FEDERAL COURT OF AUSTRALIA Ann Street Mezzanine Pty Ltd v Beck [2011] FCA 1212 Citation: Ann Street Mezzanine Pty Ltd v Beck [2011] FCA 1212 Parties: ANN STREET MEZZANINE PTY LTD ( IN LIQUIDATION) (ACN 102 854 866) v CEDRIC RICHARD PALMER BECK & ORS (ACCORDING TO ATTACHED SCHEDULE); NORMAN PHILLIP CAREY & ORS (ACCORDING TO ATTACHED SCHEDULE); FREEHILLS and AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION File number: VID 485 of 2008 Judge: KENNY J Date of judgment: 18 October 2011 Catchwords: PRACTICE AND PROCEDURE – application for extension of time to file documents – where springing or guillotine order in place – discretion to extend time for compliance – extension appropriate where in the interests of justice – consideration of the relevant circumstances – extension of time granted Cases cited: Smith v Barron (2004) 139 FCR 566 Aust-Pol Engineering Pty Ltd v Australian Maritime Safety Authority [1998] FCA 1198 Composite Buyers Ltd v JC Taylor Constructions Pty Ltd [1983] 2 VR 311 Ridge Lane Pty Ltd v Gadzhis [2007] VSC 212 Jorgensen v Slater & Gordon Pty Ltd [2008] VSCA 110 Pereira v Beanlands [1996] 3 All ER 528 Date of hearing: 18 October 2011 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 8 Counsel for the Cross-Claimant: Mr I D Martindale SC with Mr E F Wheelahan Solicitor for the Cross-Claimant: Metaxas & Hager Counsel for the First Cross-Respondent: Mr P Riordan SC Solicitor for the First Cross-Respondent: Monahan + Rowell Counsel for the Second Cross-Respondent: Ms K McMillan SC with Mr A Dinelli Solicitor for the Second Cross-Respondent: Johnson Winter & Slattery IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 485 of 2008 BETWEEN: ANN STREET MEZZANINE PTY LTD ( IN LIQUIDATION) (ACN 102 854 866) Plaintiff AND: CEDRIC RICHARD PALMER BECK & ORS (ACCORDING TO ATTACHED SCHEDULE) Defendants NORMAN PHILLIP CAREY & ORS (ACCORDING TO ATTACHED SCHEDULE) Cross-Claimants FREEHILLS First Cross-Respondent AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Second Cross-Respondent JUDGE: KENNY J DATE OF ORDER: 18 OCTOBER 2011 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. Orders 8 and 11 - 17 of the orders made by Justice Kenny on 8 September 2011 be vacated. 2. The time for the cross-claimants to file a list of the documents upon which, at the time the list is prepared, they anticipate they will wish to rely on at trial be further extended until 4.00 pm 28 October 2011. 3. The cross-claimants have leave to file the supplementary affidavit of Norman Phillip Carey sworn on 13 October 2011 and the supplementary affidavit of Graeme John Rundle sworn on 13 October 2011. 4. The cross-claimants have leave to file an amended cross-claim against the first cross-respondent in the form provided to the court on 17 October 2011. 5. The second cross-respondent have leave to file and serve a defence to the amended cross-claim in the form filed on 14 October 2011. 6. On or before 14 November 2011 the cross-respondents file any affidavits, and, in the case of expert witnesses, affidavits and reports, upon which they wish to rely at the trial, or in the case of witnesses who decline to swear or affirm affidavits, a written outline of the evidence which the solicitors for the relevant cross-respondent expects such a witness will give at the trial. 7. On or before 14 November 2011 the cross-respondents file a list of the documents upon which, at the time the list is prepared, they anticipate they will wish to rely on at trial. 8. On or before 16 November 2011 the cross-claimants file two copies of an indexed and paginated court book containing in chronological order a copy of each document upon which any party seeks to rely. 9. On or before 16 November 2011 the cross-claimant file an outline of submissions. 10. On or before 21 November 2011 the cross-respondents file their outline of submissions. 11. The cross claims be set down for trial commencing on 21 November 2011 with an estimate of three weeks, upon the basis that such three weeks may not be continuous. 12. The cross-claimants pay the cross-respondents' costs of the cross-claimants' interlocutory application filed on 17 October 2011 and any costs thrown away by reason of the cross-claimants' non-compliance with the Orders of 8 September 2011. 13. Liberty to apply on reasonable notice. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 485 of 2008 BETWEEN: ANN STREET MEZZANINE PTY LTD ( IN LIQUIDATION) (ACN 102 854 866) Plaintiff AND: CEDRIC RICHARD PALMER BECK & ORS (ACCORDING TO ATTACHED SCHEDULE) Defendant NORMAN PHILLIP CAREY & ORS (ACCORDING TO ATTACHED SCHEDULE) Cross-Claimants FREEHILLS First Cross-Respondent AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Second Cross-Respondent JUDGE: KENNY J DATE: 18 OCTOBER 2011 PLACE: MELBOURNE EX TEMPORE REASONS FOR JUDGMENT 1 On 8 September 2011, the Court made orders in this proceeding, including orders that: 6. The time for cross-claimants to file any affidavits, other than affidavits of expert witnesses, that they wish to rely upon at the trial, or in the case of witnesses who decline to swear or affirm, a written outline of the evidence which the solicitors for the cross-claimants expect such witnesses will give at the trial be extended to 30 September 2011. 7. The time for the cross-claimants to file affidavits and reports that the expert witnesses will give at the trial be extended to 14 October 2011. 8. The time for the cross-claimants to file a list of the documents upon which, at the time the list is prepared, they anticipate they will wish to rely on at trial be extended to 14 October 2011. 9. If the cross-claimants fail to comply with any of orders 6, 7, and 8 above then the proceeding against the cross-respondents be dismissed. 2 Whilst the first cross-respondent argued that the cross-claimants were in breach of Orders 6 and 8, I accept that, as the cross-claimants submitted, the cross-claimants complied with Orders 6 and 7, although they failed to comply with Order 8. The cross-claimants failed to comply with Order 8 because they did not file a list of documents upon which they anticipated they would rely at trial on or before 14 October 2011. I rejected the first cross-respondent's submission that, by reason of the cross-claimants' filing of the further supplementary affidavits of Norman Phillip Carey sworn on 13 October 2011 and Graeme John Rundle sworn 13 October 2011, they should be taken to have failed to comply with Order 6. The cross-claimants sought to file the supplementary affidavits principally to correct errors and omissions in the principal affidavits filed by 30 September 2011, in conformity with Order 6. 3 By an interlocutory application dated 17 October 2011, the cross-claimants sought orders that: 1. The cross-claimants have leave to file the supplementary affidavit of Norman Phillip Carey sworn 13 October 2011 and the affidavit of Graeme John Rundle sworn 13 October 2011. 2. Paragraph 8 of the orders made 8 September 2011 be varied so as to extend, to a date to be fixed, the time for the cross-claimants to file a list of the documents upon which, at the time the list is prepared, they anticipate they will wish to rely on at trial. 4 The cross-respondents sought either a declaration that the proceedings of the cross-claimants against the cross-respondents stand dismissed, or orders extending the time in which the cross-respondents were to take steps preparatory to trial. 5 The cross-claimants relied on an affidavit of their solicitor, Arthur Metaxas, sworn on 17 October 2011. The first cross-respondent relied on two affidavits of its solicitor, Patrick Xavier Tuohey, both sworn on 17 October 2011. 6 As regards a springing or guillotine order, authorities such as Smith v Barron (2004) 139 FCR 566 (especially at 577) and Aust-Pol Engineering Pty Ltd v Australian Maritime Safety Authority [1998] FCA 1198 establish that the Court has a discretion to extend time for compliance with an order to which a springing or guillotine order relates. The discretion will be exercised in favour of a non-complying party if the Court is persuaded that it is in the interests of justice to do so. This requires consideration of all the circumstances of the case, including its history, the seriousness of the consequences for the non-complying party if an extension is not given, the nature of the prejudice to other parties if an extension is granted, and whether the non-complying party has demonstrated an ability to present its case within an appropriate and reasonable time. The cross-claimants referred to a number of other authorities, which, in substance, were to similar effect: see Composite Buyers Ltd v JC Taylor Constructions Pty Ltd [1983] 2 VR 311, Ridge Lane Pty Ltd v Gadzhis [2007] VSC 212, Jorgensen v Slater & Gordon Pty Ltd [2008] VSCA 110 and Pereira v Beanlands [1996] 3 All ER 528. 7 It would be appropriate, in the interests of justice, to extend the time within which the cross-claimants are to file a list of documents upon which, at the time the list is prepared, they anticipate they will wish to rely on at trial, having regard to the following considerations: 1. the seriousness of the consequences for the cross-claimants if the time is not extended; 2. the fact that, on Mr Metaxas' unchallenged evidence, the failure to comply with the time stipulated in Order 8 was inadvertent; 3. the fact that the cross-claimants complied with Orders 6 and 7 concerning the filing of lay and expert affidavits (and reports); and 4. the fact that the cross-claimants have demonstrated that they are able to present their case at trial within an appropriate and reasonable time. Further, I have also borne in mind that any prejudice to the cross-respondents can be overcome by an appropriate costs order and, in the present case, a reorganisation of the trial period, to the extent needed. 8 I would therefore order that the time for the cross-claimants to file a list of documents upon which, at the time the list is prepared, they anticipate they wish to rely at trial be extended until 4 o'clock on 28 October 2011. It is also appropriate to grant the cross-claimants leave to file the supplementary affidavit of Norman Phillip Carey sworn 13 October 2011 and the supplementary affidavit of Graeme John Rundle sworn on 13 October 2011. As stated above, these affidavits are, for the most part, designed to deal with errors and omissions in the deponents' principal affidavits. I would make the other orders as indicated in the course of today's hearing. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kenny. Associate: Dated: 25 October 2011 SCHEDULE OF PARTIES ANN STREET MEZZANINE PTY LTD ( IN LIQUIDATION) (ACN 102 854 866) Plaintiff CEDRIC RICHARD PALMER BECK First Defendant JOHN NORMAN DIXON Second Defendant GRAEME JOHN RUNDLE Third Defendant NORMAN PHILLIP CAREY Fourth Defendant LYNETTE ROCHELLE SCHIFTAN Fifth Defendant NEEDLERS END NOMINEES PTY LTD (ACN 008 828 324) Sixth Defendant KEBBEL CAPITAL PTY LTD (ACN 106 196 481) Seventh Defendant PALENTIA PTY LTD (ACN 099 289 326) Eighth Defendant NORMAN PHILLIP CAREY First Cross-Claimant QUARTZ NOMINEES PTY LTD (ACN 008 859 103) Second Cross-claimant HECA NOMINEES PTY LTD (ACN 053 581 874) Third Cross-claimant ACEBID PTY LTD (ACN 074 566 046) Fourth Cross-claimant ANDRIANNI PTY LTD (ACN 005 458 720) ATF THE ANDRIANNI TRUST Fifth Cross-claimant ANN STREET BRISBANE PTY LTD (ACN 101 943 711) ATF THE ANN STREET BRISBANE TRUST Sixth Cross-claimant BENNALONG HOLDINGS PTY LTD (ACN 008 741 008) Seventh Cross-claimant DOSIUS PTY LTD (ACN 009 449 450) Eighth Cross-claimant EARLMIST PTY LTD (RECEIVER & MANAGER APPOINTED) (CONTROLLER APPOINTED) (ACN 069 056 926) ATF THE EARLMIST UNIT TRUST Ninth Cross-claimant ETNAS PTY LTD (ACN 056 599 350) ATF THE ENTAS TRUST Tenth Cross-claimant HEALTHCARE PROPERTIES PTY LTD (ACN 074 501 955) ATF THE HEALTHCARE PROPERTIES TRUST Eleventh Cross-claimant HUNTINGDALE VILLAGE PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 085 048 531) ATF THE HUNTINGDALE VILLAGE UNIT TRUST Twelfth Cross-claimant JEVWOOD PTY LTD (ACN 074 525 321) Thirteenth Cross-claimant K.I.S. REALTY PTY LTD (ACN 100 871 314) Fourteenth Cross-claimant KEEP IT SIMPLE INVESTMENTS (GLOBAL) PTY LTD (ACN 100 871 270) Fifteenth Cross-claimant NORTH SYDNEY DEVELOPMENT PTY LTD (CONTROLLER APPOINTED) (ACN 107 037 838) ATF THE NORTH SYDNEY DEVELOPMENT TRUST Sixteenth Cross-claimant PAQUERO PTY LTD (ACN 003 530 556) Seventeenth Cross-claimant PARAGON APARTMENTS LTD (RECEIVER & MANAGER APPOINTED) (ACN 087 200 413) Eighteenth Cross-claimant RENAISSANCE MEZZANINE PTY LTD (ACN 110 978 491) Nineteenth Cross-claimant ROMPRIDE PTY LTD (ACN 074 524 824) ATF THE ERLEY UNIT TRUST Twentieth Cross-claimant SCOTS CHURCH DEVELOPMENT LTD (RECEIVER & MANAGER APPOINTED) (ACN 091 686 323) Twenty-first Cross-claimant SILKCHIME PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 066 849 429) ATF THE SILKCHIME UNIT TRUST Twenty-second Cross-claimant VANNIN PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 067 610 271) ATF THE HAY FAMILY TRUST Twenty-third Cross-claimant WARWICK ENTERTAINMENT CENTRE PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 054 246 918) ATF THE WARWICK ENTERTAINMENT CENTRE UNIT TRUST Twenty-forth Cross-claimant WESTPOINT FINANCIAL SERVICES PTY LTD (ACN 074 148 324) Twenty-fifth Cross-claimant WESTPOINT MANAGEMENT (CENTREWAYS) PTY LTD (ACN 082 349 068) ATF THE CENTREWAYS REFURBISHMENT SYNDICATION TRUST Twenty-sixth Cross-claimant FREEHILLS First Cross-respondent AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Second Cross-respondent COMMONWEALTH OF AUSTRALIA Third Cross-respondent