New South Wales Supreme Court CITATION : KSM Transport Services v Gregorys Transport [2003] NSWSC 901 HEARING DATE(S) : 30 September 2003 JUDGMENT DATE : 3 October 2003 JURISDICTION: Common Law Division JUDGMENT OF : Master Malpass DECISION : The Summons is dismissed. The plaintiff is to pay the costs of the Summons. CATCHWORDS : Appeal from Small Claims Division - application for leave to be represented by a person who was not counsel or a solicitor - McKenzie friend - application for adjournment - the jurisdiction of the Small Claims Division - denial of natural justice. LEGISLATION CITED : N/A El-Najjaar v Offshore Marketing Services & Anor [2003] NSWSC 209. CASES CITED : C v M [1996] NZFLR 106. McKenzie v McKenzie (1970) 3 All ER 1034. KSM Transport Services Pty Ltd (Plaintiff) PARTIES : v Gregorys Transport Pty Ltd (Defendant) FILE NUMBER(S) : SC 13120 of 2002 COUNSEL : Mr H W M Stitt (Plaintiff) N/A SOLICITORS : W G McNally (Plaintiff) Deacons (Defendant) LOWER COURT Local Court JURISDICTION : LOWER COURT 757 of 2002 Blacktown Local Court FILE NUMBER(S) : LOWER COURT Mr Brown LCM JUDICIAL OFFICER : IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION Master Malpass Friday 3 October 2003 13120 of 2002 KSM Transport Services Pty Ltd v Gregorys Transport Pty Ltd JUDGMENT 1 MASTER: The parties entered into a written contract. There was a subsequent oral variation. The plaintiff provided carrying services for the defendant. A dispute arose between the parties as to whether or not moneys were owed by the defendant to the plaintiff for carrying services. 2 The plaintiff claimed a sum in the order of $9,000. The defendant said that the dispute related to discrepancy arising from the plaintiff's invoices and the lack of documentation to support the claim. 3 Proceedings were commenced in the Local Court. They were listed in the Small Claims Division. It seems that they came before the court on 15 August 2002 (perhaps for pre-trial review). Directions were given and the matter was fixed for hearing for 18 October 2002. A hearing took place before Mr Brown LCM on that day. Neither party had legal representation. He delivered judgment following his hearing of the matter. 4 By Summons filed on 15 November 2002, the plaintiff brings an appeal from that decision. The ground of appeal is denial of natural justice. There is a restricted avenue of appeal (see El-Najjaar v Offshore Marketing Services & Anor [2003] NSWSC 209). 5 It is said that the learned Magistrate had before him a Statement of Claim and a Statement of Defence. It appears that he also had before him a statement from Mr Kontaxis (who represented the plaintiff in the Local Court) and a statement from Mr Gaebler (who represented the defendant before the Local Court). It appears also that the plaintiff relied on piles of invoices in support of its claim. It does not appear that there was any other material placed before the learned Magistrate. 6 The appeal was heard on 30 September 2003. In hearing the appeal, the court had before it an affidavit sworn by Mr Jaloussis (which annexed the transcript of the proceedings before the Local Court) and an affidavit from Mr Hotson (a Licensed Commercial Agent and Private Investigator). An attempt was made during the hearing in the Local Court for Mr Hotson to assist Mr Kontaxis in the conduct of the plaintiff's case. This Court did not have before it the pleadings, the statements, the invoices or the written contract. 7 There is some uncertainty as to what happened during the course of the hearing. This arises from what appears (or does not appear) in the transcript and the absence of the material referred to in the previous paragraph. The absence of material made the task of this Court more difficult. 8 The transcript reveals that an application was made by Mr Kontaxis in relation to leave for assistance from Mr Hotson. Although, it was expressed in terms of an application for leave for Mr Hotson to assist as a McKenzie friend, it appears that there may have been confusion as to the role played by a McKenzie friend. 9 In substance, it appears that Mr Kontaxis was seeking to have leave to enable Mr Hotson to inter alia appear and present the plaintiff's case. It was later said by him to the learned Magistrate that he found it hard to speak, that he forgot things and that he would like to have some representation if possible. 10 The application appears to have been dealt with as an application for leave to appear. Mr Hotson did seek to address the learned Magistrate. He was refused leave to appear. It does not seem that he was otherwise debarred from assisting the plaintiff. Indeed, he may have continued to render assistance (inter alia in relation to a subsequent application for adjournment). 11 It appears that the matter then remained in the list whilst the learned Magistrate called through other matters. 12 When the learned Magistrate returned to the matter, he informed the parties that he had read through the statements. Mr Kontaxis then made an application for adjournment on the grounds that the court had rejected the application in relation to Mr Hotson. This application was also rejected. In rejecting the application, it appears that the learned Magistrate had regard to a number of matters (including the matters that it seemed to be a fairly straight forward contractual dispute and that the plaintiff had had the opportunity to get legal assistance if it had wished to do so). 13 The parties were then given an opportunity to make submissions. Mr Kontaxis was extremely brief. He said that the amount was outstanding and that he would like to get paid for it. Mr Gaebler clearly raised the issue of the lack of documentation to support the plaintiff's claim. He submitted inter alia that the piles of invoices were not substantiated as required by the contract (this involved inter alia manifest sheets, run sheets and required signatures). 14 After hearing from the parties, the learned Magistrate then delivered his judgment. He preferred the statement made by Mr Gaebler (because it was a great deal more detailed). He then posed what seems to me to be the proper question to be addressed (the issue depends on the plaintiff establishing on the balance of probabilities that the defendant is in breach of the contract by failing to pay amounts properly due under the contract). He then expressed a preference for the documentation provided by the defendant. He regarded it as being a great deal more persuasive. He referred to the double signature system which had been raised in the Statement of Defence. He found that the plaintiff had failed to establish on the balance of probability that it had not been paid. He then gave judgment for the defendant. 15 It is alleged that the plaintiff was denied natural justice or procedural fairness in a number of respects. The case for the plaintiff has been fully expressed in the written outline of submissions which were supplemented by oral argument. It is not proposed to repeat in this judgment all of the arguments that were advanced during submissions. It suffices to expressly refer to some of them. It is said inter alia that natural justice or procedural fairness was not extended to the plaintiff in refusing each of the applications, in not giving the plaintiff an opportunity to fairly present its case, in not having regard to all of the evidence and in not giving proper reasons. 16 It appears that Mr Hotson had played an earlier role in the proceedings, (he had drafted the Statement of Claim and may have prepared the statement for Mr Kontaxis). 17 It is important to bear in mind that these proceedings were in the Small Claims Division of the Local Court and were to be determined in accordance with the relevant procedure. The purport of that procedure was to see that proceedings were conducted with as little formality and technicality as possible. The rules of evidence did not apply and the court had the power to determine, as it saw fit, the procedure to be followed in hearing the particular proceedings. 18 The amount in dispute may not justify the expense of legal representation. As a consequence, many litigants are unrepresented. The aim of the exercise is to provide expeditious resolution of small claims with as little formality and technicality as possible. 19 In this case, the substance of the initial application was to seek to have Mr Hotson appear on behalf of the plaintiff. A party has the right to present its own case. In presenting that case, it may seek such assistance as is thought appropriate. It is entitled to have legal representation in the Small Claims Division. It is not entitled as of course to have a person other than counsel or a solicitor to appear on its behalf. The court has a discretion to allow that to take place. The discretion is to be exercised having regard to the interests of justice. 20 The role of a McKenzie friend may be said to be to advise and assist. The expression arose from the case of McKenzie v McKenzie (1970) 3 All ER 1034. It was a case in which a judge had erroneously debarred a friend from assisting an unrepresented litigant. It referred to earlier authority to the effect that no one can demand to take part in a proceeding as an advocate contrary to the regulations of the court and any discretion had by a judicial officer. It seems that leave may not be required to act as a McKenzie friend. 21 Despite his earlier involvement in the matter, no attempt was made to seek leave for Mr Hotson to appear on behalf of the plaintiff until after the commencement of the hearing. Such an application could have been made at an earlier stage (inter alia when the matter came before the court on 15 August 2002). If the application had then been made and refused, it would have remained open to the plaintiff to seek legal representation prior to the hearing. 22 It appears that no material was put before the court to support any asserted incapacity on the part of Mr Kontaxis to present the case. The learned Magistrate was left to act on his observations of Mr Kontaxis and the transcript does not lend support to the assertions of Mr Kontaxis. 23 It may be that the application for leave to appear was dealt with abruptly and that the reasoning process of the learned Magistrate could have been more carefully expressed. He seems to have had in mind the consideration that an unqualified person may do more harm than good. A consideration that has been regarded as now being more cogent (C v M [1996] NZFLR 106). He was dealing with one of many small claims (which he saw as lacking in complexity) in what may have been a busy list of matters requiring expeditious and informal resolution. 24 In my view, it was reasonably open to the learned Magistrate in the circumstances of this particular case, to exercise his discretion by refusing each of the applications. He said that he had read the statements. I see no reason not to accept that observation. It appears that there was no other evidence to support the invoices. Indeed, it appears that there may not have been any other evidence that could have been led to advance the plaintiff's case. Both parties were given a reasonable opportunity to have their say in support of their respective cases. The judgment of the learned Magistrate addressed the right questions and expressed his reasoning process for determining the claim in the defendant's favour. Criticism has been made concerning the expression of reasoning process. I do not consider that this Court should be too demanding when considering the expression of reasoning process by a lower court handling a heavy workload. I regard the expression of reasoning process in this case as being sufficient. 25 The plaintiff bears the onus of satisfying the court that the decision of the learned Magistrate should be disturbed. In my view, that onus has not been discharged. I am not satisfied that there has been any denial of natural justice or procedural fairness to the plaintiff. Even if a different view were to be taken on that matter, I would not have been satisfied that the decision should be disturbed. 26 The Summons is dismissed. The plaintiff is to pay the costs of the Summons. ********** Last Modified: 10/09/2003 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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