YYW Financial Pty Ltd v Tarrawarra Yarra Valley Holding Pty Ltd & Ors (Ruling)

[2025] VCC 537

IN THE COUNTY COURT OF VICTORIA

AT MELBOURNE

COMMERCIAL DIVISION

Revised
Not Restricted
Suitable for Publication

BANKING AND FINANCE LIST

Case No. CI-24-02875

YYW FINANCIAL PTY LTD (ACN 665 147 044)	Plaintiff
v
TARRAWARRA YARRA VALLEY HOLDING PTY LTD (ACN 663 012 512) as trustee of Tarrawarra Yarra Valley Holding Unit Trust and own capacity	First Defendant
HUU LOI YARRA VALLEY PTY LTD (ACN 633 876 454) as trustee of Huu Loi Yarra Valley Unit Trust and in its own capacity	Second defendant
HOA KIM DAI	Third defendant
LOI HUU NGUYEN	Fourth defendant
QUANG LE HUYNH	Fifth defendant

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JUDGE:	HIS HONOUR JUDGE WISE
WHERE HELD:	Melbourne
DATE OF HEARING:	11 April 2025
DATE OF RULING:	11 April 2025
CASE MAY BE CITED AS:	YYW Financial Pty Ltd v Tarrawarra Yarra Valley Holding Pty Ltd & Ors (Ruling)
MEDIUM NEUTRAL CITATION:	[2025] VCC 537

REASONS FOR RULING
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Subject:Strike out of pleadings                 

Catchwords: Practice and procedure, striking out of defence, non-compliance with Court orders, failure to provide further and better particulars, Order 24.02 of the County Court Civil Procedure Rules 2018.

Legislation Cited:      

Cases Cited:Lenijamar Pty Ltd v AGC (Advances) Limited (1990) 27 FCR 388; Professional Administration Service Centres Pty Ltd v Commissioner of Taxation (2012) 295 ALR 52; Mainstream Construction (Aust) Pty Ltd v Carr Electrical Pty Ltd [2014] VSC 317; Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397; [1988] FCA 364

Ruling:See paragraphs 17 & 20.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr D Kim	EXC Law
For the Defendants

HIS HONOUR:

1The plaintiff makes an application pursuant to Order 24.02 of the County Court Civil Procedure Rules seeking that the second and fourth defendants’ defences be struck out for a failure to have provided particulars of their defence pursuant to orders of this Court.  The first order was made by Judicial Registrar Bennett on 13 August 2024 – paragraph 6.  The second order was made by Judicial Registrar Muller on 22 November 2024 – paragraph 3.  The third order was made by Judicial Registrar Bennett on 17 January 2025 – paragraph 1.  The second and fourth defendants have not complied with any of those orders.

2The request for particulars was served on 26 August 2024 by letter from the plaintiff’s solicitor to the second and fourth defendants’ then solicitor on the record.  The request for further and better particulars is extensive, and, as I have just indicated in my discussion with counsel for the plaintiff, I consider many of those requests to be in a proper form such as to have required the second and fourth defendants to provide a response.  There are a number of those requests that I would regard as not being in proper form, generally because they are more in the nature of interrogatories or because they adopt a rolled-up request seeking further particulars on terms “mutatis mutandis” by reference to other requests within the document.  I regard a request for particulars in that fashion to be problematic, in that it requires the party responding to form their own view and make their own changes to the earlier request in order to understand what is being requested of them.  Nevertheless, it is plain that there are numbers of requests that have not been answered when they ought to have been, and, in consequence, it is the case that the second and fourth defendants are in breach of orders.

3It is true that no self-executing order was made; however, I do not regard that as being of any moment.  The fact is that three sets of orders have been made requiring these particulars to be provided, and they have not been complied with.

4Order 24.02 of the Rules reads as follows

“(1)Where a party fails to comply with an order to give particulars of any pleading ... the Court may order—

(a)...;

(b)if the party is a defendant, that the defendant’s defence, if any, be struck out.

(2)   A defendant whose defence is struck out in accordance with paragraph (1)(b) shall, for the purpose of Rule 21.02(1), be taken to be a defendant who, being required to serve a defence, does not do so within the time limited for that purpose.”

5The principles and authorities relevant to the application of r 24.02 are well known.  In Lenijamar Pty Ltd v AGC (Advances) Limited (1990) 27 FCR 388, Wilcox and Gummow JJ said (at page 395-6):

“It is to be noted that the power given by this rule is conditioned on one circumstance only: the failure of a party to comply with an order of the Court directing that party to take a step in the proceeding.  There is no requirement of intentional default or contumelious conduct, although the attitude of the applicant to the default and the Court’s judgment as to whether or not the applicant genuinely wishes the matter to go to trial within a reasonable period will usually be important factors in weighing the proper exercise of the discretion conferred by the rule.  There is no requirement of “inordinate and inexcusable delay” on the part of the applicant or the applicant’s lawyers, although any such delay is likely to be a significant matter.  There is no requirement of prejudice to the respondent, although the existence of prejudice is also likely to be significant.  And it must be remembered that, in almost every case, delay adversely affects the quality of the trial and is an additional burden upon the parties.”

6These observations were applied in the Full Court of the Federal Court in Professional Administration Service Centres Pty Ltd v Commissioner of Taxation (2012) 295 ALR 52, where, “under the umbrella” of the “overriding consideration” of the question of injustice, the following non-exhaustive list of relevant considerations was set out (at pages 62-63):

“(i)the nature of the default involved;

(ii)     the duration of the default and whether it is continuing;

(iii)    the circumstances in which the orders, in respect of which default has occurred, were made including whether the orders made accorded with the practice of the Court in making orders of that kind;

(iv)   the circumstances which occurred between the time of making the orders and the order for the dismissal of the proceeding, including whether any attempt was made by the defaulting party to amend or set aside the orders to accommodate or deal with these intervening circumstances;

(v)    whether the continuing default is occasioning unnecessary delay, expense or other prejudice or unacceptable burden on the respondent;

(vi)   the attitude of the applicant to the default and the Court’s judgment as to whether or not the applicant genuinely wishes the matter to go to trial within a reasonable period;

(vii)   the stage that the proceeding has reached – whether they have only recently been commenced; whether it has been commenced for some time but not advanced due, in whole or in part, to the default; or whether the proceeding is in an advanced state ready or nearly ready for hearing;

(viii)  the likely disruption to hearing dates or, if not fixed, to setting the matter down for hearing at an early date;

(ix)   the consequences to the applicant of dismissing the proceeding.”

7This list of considerations was approved by Cavanough J in Mainstream Construction (Aust) Pty Ltd v Carr Electrical Pty Ltd [2014] VSC 317 in allowing an appeal from an Associate Judge dismissing proceedings for non-compliance with procedural orders. Those are the considerations that I should take into account in determining this application.

8I have before me an affidavit in support of the application sworn by Mr Aaron Xia, solicitor for the plaintiff, on 25 February 2025.  He has set out the history of the proceeding and the history of dealings between the parties in respect of this request for further and better particulars.  It is apparent that despite the defendants, through their solicitors, having accepted that the request for further and better particulars must be answered, and having advised that they were in the process, through their solicitors and/or counsel, of doing so, no such answers have been provided.  This is in the face of multiple orders having been made requiring them to do so, including, as I am informed, the order on 17 January 2025, which was made by consent.

9I note that the proceeding is at a fairly early stage; that is, pleadings are not yet closed.  It is my view that, as submitted by the plaintiff, they are not in a position to file a reply to the second and fourth defendants’ defence because that defence is inadequately particularised.  The consequence is that the proceeding has been delayed from the time that their request for particulars was served on 26 August 2024 to today.  This has had the consequence of stalling the proceedings for a period of eight months, which is clearly unacceptable.

10I note that the nature of the default involved is one of a seemingly, and without the benefit of any proper explanation from the second and fourth defendants, intentional or at least reckless refusal to comply with the orders.  I note that that refusal or failure to comply is continuing.  I note also that the circumstances in which the orders were made were in accordance with the ordinary practice of this Court, in that where allegations of the nature that were made in the second and fourth defendants’ defence required proper particularisation in order for the issue to be properly joined with a reply, the consequences are that the relevant issues cannot be properly articulated for trial.

11I do note that the second and fourth defendants’ solicitors came off the record some time ago.  I also note that communication has been had with a new firm of solicitors, Macpherson & Kelley, who I understand have on occasions signed-off on consent orders purporting to act on behalf of the second and fourth defendants.  Macpherson & Kelley have not formally come on the record as acting for the second and fourth defendants.  However, I am prepared to assume that to the extent that they have purported to communicate with the plaintiff’s solicitors in this fashion, they did hold instructions to do so.  However, the plaintiff as a matter of caution, and noting that Macpherson Kelley were not formally on the record as acting for the second and fourth defendants, served those defendants with the materials in respect of this application by email to the last email address notified by the solicitors who came off the record as being an appropriate email address.  The consequence is that I am satisfied that the second and fourth defendants have had adequate notice of the hearing today but have elected not to attend.

12This is a further circumstance that leads me to conclude that those defendants simply do not intend to comply with the Court orders to answer the request for further particulars.

13For those reasons, I am satisfied that their continuing default is occasioning unnecessary delay and expense and prejudice to the plaintiff.

14I can only assume that the second and fourth defendants’ attitude to the default is one of indifference, and I am also able to infer that they have no particular desire to have the matter go to trial within a reasonable period.

15It is the practice of this Court to fix the trial date at the first directions hearing.  That is indeed the case in this matter.  The proceeding has been set down for trial on 3 September 2025.  Noting that pleadings have not yet closed as a consequence of the second and fourth defendants’ default, I must infer that the trial date is in jeopardy.

16I am required to, and do, take account of the fact that, should I strike out the second and fourth defendants’ defence, it will be open to the plaintiff to enter judgment in default of defence.  Nevertheless, when faced with what appears to be recalcitrant defendants who do not comply with the Court’s procedural orders designed to move the case to a determination in a cost-effective and timely manner, the consequence that judgment may be entered against them is a matter entirely of their own making.

17For all of those reasons, I am satisfied that it is appropriate for me to exercise my discretion under r 24.02(1)(b) that the second and fourth defendants’ defence filed 19 July 2024 be struck out.

18The plaintiff applies to have their costs of this application paid by the second and fourth defendants on an indemnity basis.  They say that this ought to be done because the second and fourth defendants’ conduct in failing to comply with the order for further and better particulars is recalcitrant, and was done in the face of adequate and appropriate explanations by the plaintiff as to the need for those particulars to be provided.  There is substantial force in these submissions.

19Having regard to the nature of the order that is sought under paragraph 24.02, in the absence of having heard from second and fourth defendants, and the circumstances which enliven the Court’s discretion and indeed the factors relevant to the exercise of the discretion, it seems to me that the second and fourth defendants should have known that their refusal to provide the particulars was without excuse and done without any legal justification.  Under those circumstances, I consider that there is “evidence of particular misconduct that causes loss of time to the court and the other parties:” Colgate Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248, such that it is appropriate to exercise my discretion in favour of making an order for indemnity costs.

20Under those circumstances I will order the second and fourth defendants to pay the plaintiff’s costs of and incidental to this application on an indemnity basis.

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Certificate

I certify that these 7 pages are a true copy of the reasons for ruling of His Honour Judge Wise delivered on 11 April 2025.

Dated: 2 May 2025

Liam Crough

Associate to His Honour Judge Wise.