendant, and was reasonable in view of those representations or that conduct and any other relevant circumstances,
In my opinion, s48(3)(b)(i) does not assist the plaintiff. The ascertainment of the defendant’s address is not the ascertainment of a “fact material to the plaintiff’s case” within the meaning of that section.
In Lovett v Le Gall (1975) 10 SASR 479 at 481, Bray CJ with whom Walters and Wells JJ agreed, held that the interpretation of the expression “fact material to the plaintiff’s case” by the trial judge as “a fact relevant to the case in a not unimportant way” was correct. Putting it another way, Bray CJ said, at p483:
A fact is material within the meaning of the subsection if it is of such significance as to be able to influence the determination of the case.
Wells J might have suggested a wider interpretation, that is:
Facts that are not only relevant to the issues - which, I apprehend, may include the issue of damages - but are also of such a nature and of such weight that they may fairly be taken into account by a plaintiff who is in the course of considering whether he should or should not prosecute his claim to trial.
Similarly, the word ‘case’ has a much wider purview than the expression ‘cause of action’, it comprehends, in my opinion, all evidence, law and argument to be relied on in court by the party concerned. (my underlining).
In my opinion, the address of the proposed defendant does not fit into either definition of a fact material to the plaintiff’s case.
As to s48(3)(b)(ii), there is no evidence that the plaintiff’s failure to institute the action resulted from any representation or conduct by or on behalf of the defendant. There was never, at any stage, any impediment to him instituting proceedings. Service of the claim could have been affected by post at the registered office of the business (see Rule 46, Magistrates Court Rules). Any failure by the defendant to notify the plaintiff of a change of address merely goes to whether the proceedings could have been served, rather than whether they could be instituted.
For those reasons, I find that in the circumstances of this case, s48(3) of the Limitations of Actions Act prohibits an extension of the six year limitation period to bring such an action.
For those reasons, I conclude that the action was statute‑barred, and should therefore have been dismissed. The outcome in the Magistrates Court was therefore correct. The application for review is dismissed.
I will hear the parties as to costs.