Industrial Court of New South Wales CITATION: Lieu & Anor v Deng & Anor (No 2) [2006] NSWIRComm 260 FIRST APPLICANT Paul Lieu SECOND APPLICANT Landmark Enterprises Pty Limited PARTIES: FIRST RESPONDENT Margaret Jiasha Deng SECOND RESPONDENT Dengs Investments Pty Limited FILE NUMBER(S): IRC 2821 of 2001 CORAM: Staff J CATCHWORDS: Unfair contract - Notice of motion - Practice and procedure - Application for adjournment of proceedings by applicant - Interests of justice considered - Practice Direction 14 - Prejudice from delay not always met by costs order - Court's obligation to conduct matters in effective, efficient and prompt manner - application refused - Costs LEGISLATION CITED: Industrial Relations Act 1996 Apex Pallet Hire Pty Ltd v Brambles Holdings Ltd (VSC, McGarvie, Marks, Ormiston JJ, 8 April 1988, unreported, BC 8800750) CASES CITED: Lieu & Anor v Deng & Anor [2006] NSWIRComm 27 State of Queensland and Anor v JL Holdings Pty Limited (1997) 189 CLR 146 HEARING DATES: 02/08/2006 EXTEMPORE JUDGMENT DATE: 08/02/2006 FIRST APPLICANT Mr A Gotting of counsel Solicitor: Ms F Glynn Somerville & Co FIRST RESPONDENT LEGAL REPRESENTATIVES: Mr A J Grant of counsel Solicitor: Mr R J Kitching Christopher Lee & Associates SECOND RESPONDENT Mr W Andrews of counsel Solicitor: Mr P J Brand Bartier Perry JUDGMENT: - 1 - INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: Staff J 2 August 2006 Matter No IRC 2821 of 2001 PAUL LIEU & ANOR v MARGARET DENG & ANOR (No 2) Application pursuant to s 106 of the Industrial Relations Act 1996 EX TEMPORE JUDGMENT [2006] NSWIRComm 260 1 On 31 January 2006 in Lieu & Anor v Deng & Anor [2006] NSWIRComm 27, I determined a notice of motion filed by Paul Lieu and Landmark Enterprises Pty Ltd ("the applicants") in this matter. I made the following orders: 1. The hearing dates of 6, 7, 8 and 9 February 2006 for this proceeding be vacated. 2. The Respondents, within 7 days of the date of these orders, shall discover to the Applicants all documents set out in Schedule "A" to the Notice of Motion filed 27 January 2006. 3. In the event that the Respondents do not comply with the previous order, the First Respondent shall, within 14 days of the date of this order, file and serve an Affidavit which identifies the documents set out in Schedule "A" no longer in the First and/or Second Respondents' possession or control. 4. The Applicants be permitted to file and serve further evidence in these proceedings after reviewing the documents discovered by the Respondents pursuant to order 2. 5. The Applicants file and serve any further evidence upon which they intend to rely by 4.00pm on 24 March 2006. 6. The Respondents file and serve any further evidence upon which they intend to rely by 4.00pm on 21 April 2006. 7. Fix the proceedings for hearing before Staff J at 10.00am on Monday 28 August 2006, with an estimate of 4 days. 8. Liberty to apply. 2 It should be observed at the outset that the applicants failed to exercise any liberty to apply and failed to comply with the Court's directions. 3 Margaret Deng ("the first respondent") filed a further supplementary list of documents on 3 February 2006. A copy of the list was served on the applicant's solicitors on 8 February 2006. It had also been provided in unsworn form on 31 January 2006. 4 On 15 February 2006, the first respondent swore an affidavit verifying she had produced the additional documents in respect of what was described as schedule A to the earlier notice of motion. 5 On 5 June, the first respondent filed a further affidavit in reply in response to the applicants' affidavits of March and July 2005. 6 On 6 July 2006, the applicants filed a further notice of motion seeking the following orders: 1. The hearing dates of 28, 29, 30 and 31 August 2006 for this proceeding be vacated. 2. The Applicants be permitted to file and serve further evidence in these proceedings within such time as ordered by the Court. 3. That the costs of this motion be costs in the cause. 4. Such further or other order as this Honourable Court deems fit. 7 At the commencement of the hearing today, Mr A Gotting of counsel who appeared for the first applicant (subsequently referred to as "the applicant") informed the Court that the second applicant had been deregistered on 23 July 2006. The Evidence 8 Essentially, a further adjournment of the proceedings is sought by the applicant because of circumstances he contends were beyond his control since 31 January 2006. 9 The applicant's evidence is that he has had insufficient financial resources to take such steps as are necessary to prepare this matter for hearing. Such financial issues have now been resolved by the loan of $10,000 to the applicant which occurred in June and an anticipated further loan of $30,000 this Friday, 4 August 2006. 10 It is contended by counsel for the applicant, that this will enable the applicant to obtain an expert accounting report. Mr Gotting conceded that the applicant would have sufficient time to consider the further affidavit filed by the first respondent on 5 June and inspect the documents prior to the dates fixed for hearing of this matter. 11 Counsel submitted, however, that the expert's report will take four weeks to prepare. The applicants initially engaged the expert in 2002 and have not been able to obtain a report because of their financial position. 12 Mr A J Grant of counsel, who appeared for the first respondent, opposed any further adjournment of the proceedings, relying on an affidavit of Miss Christine Louise Perry sworn 1 August 2006. 13 Miss Perry stated that at no time since 31 January 2006 had the solicitors for the applicants sought to inspect the documents in the supplementary list filed by the first respondent. Miss Perry is an accredited specialist in commercial litigation. In her opinion, it would take no more than three hours to view the additional documents produced and analyse those documents. 14 Miss Perry also deposed that the first respondent is suffering from stress, hypertension, high blood pressure, depression and anxiety to which she has daily medication. The first respondent is 42 years of age. She believes the high blood pressure and stress is caused by the proceedings which relate to the matters that occurred some ten years ago. It is contended that these conditions are preventing her from falling pregnant. The first respondent suffered a miscarriage in 2002. Her first child was born in 2003. She wishes to have a second child and she proposed to take time off work following the hearing in August in an attempt to fall pregnant. 15 Mr W Andrews of counsel, who appeared for the second respondent, tendered an affidavit of Mr Philip Brand, solicitor. Submissions 16 Mr Gotting submitted that in determining this application, I was required to take into account the overall interests of justice between the parties. In this regard, counsel referred to the decision of the High Court in the State of Queensland and Anor v JL Holdings Pty Limited (1997) 189 CLR 146 at 154. 17 Mr Gotting submitted that the applicant had explained the defaults by him in respect of the Court's directions and has given an apology to the Court. Counsel submitted case management is important but not determinative of applications such as this and that the breach of the directions should not preclude the applicant presenting his case. 18 Counsel further submitted that the respondent swore an affidavit in June 2006 and noted she had no difficulty in recalling the events surrounding this matter. 19 In respect of Miss Perry's affidavit, Mr Gotting submitted that the evidence given in respect of the first respondent's health was hearsay, and not supported by medical evidence. It was further submitted that any prejudice to the respondents was outweighed by the applicant being allowed to proceed to obtain expert evidence. 20 In addition, Mr Gotting submitted the first applicant would meet the costs of the respondents in respect of this notice of motion and undertook to comply with any further directions made by the Court. 21 Mr Grant submitted this was the second application for an adjournment in circumstances where the applicants had consented to hearing dates being fixed in May 2005. The first respondent had complied with the orders made by the Court on 31 January 2006 and at no time had the solicitors for the first and second applicants, nor the first applicant himself, attended the respondents' solicitors office to inspect the documents that had been produced. 22 On previous occasions, Mr Grant observed the applicant had inspected documents himself. Counsel also observed that the applicant had been in numerous default of directions made by this Court and that the financial difficulties of the applicants had been a feature of these proceedings. 23 Mr Grant further observed that in relation to retaining an expert accountant, there was no dispute between the parties in respect of the respondents' accounts. Mr Grant contended the claim that is made is that dividends were not paid to the applicants. It was submitted that the applicant should have provided evidence to the Court as to what matters the expert's report would cover. 24 Finally, Mr Grant submitted that the respondent would not be compensated by way of costs orders, particularly in circumstances where the recovery of costs would be potentially negligible in light of the applicant's financial position. 25 Mr Andrews supported the submissions of the first respondent. Consideration 26 In determining this application, I accept I am required to exercise my discretion by balancing the overall interests of justice as between the parties. 27 The summons in this matter was filed in April 2001. As I observed in Lieu & Anor v Deng & Anor, this matter has had a tortured history which I do not repeat here. However, it should be observed that the applicants have been in default of the directions made by this Court on a number of occasions. 28 The applicants have, as I read the grounds and reasons of the notice of motion, had some funds available that would enable them to pursue this matter since at least June of this year. It seems to me, particularly in light of the evidence given by Miss Perry, that there has been sufficient time since at least 6 July 2006, to inspect documents and respond to the further affidavit of the first respondent. This much was conceded by Mr Gotting. 29 There is a further three weeks before this matter is listed for hearing. In my view this is sufficient time to enable the applicant to obtain an expert's report. In addition, I am mindful that this litigation is causing ongoing health problems to the first respondent. Although Mr Gotting submitted that such evidence was hearsay, I'm minded to give some weight to this evidence. 30 It is always unfortunate if proceedings are disposed of at trial without the case of one side or another being properly prepared and presented. However, in my view, this is not a case on the evidence of accident or surprise preventing a party appearing and presenting their case at trial. 31 This is a case where the applicant has not been in a position to deal with the additional documents discovered and further affidavits filed by the respondent until June 2006. The evidence is that the applicant has experienced financial difficulties between January 2006 to about June 2006. He says that he will obtain a loan of $30,000 on 4 August 2006. 32 In my view, as I have already observed, this should provide sufficient time to the applicant and his legal representatives to obtain an expert's accounting report. As McGarvie J said in Apex Pallet Hire Pty Ltd v Brambles Holdings Ltd (VSC, McGarvie, Marks, Ormiston JJ, 8 April 1988, unreported, BC 8800750). "...The right of a party to litigation is a right to have a reasonable opportunity to present its case or its defence. It is not accurate to regard the law as being that if one party, through neglect, is in a position where it is not able properly to present its case, it is automatically entitled to an adjournment..." 33 These comments seem to me to be apposite in respect of this matter. Taking into account the financial difficulties experienced by the applicants, it is difficult to find that they have not had a reasonable opportunity to prepare and present their case since at least June of this year. 34 In addition, I observe that Practice Direction 14 was introduced to secure the speedy and efficient disposal of cases brought pursuant to section 106 of the Industrial Relations Act 1996 ("the Act"). Directions must be substantially and properly adhered to, and special fixtures mean just that. 35 In passing, I note that the Practice Direction 17 which is directed to applications brought before the Commission pursuant to section 84 of Act (unfair dismissal applications) provides that the date set for arbitration is definite. Adjournments will only be granted on clear and compelling grounds. 36 Some guidance in my view may therefore be obtained from the approach adopted by the Commission in respect of applications for adjournments. 37 In cases such this where substantial claims are at issue between the parties, in my view, bearing in mind the circumstances of this matter, there is a prejudice to the respondents from the delays which cannot always be met or fully met by an order for costs. This may well be the case here in light of the applicant's financial position. 38 Furthermore, where this Court is under pressure due to delays in hearing s 106 applications, an adjournment involves prejudice to persons other than the litigants in question. The Court has an obligation to conduct business in a manner which is efficient, effective and prompt and is consistent with the highest standards of justice. 39 Finally, I should observe that applications such as this are inevitably finely balanced. Taking into account all of the matters that I have referred to in these reasons, in my opinion, the application for an adjournment should be refused. I so order. 40 I should note that during the course of the submissions this morning, I was advised that there had been some six sets of proceedings commenced by the applicants against the respondents and all of those sets of proceedings have now been resolved except this one. 41 In those circumstances, I encourage the parties to explore whether this matter is capable of resolution. Needless to say a settlement will minimise the significant further costs that will be incurred by all parties if this matter proceeds to final hearing. 42 I make an order that the applicant pay the costs of the first and second respondents, as agreed, or as assessed in respect of this notice of motion. ---------------------------------- DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.