Alexander v Moss [1999] NSWCA 64

New South Wales Court of Appeal CITATION : Alexander v Moss [1999] NSWCA 64 FILE NUMBER(S) : CA 40357/98 HEARING DATE(S) : 22/02/99 JUDGMENT DATE : 22 February 1999

PARTIES : Geoffrey Tyler Alexander v Darren Moss JUDGMENT OF : Beazley JA at 28; Fitzgerald JA at 1

LOWER COURT JURISDICTION : District Court LOWER COURT FILE NUMBER(S) : 5703/96 LOWER COURT JUDICIAL OFFICER : McLachlan ADCJ

COUNSEL : J E Armfield (Claimant) E Olsson (Opponent) SOLICITORS : Greg Walsh & Co (Claimant) Cara Marasco & Company (Opponent) CATCHWORDS : Leave application; strike out order inappropriately made. DECISION : Leave to appeal granted

THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA40357/98 DC 5703/96 BEAZLEY JA FITZGERALD JA

Monday 22 February 1999

Geoffrey Tyler ALEXANDER v Darren MOSS

JUDGMENT

1 FITZGERALD JA: This is an application for leave to appeal from a District Court judgment of 5 May 1998 which struck out the claimant's action. The claimant had sued the opponent in the District Court for approximately $20,000. The claimant alleges that an agreement was made between the parties in February 1994 and that the opponent refused to make a payment required by that agreement. 2 The original statement of claim was filed on 1 October 1996 and served on the opponent in Western Australia on 22 November 1996. On 12 December that year, the opponent requested further and better particulars of the original statement of claim and, on 28 January 1997, he filed his defence. Despite an order by a registrar dated 23 July 1997 that particulars be provided within 14 days, the claimant did not do so until 2 September 1997. 3 On 24 September, there was a Status Conference before another Registrar at which the claimant failed to appear. The matter was referred to a District Court Judge for the claimant to "show cause as to why the matter should not be struck out". 4 On 22 October 1997, the following directions were given by consent by a District Court Judge: "1. [Claimant] to file and serve an Amended Statement of Claim by 11 November 1997. 2. [Opponent] to file a Defence to the Amended Statement of Claim by 2 December 1997. 3. Parties to file a verified list of documents on or before 16 December 1997. 4. Either party wishing to administer interrogatories, drafts thereof be served on the opposing party by 20 February 1998. 5. Costs of the Status Conference of 24 September 1997, notices of motion filed 17 October 1997 and 21 October 1997 be costs in the action. 6. Proceedings adjourned until 10 March 1998." 5 The claimant's amended statement of claim was filed on 10 November 1997, that is within time according to the directions, and on 25 November 1997, the claimant filed and served a verified list of documents, again within time. On 22 December 1997, the opponent requested further and better particulars, which were not furnished until 5 March 1998. 6 The opponent has not filed a defence to the amended statement of claim contrary to directions and, again contrary to directions has not filed and served a verified list of documents. 7 Notwithstanding that, on 10 March 1998 an acting District Court Judge directed that the opponent file an affidavit in support of an application to strike out the action by 27 March 1998 and that the claimant file an affidavit in reply by 1 April 1998 and adjourned the matter to 3 April 1998. The claimant did not file his affidavit by 1 April 1998 or until 3 April 1998. 8 Between 18 March and 3 April 1998 there had been some misunderstandings or confusion between the claimant and his solicitor concerning their respective attempts to contact each other. On 27 March 1998, the claimant's solicitor filed a Notice of Ceasing to Act in the District Court, but that notice was withdrawn on 3 April 1998. 9 It was on that day that the application to strike out was heard and judgment was reserved to 28 April 1998. 10 The claimant's solicitor attended the District Court on that day (28 April 1998) but the matter was not listed. However, on 5 May 1998, the acting District Court Judge delivered a judgment striking out the action. 11 The critical passage in the brief reasons for judgment comes at the end of the recitation of part of the history of the litigation. His Honour then continued: "… inquiry shows that interrogatories are still outstanding as is discovery and the action is still not ready for allocation of a hearing date. In these circumstances I have no alternative other than to strike the action out on the court's motion in terms of Pt 18 and the [claimant] will pay the [opponent's] costs of the action." 12 Courts are understandably intent on ensuring that litigation is conducted as expeditiously, efficiently, and cheaply as possible. However, while the history of the current proceeding does not indicate that the claimant's claim has been pursued with exemplary vigour, there are limits to the circumstances in which it is appropriate to strike an action out for procedural defects. In the present matter, the claimant was not even in default at the time when the order striking out his action was made. On the contrary, the opponent was in default, having neither filed a Defence to the Amended Statement of Claim nor filed and served a verified list of documents as required by the directions made on 22 October 1997. 13 His Honour was therefore, incorrect in stating that the claimant was in default in not having filed his list of documents. His Honour was also incorrect with respect to interrogatories in that neither party was in default since the directions given on 22 October 1997 did not require but merely permitted draft interrogatories to be served. 14 Before this Court, it is common ground that the Acting Judge acted pursuant to Pt 18, r 3 of the District Court Rules which provides: "Where a plaintiff makes default in complying with an order or direction in the conduct of proceedings, or does not prosecute the proceedings with due dispatch, the court may, on application by any party or of its own motion, dismiss the proceedings and make such other order as the court thinks fit." 15 While I would not wish to place a gloss upon the Court's power to dismiss a proceeding which is not prosecuted with "due dispatch" by the plaintiff, it is not easy to conceive of circumstances in which it would be appropriate to do so at a time when the plaintiff had remedied any default in complying with any order or direction and was not otherwise in default and the defendant was in default. 16 In the course of argument before this Court, reference was also made to the District Court Practice Note 33. Which provides: "This Practice Note is issued as a direction under s 68A of the District Court Act 1973 and is to be followed despite several inconsistencies with the District Rules." 17 On 3 April 1998, the opponent's solicitor informed the Acting District Court Judge in the absence of the claimant's solicitor, who had not then arrived, that the claimant was in default in terms of Practice Note 33 and that caused his Honour, at the start of his reasons for judgment to say: "This action was commenced on 1 October 1996 in terms of Practice Note 33. It is governed by the timetable set at the time of the filing of the statement of claim and by the Court's resolve that 90% of all civil cases will have been disposed of within 12 months. If the parties had been ready the action could have been disposed of some six months ago." 18 That statement must of course be seen with his Honour's later observation and the passage earlier quoted that "… the action is still not ready for allocation of a hearing date". It must also be understood to be based on the errors earlier referred to. 19 Practice Note 33 may well present other difficulties. However, it is sufficient for present purposes to say that the relevant timetable in this proceeding after 22 October 1997 was that set by the District Court Judge on that date. 20 The opponent opposes leave on a variety of grounds including the totality of the claimant's conduct. Little significance is, in my opinion to be attributed to that conduct in the particular circumstances of this case, especially having regard to the absence of default by the claimant and the default by the opponent at the time that the action was struck out. 21 The opponent also submitted that the claimant could obtain an order under Pt 18 r 4 of the District Court Rules setting aside the order striking out the action. Another reason advanced was that the claimant could have filed a notice of motion to reinstate the proceedings, and reference was made to New South Wales Insurance Ministerial Corporation v Anderson, an unreported decision of this Court delivered on 14 June 1994. 22 Still another possibility raised by the opponent is that "… the Claimant can file fresh proceedings in the correct jurisdiction, namely the Local Court". According to the opponent, because the amount claimed was "within the monetary jurisdictional limit of the Local Court as at 1 October 1996 … the Claimant should have commenced the proceedings in the Local Court in order to limit his and the opponent's exposure to legal costs". 23 Accordingly, the Opponent contends that it is "prejudicial and unfair" that he "should continue to incur such legal costs to defend the Statement of Claim when there was non compliance with Practice Note 33 by the Claimant…" 24 The opponent implicitly recognises that the claimant is entitled to bring the action although contending that it should be in the Local Court and not the District Court. Correctly or otherwise, the opponent assumes that there is no time bar to a Local Court action. The matter is therefore before this Court on the basis of a debate which has nothing to do with the substance or merits of the case but is concerned with procedural points. 25 Regrettably, an over enthusiastic Acting District Court Judge, excessively concerned with that court's commendable rate for disposal of proceedings, has provided the parties and their solicitors with the opportunity to generate the present debate, wasting the time of this Court at some cost to themselves and to the public which must provide this Court's resources. The essential point to be made is that the order made striking out the action should not have been made. 26 Irrespective of the court where the dispute should be litigated or what directions should now be given for the further conduct of the appropriate proceeding, the order which should not have been made striking out the action should be set aside. 27 For that reason, leave to appeal should be granted, and orders should be made allowing the appeal and setting aside the orders made below. 28 BEAZLEY JA: I agree.