Supreme Court New South Wales Medium Neutral Citation: Dean Michael Russo and Anna Maria De Palma v Acebond Pty Limited [2012] NSWSC 300 Hearing dates: 28 March 2012 Decision date: 05 April 2012 Jurisdiction: Common Law Before: Bellew J Decision: (1) Time for filing the Summons extended to 22 November 2011. (2) Leave to appeal refused. (3) Summons dismissed. (4) Plaintiffs to pay the defendants costs. Catchwords: Appeal from Local Court - extension of time in which to bring application for leave to appeal - material date - application of slip rule - relevant considerations in extending time - leave to appeal against decision of Magistrate - question of mixed fact and law - findings of fact by Magistrate - submissions in support of application for leave to appeal not put to Magistrate - party bound by the conduct of the case at first instance Legislation Cited: Civil Procedure Act 2005 Local Courts Act 2007 Uncollected Goods Act 1995 Uniform Civil Procedure Rules 2005 Cases Cited: Chilcotin Pty Limited v Cenelage Pty Ltd [1999] NSWCA 11 Currabubula v State of New South Wales [2000] NSWSC 232 Elyard Corporation Pty Ltd v DDB Needham Sydney Pty Ltd (1995) 133 ALR 206 Metwally v University of Wollongong (1985) 60 ALR 68 Registrar of Titles v Spencer (1909) 9 CLR 64 Ziino & Anor v Wong (unreported, NSWSC 28 October 1980) Category: Procedural and other rulings Parties: Dean Michael Russo and Anna Maria De Palma (Plaintiffs) Acebond Pty Limited (Defendant) Representation: In Person (Plaintiffs) Mr A. Davis (Defendant) Dean Lawyers (Plaintiffs) Mercantile Legal (Defendant) File Number(s): 11/371988 Publication restriction: / Judgment Introduction 1By Summons filed on 21 November 2011 the plaintiffs Dean Michael Russo and Anna Maria De Palma seek: (1)an extension of time in which to seek leave to appeal against a decision of Magistrate Atkinson handed down in the Local Court; and (2)leave to appeal against the Magistrate's decision. 2It should be noted that in the Local Court proceedings from which the present applications arise, the Statement of Claim named "Dean Michael Russo trading as Dean Lawyers" as the sole defendant. However, in the same proceedings a Cross-Claim was brought by Mr Russo and Ms Anna Maria De Palma, who is Mr Russo's wife. One aspect of the appeal in respect of which leave is sought concerns the Magistrate's dismissal of that Cross Claim. It is in these circumstances that both Mr Russo and Ms De Palma are named as plaintiffs in the current proceedings. Background 3By a Statement of Claim filed in the Local Court on 12 November 2010 Acebond Pty Limited ("Acebond") brought proceedings against Mr Russo for damages for a breach of a Lease Agreement dated 1 May 2009 ("the agreement"). The agreement related to commercial premises at Suite 3, 38-46 Albany Street, St Leonards from which Mr Russo, for some period of time, conducted practice as a Solicitor. 4At the commencement of the hearing before the Magistrate (at AB 6 L 12) Mr Russo expressly conceded that there was "liability on (his) part". In particular, he did not dispute: (a)the fact of the agreement; (b)the fact that the agreement had been breached by his failure to pay rent; and (c)the fact that in these circumstances, Acebond was entitled to terminate the agreement and re-enter the premises. 5The principal issue before the Magistrate was therefore one of quantum. In that regard, Acebond's claim was brought under a number of specific heads of damage which included the following: (a)arrears of rent; (b)cleaning costs; (c)locksmith costs; (d)storage costs; (e)leasing fees; and (f)fees payable to a Mercantile Agent. 6The Plaintiffs filed a Cross Claim seeking (inter alia) damages arising out of Acebond taking possession, at the time of terminating the agreement, of a number of items said to belong to the Plaintiffs. In its defence to that Cross Claim, Acebond admitted taking possession of, and retaining, the items in question but maintained that it was entitled to do so pursuant to the terms of the agreement. The Magistrate's decision 7In reasons delivered on 30 August 2011 the Magistrate concluded (at paragraph [67], AB 174) that Acebond was entitled to damages in the sum of $13,863.34, together with interest. Those damages included a sum of $3,148.40 in respect of what were described as Mercantile Agents Fees (at paragraphs [59] - [62], AB 173 - 174). This is the only aspect of the Magistrate's conclusions as to the assessment of Acebond's damages in respect of which Mr Russo now seeks leave to appeal. 8The Magistrate also concluded (at [54], AB 172) that she was not satisfied that either Mr Russo or Ms De Palma had proved, on the balance of probabilities, the necessary matters in order to succeed on the Cross Claim. However she did not, at the time of giving her reasons, make any order dismissing the Cross Claim although it seems that her failure to do so was simply an oversight. The order dismissing the Cross Claim was made at a later time in circumstances to which I will return. At this stage, I simply note that the dismissal of the Cross Claim is the second aspect of the Magistrate's conclusions in respect of which leave to appeal is sought. 9Although the Magistrate gave reasons for her decision on 30 August 2011 she did not enter judgment on that day. At paragraph [67] (AB 174) of her reasons, under the heading "Orders", the Magistrate stated that she "proposed ordering" that judgment be entered for the defendants in a sum of $13,863.34. Having set out the various components of that sum, she gave the parties (at paragraph [68], AB 175) liberty to re-list the proceedings for any argument about costs. She then made (at paragraph [69], AB 175) some consequential directions in the event that the parties did not wish to make submissions in relation to costs, before stating the following (at paragraph [70] AB 175): If the parties do not apply within 14 days to have the proceedings re-listed for any argument about the costs of the proceedings, then my proposed orders will be taken to have been entered 14 days from today. 10The parties came back before the Magistrate on 24 October 2011 but that part of the transcript of the proceedings was not before me. I was informed that on that day, the Magistrate made an order dismissing the Cross Claim, exercising her power pursuant to the "slip rule" provisions contained in r 36.17 of the Uniform Civil Procedure Rules (2005) ("the Rules"). Mr Davis, who appeared for Acebond before me as well as in the lower Court, indicated that the Magistrate's reliance upon the slip rule was with the consent of the parties. He also informed me that on the same day, there were submissions made to the Magistrate by both parties in respect of costs, and that a costs order was subsequently made in favour of Acebond. 11There is nothing in the evidence before me which indicates when judgment was formally entered, and it is not clear why the Magistrate adopted the procedure I have outlined above. It was, in my view, open to the Magistrate to simply enter judgment, at the time of giving her reasons, for the amount of the damages to which Acebond was entitled. That course would still have enabled her to hear submissions on the question of costs. More importantly, it would have avoided the uncertainty which now exists surrounding the date on which the judgment was entered. The evidence 12In these proceedings, the plaintiffs filed what have been referred to as "Appeal Books" containing (inter alia) the pleadings, the Affidavits, the transcript of the hearing and the Magistrate's reasons. However, no Affidavit was filed pursuant to r 50.14 of the Rules. It was clear from reading the transcript that a number of documentary exhibits (over and above those annexed to the Affidavits) were tendered in evidence but no such material was contained in the Appeal Books. 13Notwithstanding these matters, the parties indicated that the Appeal Books contained the entirety of the material which they wished me to consider in determining the matter. The application for extension of time 14Pursuant to r 50.12, the Summons in this matter was required to be filed within 28 days after the material date. The term "material date" is defined in r 50.2(1) as follows: material date in relation to an appeal, means: (a)if the appeal is from the decision of a court, the date on which the decision is pronounced or given, and (b)if the appeal is from any other person or body, the date on which notice of the decision was given, by or on behalf of the person or body who made the decision, to the person who wishes to appeal. 15 The term "decision" is defined in the same rule as follows: decision includes a judgment, order, opinion, direction or determination. 16The Magistrate adopted a procedure, unnecessarily in my view, which involved the giving of reasons followed by what were described as "Proposed Orders" which, she said, were to be taken as having been entered 14 days from the date of the reasons. However, that was expressed, in effect, to be contingent upon neither party seeking to have the matter re-listed for any argument as to costs. The difficulty with that, of course, is that the proceedings were re-listed for that purpose, and the question of costs argued. As I have said, there is nothing in evidence before me to establish when judgment was formally entered although in the circumstances, one assumes that it was some time after the making of the costs order. 17The terms of the Summons filed by the plaintiffs seemed to acknowledge that an extension of time was required. In particular, paragraph 8 of the Summons read: The first and second defendant (sic) seek leave to appeal out of time (emphasis added). 18Despite the terms of the Summons, Mr Russo informed me that it represented his "back up" position, and that his primary position was that no extension of time was required. 19Mr Davis submitted that having regard to the chronology of relevant events an extension of time was clearly required. Such chronology is as follows: 30 August 2011 - reasons given by Magistrate 24 October 2011 - matter before Magistrate. Cross Claim formally dismissed pursuant to the slip rule and an order for costs made in favour of Acebond. 21 November 2011 - Summons filed. 20Mr Davis submitted that in these circumstances, the material date for the purposes of r 50.12 was 30 August 2011 and that therefore, the Summons had clearly been filed out of time. 21Mr Russo submitted that because the order dismissing the Cross-Claim was not made until 24 October 2011, it was that date which should be regarded as the material date. He submitted that if that conclusion were reached, it would follow that the Summons had been filed within the 28 day period and no extension of time was required. 22There is no dispute that the Magistrate gave reasons on 30 August 2011. At paragraph [67] of those reasons (AB 174) she concluded that Acebond was entitled to damages in a specified sum. The word "decision" as it is used in Rule r 50.12 is defined so as to include a "determination". The word "determination" is defined in the Macquarie Dictionary as (inter alia): the act of coming to a decision; .... the settlement of a dispute etc by an authoritative decision. 23In my view, the reasons of the Magistrate reflect the making of a "determination" (within the meaning of that term as it is used within the definition of "decision" in Rule 50.2(1) of the Rules) that Acebond was entitled to damages. In these circumstances, it follows that the Summons was required to be filed within 28 days after 30 August 2011. 24I do not accept Mr Russo's submission that 24 October 2011 should be regarded as the material date. There is no dispute that the order of the Magistrate dismissing the Cross Claim was an order made pursuant to the slip rule. That being the case, the Magistrate's order dismissing the Cross-Claim should, in my view, be regarded as having effect from the date of her original determination (as to which see Elyard Corporation Pty Ltd v DBB Needham Sydney Pty Ltd (1995) 133 ALR 206). 25 For these reasons it is my view that an extension of time is required. 26However, a further difficulty arises from the fact that the plaintiffs have not filed any evidence setting out those matters that the Court is asked to take into account in determining whether an extension of time should be granted. When this was raised with Mr Russo he sought an adjournment for the purposes of filing such evidence. That application was opposed by Mr Davis who pointed out that he had raised this very issue in his submissions which were filed and served prior to the matter coming before me for hearing. He submitted that as a consequence, Mr Russo should have been on notice that the issue might arise, and that he should have taken the appropriate steps to deal with it. 27At that point in the hearing, Ms De Palma sought to put a number of submissions to me regarding various health issues with which Mr Russo had recently been faced. Mr Russo then put to me that those health issues constituted, in large measure, the reasons for the delay which had been occasioned in filing the Summons. Mr Davis objected to the manner in which these matters were put before the Court although in fairness, it is apparent from a reading of the transcript of the proceedings before the Magistrate that Mr Russo has been beset with health problems as far back as September 2010. It is also evident from the transcript that due to his ill health, the first day of the hearing before the Magistrate ended prematurely. 28Further, and although the objections taken by Mr Davis were well founded, he candidly accepted that the delay in filing the Summons could not be described as excessive. He also acknowledged that no unfair prejudice had been visited upon Acebond as a consequence of such delay. Indeed, he conceded that he had approached the preparation of the matter on the basis that it would be determined to finality by me, a fact which was reflected in his helpful and comprehensive written submissions. All of that said, and despite Mr Davis' practical approach to the issues, a party who brings proceedings is under an obligation to ensure that all evidence is before the Court so as to enable the relevant issues to be determined. This is all the more so when that party happens to be an admitted Legal Practitioner. 29I am obviously mindful, in dealing with these issues, of the provisions of s. 56 of the Civil Procedure Act. The stated overriding purpose of the Act, and of the accompanying Rules, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. 30In terms of the Court's discretion to extend time, relevant considerations necessarily include the length of the delay and any prejudice caused by extending time (see Currabubula v State Bank of New South Wales [2000] NSWSC 232 at [87] - [88]). As I have noted, the length of the delay is not excessive and there would be no unfair prejudice to Acebond if an extension of time were granted. Further, in my view, an extension of time would facilitate the just, quick and cheap resolution of the real issues between the parties. 31Accordingly, and notwithstanding the unsatisfactory manner in which the issue was approached by the plaintiffs, I am prepared to exercise my discretion in favour of granting an extension of time to bring the application for leave. The application for leave - general considerations 32The submissions filed by the plaintiffs assert that the Magistrate erred "on a question of mixed fact and law". Although not specifically stated, the reference to mixed fact and law is a reference to s. 40 of the Local Court Act which is in the following terms: 40 Appeals requiring leave (1)A party to proceedings before the Court sitting in its General Division who is dissatisfied with a judgment or order of the Court on a ground that involves a question of mixed law and fact may appeal to the Supreme Court but only by leave of the Supreme Court. 33As I have already indicated, the plaintiffs seek leave in respect of two grounds of appeal which arise from: (a)the determination that the Cross-Claim should be dismissed; and (b)the determination that Acebond should be awarded, as part of the damages, an amount of $3,148.40 in respect of fees paid to a Mercantile Agent as a consequence of the breach of the agreement. 34In light of the provisions of s. 40, in order to be granted leave to appeal the plaintiffs must demonstrate that these grounds of appeal involve a question of mixed law and fact. If that is demonstrated, it remains incumbent upon the plaintiffs, in order to obtain leave, to point to some matter over and above the suffering of detriment as a result of the decision in the Court below (see Coulter v R (1987) 164 CLR 350; Chapmans Limited v Yandell [1999] NSWCA 361; Pratten v Johns [2010] NSWSC 327). 35With these matters in mind I turn to consider the application for leave in respect of each ground of appeal. Ground 1 - The Magistrate's dismissal of the Cross Claim The evidence and submissions before the Magistrate 36There was no dispute that on 16 September 2010 Mr Russo was issued with a Notice of Termination of Lease and that he was locked out of the premises on the following day. Similarly, there was no dispute that at the time that Mr Russo was locked out of the premises, there were a number of items therein of which Acebond took possession, and which were subsequently stored. 37There was also no dispute that the arrears of rent which resulted in the issue of the Notice of Termination dated back to the early part of June 2010 and that as early as 31 July 2010, the representative of Acebond had put Mr Russo on notice that it would proceed to lock him out of the premises (see AB 60 to AB 88). 38Against this background, Mr Russo gave the following evidence when cross examined before the Magistrate (commencing at AB 116 L36): Q.Now you would agree that contained within the exhibit to the affidavit of Mr Pugliese, the larger document, are a large number of emails or letters addressed to you dealing with rental arrears? A.There are some, yes. Q.It would not be correct for it to be said that the issue about rental arrears only came up a few days before the Lease was terminated and you were locked out of the premises. It would not be correct to say that, would it? A.No it wouldn't. Q.Now it would also not be correct that the assertion that you were going to be locked out of the premises was only made a few days before the lock out actually occurred. It would not be correct to say that, would it? A.No, he kept threatening to lock me out, yes. Q.So you accept that you had plenty of notice of the landlord's intention to lock you out because of non payment of rent? A.Yes. Q.Yet the problem of non payment of rent continued, did it not? A.Yes. 39Having acknowledged (at AB 118 L10) that in the months leading up to the termination of the agreement he had made no rental payments at all, Mr Russo's attention was then drawn to the Notice of Termination, about which he gave the following evidence (commencing at AB 119 L33): Q.When Mr Pugliese attended upon the premises, he spoke to you - I'm sorry your Honour - on 16 September, knocked on the door and you had a conversation with him? A.Yes. Q...... I suggest to you that you were asked at that point - it was suggested to you - "When could you get your stuff out?" and you said "This afternoon". A.Words to that effect, yes. Q.He said "Well you need to make sure it is out of here because I have a locksmith coming to change the locks". A. That's correct, yes. Q.You acknowledge that? A.Mm. 40Finally, in further cross-examination (commencing at AB 117 L41) he gave the following further evidence: Q.You knew what was coming didn't you? You'd been given plenty of notice about the intention hadn't you? A.As I said, that, that particular week was going to be the week I would have been able - Q.But it wasn't just over the course of one week was it? A.No it wasn't. Q.In fact the rental arrears had been occurring well before you had broken your leg hadn't it? AYes. 41In the course of final submissions in the lower Court, Mr Davis (commencing at AB 147 L 35) took the Magistrate at some length to the provisions of Clause 12.3 of the agreement which were in the following terms: 12.3When this lease ends, unless the lessee become a lessee of the property under a new lease the lessee must - 12.3.1return the property to the lessor in the state and condition that this lease requires the lessee to keep it in; and 12.3.2have removed any goods and anything that the lessee fixed to the property and have made good any damage caused by the removal. Anything not removed becomes the property of the lessor who can keep it or remove and dispose of it and charge to the lessee the cost of removal, making good and disposal. 42In short, Mr Davis submitted that the provisions of Clause 12.3 operated not only to defeat the Cross Claim brought by the plaintiffs, but to permit Acebond to seize and retain the goods, and recover the costs associated with doing so. 43Mr Russo made two submissions to the Magistrate as to the Cross Claim. The first of those submissions (at AB 155 L 18) was in the following terms: I also seek a finding that the good (sic) seized by the plaintiff remain the property of the cross-claimants and that they are entitled to recover those goods. A claim was made for the goods retained on 26 October 2010. At that stage the plaintiff had entered into a new lease for the premises. He didn't disclose that to the defendant, or the cross-claimants. The plaintiff at that stage was aware that he would benefit from the termination. It was an opportunity for him to further mitigate his damages by seeking to return the goods in exchange for rental arrears. 44The second (at AB 157 L 35) was in the following terms: Also, in respect of notices given by the plaintiff, it would be my submission that regardless of the form, the notices should be reasonable and give adequate time and be specific on what they require ...... a period of time in notices should be reasonable to allow the recipient of the notice to carry out whatever was required. 45At no stage before the Magistrate did Mr Russo advance any submission as to the construction of Clause 12.3 and did not, in any way, seek to respond to the submissions which had been made by Mr Davis (particularly at AB 147 line 44 and following) as to the effect of that provision on the Cross Claim. The Magistrate's conclusion as to the Cross Claim 46The Magistrate's conclusions as to the Cross Claim were expressed in the following terms (commencing at AB 172): [52]The defendant/cross claimant cross claimed seeking the return of his goods and furniture. He had valued the retained goods and furniture at $5,460.00. Some of the goods and furniture that were retained by the plaintiff are said to be jointly owned by the defendant and his wife (the second cross claimant in these proceedings). The second cross defendant (sic) also indicated that she purchased other unspecified items that she gave to her husband for use at the leased premises. [53]When the defendant signed the lease, he agreed to its terms including clause 12.3. Although the defendant was not given a lot of time to remove the goods and furniture, he should have realised that if he did not remove them before he was locked out, then the plaintiff would have the right to retain them. [54]I am not satisfied that: the first cross-claimant has proved on the balance of probabilities that he has the right to seek the return of any of the items due to the operation of clause 12.3 of the lease; the second cross-claimant has proved on the balance of probabilities that she is entitled to the return of the unspecified items as it is not even clear what those items were. Leave to appeal 47Because of the difficulty in discerning, from the written submissions, the precise question of mixed law and fact relied upon for the purposes of this Ground, I asked Mr Russo to set it out. The following exchange then took place (commencing at T13 L35): Mr Russo:The Magistrate relied heavily on clause 12.3 of the lease. I put she tried to, relied entirely on clause 12.3, in my submission she read that in isolation. Clause 12 itself is much wider and deals with matters of notice and fixtures to the property and it is, the clause itself should not have been read in isolation, clause 12.3 should not have been read in isolation. His Honour:So you say, do you, that the error of mixed fact and law arises from the Magistrate's failure to properly construe the terms of clause 12.3? Mr Russo:Yes, your Honour. Further, your Honour, she, in clause 7 of her judgment she set out the issues that she intended to direct the parties to and that point wasn't raised by her. 48In my view, on the basis of the question as articulated by Mr Russo, the plaintiffs have failed to identify any question of mixed law and fact stemming from that part of the Magistrate's decision to dismiss the Cross Claim. The Magistrate's findings which lead her to dismiss the Cross Claim were, in my view, findings of fact which were amply supported by the evidence. In these circumstances, leave to appeal should be refused. 49Even if the question, in the terms articulated by Mr Russo, amounted to a question of mixed law and fact, the construction of Clause 12.3 which he now seeks to advance did not form any part of his case before the Magistrate. In my view, this is a further reason why leave should be refused. 50In Metwally v University of Wollongong (1985) 60 ALR 68 the High Court observed (at 71): It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so. 51Similarly, in Chilcotin Pty Limited v Cenelage Pty Ltd [1999] NSWCA 11 Giles JA observed (at [15]): The second principle is that generally parties must be bound by the course they adopted at the trial ...... at least in part this principle is founded on public policy considerations favouring the finality of litigation. 52His Honour continued (at [18]): As always, the particular circumstances must be considered, with due recognition that mistakes occur, that second thoughts are sometimes good thoughts, and that the appellant is entitled to justice; but extending justice to an appellant who has failed to take a point at the trial may work an unacceptable injustice on the respondent. 53When I raised this issue with Mr Russo, he submitted that the statement of the issues in dispute which had been formulated by the Magistrate at the commencement of the hearing (at AB 3) and which she replicated in her judgment (at [7], AB 164) did not contain any reference to Clause 12.3. He submitted that in these circumstances, it was not until the receipt of the Magistrate's judgment that the issue of the construction of Clause 12.3 arose. 54I do not accept those submissions. It was evident, both from the defence to the Cross Claim and from the terms of Mr Davis' final submissions to the Magistrate, that Acebond relied upon Clause 12.3. If Mr Russo wished to make any submission as to the proper construction of that Clause, he should have made it at the time. 55In any event, the submission that Mr Russo seeks to advance as to what he asserts is the proper construction of Clause 12.3, namely that the clause relates only to fixtures, is not one which, in my view, is reasonably open. The terms of Clause 12.3 are quite clear. Those terms required a person in the position of Mr Russo to have removed from the premises: (i)any "goods"; and (ii)anything that was fixed to the property. 56The Clause then provided that "anything" not removed became the property of Acebond. In my view, there is nothing in the use of the term "anything" which would support a conclusion that it should be construed as referring only to fixtures. The term "anything" is necessarily a wide one. Its use tends against the submission that Mr Russo seeks to make. 57Mr Russo's further submission that his position is supported by the decision in Registrar of Titles v Spencer (1909) 9 CLR 64 should also be rejected. As I pointed out to Mr Russo during the course of the hearing, that decision is immediately distinguishable from the present case on a number of bases, including the fact that the parties in that case were not, as he and Acebond were, bound by an agreement which contained Clause 12.3. 58Mr Russo also sought, in the course of the hearing, to make submissions based upon the provisions of the Uncollected Goods Act. He conceded that no such submission was put to the Magistrate. 59Mr Russo then sought to advance an argument that a question of mixed law and fact arose from the Magistrate's conclusions as to the reasonableness of the time that he was given to remove the goods. Implicit in the Magistrate's reasons was a finding that the time given to Mr Russo was, in all of the circumstances, reasonable. That, in my view, was a finding of fact which was amply supported by the evidence, including Mr Russo's own answers in cross examination to which I have referred. 60In this respect, I do not accept Mr Russo's submission that the decision of Waddell J in Ziino & Anor v Wong (unreported, NSWSC 28 October 1980) is authority for the proposition that a period of notice of less than (7) days is to be regarded as unreasonable in each and every case, irrespective of the circumstances. That decision turned on its own facts. In the present case Mr Russo had been on notice, for a long period of time, that Acebond was intending to terminate the agreement and re-enter the premises. He expressly conceded in cross examination before the Magistrate that he was made aware of the need to remove his possessions prior to the locks being changed. He did not assert, at that time, that the period of time he was given was unreasonable, nor did he seek any extension of that period. On the contrary, and on his own admission before the Magistrate, at the time of being served with the Notice of Termination he acknowledged the need to remove his possessions prior to the locks being changed. Moreover, he indicated at that time that he would be in a position to remove all items that same afternoon. 61For all of these reasons I would refuse the plaintiffs leave to appeal on this ground. Ground 2 - The award of Mercantile Agents fees Evidence and submissions before the Magistrate 62In support of its claim under this head of damage in the proceedings before the Magistrate, Acebond relied upon the contents of, and the documents annexed to, an Affidavit of Anthony Pugliesi sworn on 2 May 2011. At paragraph (46) of that Affidavit (at AB 29) Mr Pugliesi deposed to the fact that on or about 22 September 2010 Acebond retained the services of a Mercantile Agent. Annexed to that Affidavit (at AB 113 to 116) were a series of invoices setting out charges payable by Acebond for work done by the Mercantile Agent. One of those invoices set out a charge in the form of a "commission" on any damages recovered. 63Mr Pugliesi was briefly cross examined by Mr Russo (at AB 93) in the course of which the following evidence was given: QI put it to you there would be no need to incur those costs because you had commenced these proceedings? AThese proceedings were commenced through the collection agency. 64In the course of submissions to the Magistrate Mr Russo said (at AB 155 line 46): Further, the plaintiff claims costs of a commission ...... It would be my submission that such a contract wouldn't have been entered into unless it was intending to pass on the cost to tenants. 65Exactly what Mr Russo intended to convey by that submission is not clear. What is clear however, is that at no stage did Mr Russo put to Mr Pugliese that Acebond did not have a liability to pay the Mercantile Agent. Further, Mr Russo did not challenge Mr Pugliesi's evidence that the charges for which Acebond was liable to the Mercantile Agent related to work carried out in association with the commencement of the proceedings. The absence of such challenge was relied upon by Mr Davis before the Magistrate in support of the proposition that Mr Pugliesi's evidence ought be accepted and that the fees incurred should be awarded as part of the damages. The Magistrate's conclusions 66The Magistrate's conclusions in respect of this head of damage are set out in paragraphs [59] to [62] (AB 173 - 175) of her reasons as follows: [59]The plaintiff is a family owned property development company. It is still owed rent and had incurred expenses as a result of the defendant's default under the lease. It engaged a mercantile agent to recover the outstanding rent and expenses (see the mercantile agent's invoices attached to Mr Pugliesi's affidavit. The dispute could not be resolved and it was necessary for the plaintiff to commence proceedings in order to recover the outstanding amounts. [60]Only some of the expected mercantile agent's fees had been incurred as at the date of the hearing as most of the fees will only be payable if the plaintiff is successful in the proceedings. However as is apparent from these reasons, these fees will soon become payable as the plaintiff has largely succeeded on his claim. [61]Clause 5.1 enables the lessor to recover its reasonable costs of remedying the lessee's default and its reasonable legal costs in relation to the default. [62]I am satisfied on the balance of probabilities that it was reasonable for the plaintiff to engage a mercantile agent to pursue the debt on its behalf including commencing these proceedings, and that these costs are recoverable under the lease. Leave to appeal 67In answer to my request to articulate the question of mixed fact and law which arises in respect of this aspect of the Magistrate's findings, Mr Russo responded as follows (at T13 L15 of the transcript): Mr Russo:In respect of the Mercantile agent's fees she held on the balance of probabilities that there was an agreement between Acebond and the Mercantile agent, the Mercantile agent would recover a certain amount. There was no, my submission is that she could not have come to that conclusion because there was no evidence from the Mercantile agent and secondly there was no agreement put by the then plaintiff to the Court on which she could come to those conclusions. His Honour:So your position is, is it, that the evidence didn't support the conclusion that the Magistrate reached? Mr Russo:That's correct, your Honour. His Honour:And you say that that's an error of mixed fact and law? Mr Russo:Yes, your Honour. 68In my view, the question as articulated by Mr Russo does not raise any question of mixed fact and law. The absence of evidence from a representative of the Mercantile Agent, and the failure to tender a copy of the relevant agreement, did not mean that the Magistrate's factual conclusions were unsupported by the evidence. Her findings were, in my view, supported, firstly by the evidence of Mr Pugliesi (which was not the subject of any real challenge) and secondly, by the documents annexed to his Affidavit (to which no objection was taken by Mr Russo). For these reasons, leave to appeal on this ground should be refused. 69Further, and once again, the submission Mr Russo now seeks to make was not one which was made to the Magistrate. At no stage did he submit to the Magistrate that the evidence was incapable of supporting an award of damages under this head. Even of a question of mixed law and fact arose in the manner submitted by Mr Russo, the fact that the submission he now seeks to make was not part of his case before the Magistrate would lead me to refuse leave to appeal on this ground. 70Similar observations can be made in relation to Mr Russo's submission before me that the damages awarded under this head were too remote. No such submission was ever put to the Magistrate. 71For these reasons I would refuse leave to appeal on this ground. Orders 72I therefore make the following orders: (1)The time for filing of the Summons is extended to 22 November 2011. (2)Leave to appeal is refused. (3)The Summons is dismissed. (4)The plaintiffs are to pay the defendant's costs. ********** 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. Decision last updated: 05 April 2012