Zielinski v Owners Corporation SP 18844
[2008] NSWSC 680
•7 July 2008
CITATION: Zielinski v Owners Corporation SP 18844 [2008] NSWSC 680 HEARING DATE(S): 2 July 2008
JUDGMENT DATE :
7 July 2008JURISDICTION: Common Law JUDGMENT OF: Harrison AsJ DECISION: (1) The orders made by Registrar Bradford dated 1 April 2008 are set aside.
(2) The plaintiff is to pay the defendant's costs thrown away on 25 March 2008, 1 April 2008 and the costs of the notice of motion dated 29 April 2008. Such costs to be paid forthwith.
(3) The plaintiff is to file and serve any affidavit (including the transcript) upon which she relies by 21 July 2008.
(4) The matter is listed for a Status Conference before the Registrar on 28 July 2008 at 9.00 am.CATCHWORDS: RESTORE MATTER - Whether matter should be restored to the list LEGISLATION CITED: Strata Scheme Management Act 1996
Uniform Civil Procedure RulesCATEGORY: Procedural and other rulings CASES CITED: Thompson v Parker (1933) 49 CLR 507 TEXTS CITED: Strata Scheme and Community Scheme Management and the Law, Lawbook Company 3rd ed 1998 PARTIES: Danuta Zielinski (Plaintiff)
The Owners' Corporation Strata Plan 18844 (Defendant)FILE NUMBER(S): SC 30133/2007 COUNSEL: M Duncan (Plaintiff)
G Gemmell (Defendant)SOLICITORS: McCabe Terrill Lawyers (Defendant) LOWER COURT JURISDICTION: Supreme Court LOWER COURT FILE NUMBER(S): 30133/2007 LOWER COURT JUDICIAL OFFICER : Registrar Bradford LOWER COURT DATE OF DECISION: 1 April 2008
IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
ADMINISTRATIVE LAW LISTASSOCIATE JUSTICE HARRISON
MONDAY, 7 JULY 2008
JUDGMENT (Whether matter should be restored30133/2007 - DANUTA ZIELINSKI v THE OWNERS
CORPORATION STRATA PLAN 18844
to the list)
1 HER HONOUR: By notice of motion filed 29 April 2008, the plaintiff seeks an order that the orders made by Registrar Bradford on 1 April 2008 be set aside on the grounds set out in the affidavit of Frank Pacer sworn 28 April 2008. On 1 April 2008, Registrar Bradford made orders that the proceedings be dismissed and that the plaintiff pay the defendant’s costs.
2 The plaintiff is Danuta Zielinski. The defendant is the Owners Corporation Strata Plan 18844. The plaintiff relied on an affidavit of Frank Pacer sworn 28 April 2008. Mr Frank Pacer is the husband of the plaintiff who has for some years been suffering from recurrent effects of breast cancer. The plaintiff has appointed Mr Pacer to have conduct and control of all matters to do with her case. Mr Malcolm Duncan of counsel has been briefed to appear on behalf of the plaintiff in the appeal of this matter. The defendant relied on the affidavits of Kevin Allan GibbonS dated 22 May 2008 and 19 June 2008.
3 On 3 December 2007, the plaintiff filed a summons seeking to appeal the Magistrate’s decision of 27 August 2007. The costs order was entered on 6 November 2007. The summons stipulates that the plaintiff’s address for service PO Box 2098 Strawberry Hills NSW 2016.
4 The grounds of appeal are firstly, that the Magistrate erred as a matter of law in that she gave a verdict in a monetary sum against the weight of the evidence for $45,640.14; secondly, the Magistrate erred as a matter of law in that she found that the plaintiff below has standing to sue notwithstanding that the proceedings were brought in the name of an entity which did not exist at the time they were instituted; thirdly, on or about 22 June 2007 the Magistrate gave leave to the plaintiff below to file a second further amended statement of claim; fourthly, as a consequence of the leave to file a second further amended statement of claim under the Uniform Civil Procedure Rules, the pleadings were re-opened; fifthly, within time, the defendant/cross claimant below filed and served an amended defence and cross claim to the second further amended statement of claim; sixthly, the Magistrate erred as a matter of law in that she, on 24 July 2007, then withdrew the leave for the plaintiff to file the second amended statement of claim, disallowed the filing of the amended defence and cross claim to that pleading and entered judgment for a sum in accordance with the original statement of claim disregarding the payments that had been made in reduction of the sum claimed, and made orders for payment of interest disregarding the sums paid in reduction of the original claim and dismissed the cross claim; seventhly, the Magistrate erred as a matter of law in that she did not admit into evidence an affidavit of Steve Tamas sworn 21 June 2007 attesting to the loss of rental income suffered by the defendant/cross claimant as a result of which, the amount awarded by the Magistrate to the plaintiff was excessive and against the weight of the evidence which should have been admitted; and eighthly, the Magistrate erred as a matter of law in that she did not have proper regard to the evidence before her as a result of which she dismissed the cross claim in its entirety notwithstanding that she had sworn evidence before her that the defendant/cross claimant had suffered pecuniary loss by reason of the failure of the plaintiff to effect repairs to the defendant/cross claimant’s lot and/or the common property.
The rules
5 The plaintiff relied on r 36.16 and r 49.19 of the Uniform Civil Procedure Rules.
6 Rule 36.16 reads:
“36.16 Further power to set aside or vary judgment or order
(2) The court may set aside or vary a judgment or order after it has been entered if:(1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order.
(a) …
(c) …(b) it has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order, or
(b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief.(a) …, or
(3A) …
(3B) …
(4) Nothing in this rule affects any other power of the court to set aside or vary a judgment or order.”(3C) …
7 And r 49.19 reads:
If a registrar gives a direction or makes an order or does any other act in any proceedings, the court may, on application by any party, review the direction, order or act and make such order, by way of confirmation, variation, discharge or otherwise, as the court thinks fit.”“Review of registrar’s directions, orders and acts
8 The more appropriate rule is 36.16 as the order for dismissal was made in the absence of the plaintiff.
History of case management
9 On 29 January 2008, the matter was listed before Registrar Bradford for directions. Mr Duncan sought an adjournment on behalf of the plaintiff as his was waiting for a copy of the Local Court transcript. The defendant consented to the adjournment and the matter was stood over to 25 March 2008 for a telephone conference. Both parties provided the Registrar with their contact telephone numbers.
10 On 25 March 2008, the plaintiff’s counsel failed to attend the telephone conference before the Registrar. The plaintiff’s counsel Mr Duncan has admitted that he failed to diarise the matter. The plaintiff’s non attendance on 25 March 2008 was due to the plaintiff’s counsel’s oversight. Had Mr Duncan appeared, the matter would have been unlikely to have been given a hearing date as a copy of the transcript was not available.
11 On 25 March 2008, Registrar Bradford made orders firstly, that the proceedings be stood over for a telephone conference on 1 April 2008; secondly, the Court to advise the plaintiff at PO Box 2098, Strawberry Hills 2016 (my emphasis) and requested that the plaintiff provided to the Court telephone contact details; and thirdly, the defendant’s solicitor to advise the plaintiff of these orders. Costs were reserved.
Three letters forwarded to Ms Zielinski advising of the Court hearing on 1 April 2008
12 On 25 March 2008, the Court wrote two letters to Ms Zielinski at her address nominated for service. The first letter advised her of the Registrar’s orders (as outlined above) and notified her of the telephone conference to be held on 1 April 2008 at 11.30 am. The second letter notified Ms Zielinski that pursuant to r 13.6 the proceedings were adjourned for a telephone conference on 1 April 2008 and that if there was no attendance by or on her behalf on that day the Court may dismiss the proceedings. Mr Pacer attached a copy of this latter letter to his affidavit as annexure “A”.
13 On 27 March 2008, Mr Gibbons the defendant’s solicitor also wrote to the plaintiff at PO Box 2098 Strawberry Hills 2010 [my emphasis] advising her of the Court orders made on 25 March 2008. The letter read:
- “We advise we appeared on 25 March 2008. There was no appearance on your behalf. The matter has therefore been stood over for directions to 1 April 2008, for a teleconference. You have received a letter from the Court to that effect. If there is no appearance by you on the next occasion, we will be asking the Court to dismiss proceedings and will be asking for costs in that event. Further, if proceedings continue, we will be seeking costs in relation to 25 March 2008 and 1 April 2008.”
14 Mr Pacer attached a copy of this letter to his affidavit as annexure “B”.
15 Mr Pacer deposed that he checked the post office box at approximately 3.00 pm on 27 March 2008 and at approximately 10.00 am on 1 April 2008 before he left for the Central Coast and that the letter from the Court (Annexure A) was not in the post box (Aff [9]).
16 Mr Pacer deposed that the letters (annexures A and B) were first received by him when he checked the post box at approximately 4.30 or 5.00 pm on 4 April 2008 (three days after the hearing) when he returned from interstate. What happened to the other letter from the Court also dated 25 March 2008 is a mystery as Mr Pacer does not refer to that letter at all.
17 I closely observed Mr Pacer when he gave evidence and was cross examined. I found him generally to be an unimpressive witness. He was at times argumentative and evasive. He gave evidence that he had been told by Mr Duncan the next court date was 25 March 2008 and that he assumed that Mr Duncan of counsel would attend on that day. That assumption is of course a reasonable one. He also gave evidence that shortly after 25 March 2008 he phoned Mr Duncan and asked him “What’s going on. Have you heard?” but he cannot remember Mr Duncan’s reply. He did not refer to this alleged telephone conversation in his affidavit. I found his answer that he could not recall what Mr Duncan replied to be evasive particularly because the whole purpose of his making the telephone call to Mr Duncan was to find out what happened on 25 March 2008.
18 The onus was on the plaintiff to provide a proper address for service. The postcode provided by the plaintiff for Strawberry Hills, namely 2016, is incorrect. An Australia Post postcode search reveals that the postcode for Strawberry Hills is either 2012 or 2013 (Ex 1). Accordingly, the Court sent its notifications to the wrong postcode namely 2016. The defendant’s solicitor changed the postcode to 2010 in his letter but that postcode was incorrect. The plaintiff explained that 2016 is the postcode for Redfern but the mail nevertheless makes its way to his mailbox at Strawberry Hills. This explanation is not plausible.
19 The address postcode problem has now been rectified. The plaintiff has now provided a proper address for service to the Court. On 19 June 2008, the plaintiff filed a notice of appointment of solicitor with his address for service.
20 Even though I found Mr Pacer’s evidence unimpressive, as the mail was addressed to the wrong postcode and the time period allowed for receipt was short, I cannot find in the circumstances, that Mr Pacer actually received these letters prior to the court hearing on 1 April 2008. As previously stated, on 1 April 2008, there was no appearance by or on behalf of the plaintiff and Registrar Bradford dismissed the proceedings.
21 Normally if the plaintiff provides a satisfactory explanation for his or her non attendance the matter would be restored to the list subject to the costs orders being made against the defaulting party. The reason for this approach is the recognition of the entrenched principle that a party should be afforded the opportunity to have its case heard on its merits.
22 However, the defendant’s counsel objected to the matter being restored to the list for five reasons. They are firstly, that there has been accord and satisfaction between the plaintiff and defendant; secondly, the plaintiff is estopped from asserting a right of appeal given that she settled her difference with the defendant by accepting the offer of costs and accepting the figure of the outstanding levies; thirdly, that to restore the matter to the list would be futile given the way in which the appeal is framed; fourthly, the explanation for the non attendance at the Court on 1 April 2008 is inadequate; and fifthly, prejudice.
23 The last three reasons do not, in my view, preclude the matter from being restored to the list. I shall deal with these three issues first. So far as futility is concerned, the defendant submitted that the plaintiff is required to seek leave to appeal. I agree. The plaintiff may even need to seek an order for an extension of time to file the appeal. These are not fatal flaws as leave can be sought. The seeking of leave does not change the substance of the grounds of appeal which have already been articulated in the summons. So far as the merits of the appeal are concerned, in my view, the grounds of appeal are weak but at least arguable. I have accepted the plaintiff’s explanation for the non attendance at court.
24 The defendant submitted that an order for costs on the ordinary basis, assuming the defendant is successful in defeating the appeal, will still leave the defendant with an amount it has to pay for the gap between solicitor/client costs and costs on an ordinary basis. That is, the defendant says it will have suffered a detriment if this matter is allowed to continue. Nevertheless, the usual rule, that prejudice caused to the defendant can be cured by costs, is in my view applicable in the current circumstances.
25 The two remaining reasons are firstly, accord and satisfaction; and secondly, estoppel. The defendant submitted that there has been accord and satisfaction between the parties and referred to four documents. They are the letter from One Title Conveyancing to Bright & Duggan (agents for the defendant) dated 17 and 18 October 2007, the letter from McCabe Terrill Lawyers dated 22 October 2007 and the receipt for the amount paid on settlement.
26 The letter from One Title Conveyancing dated 17 October 2007 is unequivocal in its terms: “… in order to make a full and final settlement between the parties…”. The second letter dated 18 October 2007, accepts the offer to settle costs for $50,000, provisionally accepts the offer to settle levies as per the judgment and asked for final calculations. The final calculations are provided in the letter from McCabe Terrill Lawyers dated 22 October 2007. There remained a dispute about the figure proposed. The full amounted requested by the defendant of $99,676.85, was paid to it on settlement of the unit. Even if an appellant pays an amount owing under a judgment entered in a lower court they are not precluded from appealing that decision. Just because the plaintiff paid the moneys, in my view, does not preclude an appeal being instituted. In any event, while it appears that there was an agreement regarding the payment of costs, the plaintiff still disputed the amount owing.
27 That leaves the estoppel point. The defendant submitted that the plaintiff settled her differences with it by accepting the offer of costs and accepting the figure of the outstanding levies. The plaintiff is not appealing the costs part of the decision. However, if the plaintiff were to be successful on appeal, I accept that the costs order may be varied.
28 The defendant says that the plaintiff settled her differences with the defendant and granted the s 109 certificate and the defendant did so relying on the representation that the matter was resolved – see Thompson v Palmer (1933) 49 CLR 507 at 547.
29 K R Handley in Estoppel by conduct and election, (2006) Sweet & Maxwell at 75, stated that the representee must prove that it changed its position and would be disadvantaged by this if the representor was not required to adhere to his representation. This required three elements, namely inducement, change of position and detriment.
30 The defendant further submitted that it accepted that the matter was resolved when the plaintiff accepted the offer of settlement and directed that the amount agreed be paid on settlement. My reading of that letter suggests that the sum (other than costs) was still in dispute. The defendant changed its position by agreeing to settle the issue of costs, by issuing the certificate for the amount it did and by attending on settlement to accept the moneys paid by the incoming purchaser.
31 The defendant says that detriment is proven by the fact that it is currently responding to an appeal in the Supreme Court following the sale of the unit and they no longer have the same protection in relation to costs in the same way had the unit not been sold, that is, had the certificate not been provided. This is in part because of the provisions of s 80 of the Strata Scheme Management Act 1996 which provides for the recovery of “expenses” – see Ikin in Strata Schemes and Community Schemes Management and the Law, 3rd ed 1998 Lawbook Company at 238 where he states:
- “If an owners corporation has to sue an owner in the courts to recover unpaid contributions or interest on those contributions, the owners corporation is also entitled to recover from the owner any expenses of the owners corporation incurred in recovering the contribution or interest – s 80(1). This means that the legal costs and disbursements charged by the solicitor and barrister to act for the owners corporation to recover the contributions and interest from the recalcitrant owner can be claimed, dollar for dollar, from the owner.”
32 The plaintiff did not make a representation that it would not appeal the decision of the Local Court. In my view, if there is an estoppel it relates only as to the costs component of the judgment.
33 The exercise of the discretion contained in r 36.16 is discretionary. I have considered the factors referred to earlier and the decision is a borderline one. In my view in the exercise of my discretion, the summons should be restored to the list so that the appeal can be heard on its merits. Hence, I set aside the orders made by Registrar Bradford dated 1 April 2008.
34 So far as costs are concerned, the plaintiff was the one who did not provide a proper address for service and it was more than likely that this caused the delivery of mail to be delayed. Mr Pacer also knew of the court hearing listed on 25 March 2008. According to Mr Pacer’s own evidence, he telephoned Mr Duncan to find out what happened on 25 March 2008 but he says that he cannot remember what Mr Duncan told him. The onus was on the plaintiff to ensure he attended court when the matter was listed. Mr Pacer could have either phoned Mr Duncan back to find out what happened or he could have made enquiries at the court registry. The plaintiff has been granted an indulgence by the Court. In these circumstances the plaintiff is to pay the defendant’s costs thrown away on 25 March 2008, 1 April 2008 and the costs of this motion. These costs are to be paid forthwith.
The Court orders
(1) The orders made by Registrar Bradford dated 1 April 2008 are set aside.
(2) The plaintiff is to pay the defendant’s costs thrown away on 25 March 2008, 1 April 2008 and the costs of the notice of motion dated 29 April 2008. Such costs to be paid forthwith.
(4) The matter is listed for a Status Conference before the Registrar on 28 July 2008 at 9.00 am.(3) The plaintiff is to file and serve any affidavit (including the transcript) upon which she relies by 21 July 2008.
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