Al Mousawy v Presdate Pty Limited & Anor

Briggs v James Hardie & Co Pty Limited (1989) 16 NSWLR 549 Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 at 550 Dow Corning & Anor v Paton (1998) Aust Tort Reports 81-485 Elvines v Herron, at 7, unreported, Badgery-Parker J, 14 December 1995 CASES CITED : Firth v Latham & Ors [2007] NSWCA 40 Gallo v Dawson (1990) 64 ALJR 458 Holt v Wynter (2000) 49 NSWLR 128 Parsons v Doukas (2001) 52 NSWLR 162 Sydney City Council v Zegarac (1998) 43 NSWLR 195 at 197 Szerdahelyi v Bailey (unreported, Badgery-Parker J, 1 May 1997

Thakee Khdyeyer Al Mousawy - Applicant PARTIES : Presdate Pty Limited - First Respndent Australian Town Planning Consultants Pty Limited - Second Respondent

Mr Wilson - Applicant COUNSEL : Mr Doak - First Respondent Mr Bernie - Second Defendant

Keddies - Applicant SOLICITORS : Guild Legal Ltd - First Respondent Robert Silberberg - Second Respondent

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

20244/2004 - Thakee Khadeyer AL MOUSAWY v HOWITT-STEVENS CONSTRUCTIONS PTY LIMITED & ORS

JUDGMENT 1 HIS HONOUR: Nature of claim and factual background As of 24 November 2002 the proposed first defendant, Presdate Pty Limited (hereafter called "Presdate"), was the owner of the Stonewall Hotel at 173-175 Oxford Street Darlinghurst in the State of New South Wales (the hotel). The lessee of the hotel at that time was Stonewall Hotel Pty Limited, the proposed second defendant (hereafter called "Stonewall"). 2 The top floor of the hotel was used as a dance floor. In the draft amended statement of claim the plaintiff alleges that by 11 June 2002 Presdate and Stonewall were aware that complaints had been received from patrons that this dance floor felt insecure when large numbers of patrons were dancing on it. 3 The draft amended statement of claim asserts that after being made aware of that complaint, Presdate and/or Stonewall engaged Australian Town Planning Consultants Pty Limited, the proposed fourth defendant (hereafter called "the consultant"), to assist with planning advice and in retaining a firm of structural engineers. 4 The plaintiff alleges that Stonewall and the consultant retained the proposed third defendant, JA Byatt Pty Limited (hereafter called "Byatt"), as structural and civil engineers to inspect the hotel including the top dance floor. 5 The plaintiff alleges that on 24 November 2002 the top dance floor of the hotel collapsed on to the floor below causing injury to a number of persons, including the plaintiff. 6 The plaintiff alleges that Presdate and Stonewall were in occupation of the hotel and had care and control of it. He alleges that Byatt made a faulty assessment of the top dance floor and provided incorrect advice in relation to it and that the consultant did not properly instruct Byatt and failed to advise Byatt about the complaints made by patrons concerning the top dance floor. 7 On 23 June 2004 proceedings in negligence were commenced in the District Court by Paul Zeeland against Stonewall and Presdate. 8 On 3 November 2004 each of the plaintiff, Mark Turjman, Corey Butler and Stephen McKenzie commenced separate proceedings in negligence in the Supreme Court against Howitt-Stevens Construction, AB & S Wall Lining Pty Limited, Byatt and Stonewall. 9 On 31 August 2005 Antonino Tati commenced proceedings in negligence in the District Court against Presdate, Stonewall, Australian Town Planning Consultants 2 Pty Limited and the Sydney City Council and Byatt. 10 On 16 November 2005 Alanna Calluaud commenced proceedings in negligence in the District Court against Presdate, Stonewall and Byatt. 11 On 21 November 2005 Daryl Shute commenced proceedings in negligence in the District Court against Stonewall and Byatt. 12 On 23 November 2005 Dominic Vella commenced proceedings in negligence in the District Court against Stonewall and Presdate. 13 In the proceedings in which it was a defendant Presdate cross-claimed against Stonewall on the basis of indemnity provisions in the lease between them. In the Tati matter Stonewall cross-claimed against Presdate and asserted that Presdate was an occupier of the hotel and together with Stonewall was in control of it. 14 In July 2006 the District Court matters were transferred to the Supreme Court and thereafter all of them proceeded together. Howitt-Stevens Constructions and AB and S Wall Lining Pty Limited are no longer involved in the proceedings. The claim by Paul Zeeland has resolved. The other eight matters are continuing. 15 As a result of discussions between the parties, it was decided that it would be more cost effective and efficient for all of the claims to be consolidated into one statement of claim. In order to effect that result a draft amended statement of claim has been prepared which names as the defendants Presdate, Stonewall, Byatt and the consultant. It is that document which I have referred to as the draft amended statement of claim. The proposed defendants have agreed to that course of action. The consent of Presdate and the consultant is, however, subject to the plaintiff being successful in an application for an extension of time within which they can be joined as defendants. 16 It is that application which is now before the Court. The application is made pursuant to s60C of the Limitation Act 1969 for an extension of time so that Presdate and the consultant can be added as defendants to the proceedings brought by the plaintiff. Presdate and the consultant agree to be bound by the outcome of this application and will not require those other plaintiffs who have not already joined them to make similar applications. On the same basis, those other plaintiffs have agreed to be bound by the outcome of this application should it be unsuccessful.

Joinder of Presdate 17 The limitation period expired on 23 November 2005. The plaintiff's motion to join Presdate was filed on 19 March 2007, ie sixteen months after the expiration of the limitation period. It was common ground that for the plaintiff to succeed he would have to satisfy the provisions of ss60C and 60E. 18 Those sections relevantly provide: "60C … (2) If an application is made to a court by a person claiming to have a cause of action to which this section applies, the court, after hearing such of the persons likely to be affected by the application as it sees fit, may, if it decides that it is just and reasonable to do so, order that the limitation period for the cause of action be extended for such period, not exceeding 5 years, as it determines. … 60E (1) In exercising the powers conferred on it by section 60C or 60D, a court is to have regard to all the circumstances of the case, and (without affecting the generality of the foregoing), the court is, to the extent that they are relevant to the circumstances of the case, to have regard to the following: (a) the length of and reasons for the delay, (b) the extent to which, having regard to the delay, there is or may be prejudice to the defendant by reason that evidence that would have been available if the proceedings had been commenced within the limitation period is no longer available,

(c) the time at which the injury became known to the plaintiff,

(d) the time at which the nature and extent of the injury became known to the plaintiff,

(e) the time at which the plaintiff became aware of a connection between the injury and the defendant's act or omission,

(f) any conduct of the defendant which induced the plaintiff to delay bringing the action,

(g) the steps (if any) taken by the plaintiff to obtain medical, legal or other expert advice and the nature of any such advice the plaintiff may have received,

(h) the extent of the plaintiff's injury or loss. …" 19 In relation to s60E it was common ground between the plaintiff and Presdate that there was no actual prejudice if an extension of time were granted. The plaintiff submitted that the effect of any presumptive prejudice was significantly reduced in that Presdate was already a defendant in three of the eight matters which were continuing. In other matters Presdate was already joined as a cross-defendant. Accordingly, it was submitted that apart from the obvious detriment of being directly exposed to additional claims, the position of Presdate would be no worse than it was already was. 20 It was submitted that the extent of the delay was modest, ie sixteen months. Following the accident the plaintiff had carried out inquiries and had learned that Presdate was the owner of the premises and that Stonewall was the lessee. The plaintiff had also become aware of the provisions of the lease which on its face required Stonewall to indemnify Presdate in respect of any liability which it might incur in respect of Stonewall's occupation of the premises. On that material there was no reason for the plaintiff to bring proceedings against Presdate. 21 It was only when all of the claims were brought together in the Supreme Court and the plaintiff's legal advisers examined the pleadings in other matters that they learned that Stonewall was alleging that Presdate was an occupier of the hotel and was at least, in part, in control of it at the relevant time. The plaintiff had become aware of that information in August 2006. That was the first time the plaintiff's legal advisers became aware of a possible connection between the plaintiff's injury and any act or omission on the part of Presdate. The delay between that date and the motion for an extension of time in March 2007 was due to attempts to consolidate the pleadings generally and a mediation which had been fixed for December 2006. 22 The affidavit of Ms Griffiths of 15 March 2007, it was submitted, set out in detail the steps taken on behalf of the plaintiff to investigate the circumstances of the accident and these steps were in all the circumstances reasonable. In relation to the extent of the plaintiff's injuries it was submitted that he was now 32 and had suffered severe back and head injuries as a result of the collapse of the dance floor. These were of sufficient severity to prevent him from engaging in heavy work for the rest of his life. 23 In response Presdate relied upon the "just and reasonable" requirement in s60C for the exercise of the court's discretion. It submitted that there was no evidence before the Court which could establish that Presdate at the relevant time was an occupier of the hotel and had any direct control over it. In that regard it was submitted that all that the plaintiff had become aware of in August 2006 was a bare allegation by Stonewall in a cross-claim as to those matters. 24 Presdate submitted on the authority of Dow Corning & Anor v Paton (1998) Aust Tort Reports 81-485 that a plaintiff seeking an extension of time for the joinder of a defender must adduce sufficient evidence to establish a viable cause of action. Presdate accepted that it was no longer necessary for a plaintiff to establish a prima facie case but some evidence indicative of the existence of a viable case had to be placed before the court. In this application no evidence of liability on the part of Presdate had been adduced. 25 Because of that absence of evidence Presdate submitted that it was futile to grant an extension of time. Presdate submitted that it was not sufficient for the plaintiff to point to a pleading (which was in time) in which the same allegations had been made against Presdate as were contained in the amended Statement of Claim. 26 It was also submitted by Presdate that the plaintiff had all relevant information about Presdate upon the completion of its investigation and searches in 2003. The only additional information was the allegations in the pleadings which had come to the attention of the plaintiff's legal advisers in August 2006. In reality the plaintiff had no more evidence now than he had had in 2003 so that this application was not just and reasonable. 27 Except in relation to sub-para (1)(e) of s60E Presdate did not submit that any of the matters there set out were adverse to a finding that it was just and reasonable to grant an extension of time to the plaintiff. Even the reference to sub-para (1)(e) of s60E was part of Presdate's overall submission that the application should fail because of the absence of any evidence of liability on the part of Presdate. 28 In Sydney City Council v Zegarac (1998) 43 NSWLR 195 at 197 the following uncontroversial propositions were set out: "1. Section 60C confers a judicial discretion. 2. The discretion is a discretion to grant, not a discretion to refuse, an extension of the primary limitation period. The court must be satisfied that it is "just and reasonable" to make the order for extension: see also Brisbane South (at 544, 547, 554, 567-568). 3. In exercising the discretion, the court is required "to have regard to all the circumstances of the case" (s 60E(1)). It is also required to have regard to the eight factors listed in s 60E(1) "to the extent that they are relevant to the circumstances of the case". 4. Among those circumstances to which a court must have regard are the rationales for the existence of limitation periods which were identified in those passages from the Attorney-General's Second Reading Speech that are set out in the other judgments, and which McHugh J discusses in Brisbane South (at 551-553 ) : see also Kirby J (at 563-564). " 29 Assistance is also provided by Parsons v Doukas (2001) 52 NSWLR 162 at [1]: "[1] I have had the benefit of reading the reasons for judgment prepared by Powell JA and by Davies A-JA. In my reasons for judgment in Holt v Wynter (2000) 49 NSWLR 128, I concluded, on the basis of the authorities referred to, that an application for an extension of time under limitation legislation should be refused if the effect of granting the extension would result in significant prejudice to the potential defendant (at 147 [119]). The authorities also deal with the tests to be applied where there has been long and unexplained delay which has not resulted in significant prejudice to the potential defendant. In that context as I said (at 146 [113]) it may be that, in the absence of significant prejudice to a potential defendant, there is no reason why the discretion should not be exercised in favour of the applicant. However, the authorities do not in my opinion suggest that the court is bound to grant leave to commence proceedings in the absence of proof of any significant prejudice to the proposed defendant in doing so, for example in a situation of long and unexplained delay: Holt v Wynter (at 147 [116]). The real question remains as Toohey J and Gummow J pointed out in Brisbane South Regional Health Authority v Taylor ( 1996) 186 CLR 541 at 550: "... whether the delay has made the chances of a fair trial unlikely. If it has not there is no reason why the discretion should not be exercised in favour of the respondent."" 30 It is useful to set out in detail the statement of principle upon which Presdate relies in opposing this application. In Dow Corning at 65245 Beasley JA said: "Senior Counsel for the appellants acknowledged that sections 60G and 60I did not, as a matter of statutory mandate, require an applicant for extension of time to adduce evidence of negligence, that is evidence of the existence of a cause of action or even evidence that evidence was available, or likely to be available for the purposes of the trial. See Szerdahelyi v Bailey (unreported, Badgery-Parker J, 1 May 1997). However, in that case, Badgery-Parker J, at 6, referred to what he had earlier said in Elvines v Herron , at 7, (unreported, Badgery-Parker J, 14 December 1995): "But whether there is evidence available to establish the cause of action will, at the least, be always a relevant consideration and in many a case the absence of such evidence must necessarily prove fatal to a contention that it is just and reasonable to extend the period". … There is, therefore, significant merit in the appellants' submission. The level of evidence adduced on behalf of the respondent was so minimal, and in the case of Dow non-existent, that, for the application to succeed, the Court would have to proceed on the bases of at least the following assumptions: (i) That Dow manufactured and supplied the prostheses; (ii) That the 1979 implants either ruptured, or "bled" or both; (iii) That whatever Dr Meares did say to the respondent (and there must have been some discussion) it did not amount to a warning that there was a risk of gel bleed or rupture; (iv) That the prostheses were cosmetically unsatisfactory, whatever that may mean in respect of the respondent; (v) That she is suffering from an atypical rheumatic syndrome; (vi) That the condition was caused by or contributed to by the presence of high levels of silicone in the respondent's body; (vii) That it was not known in 1979 (in the case of Dr Meares and Dow as well as 1990 in the case of Dr Rea and Dow) that prostheses such as these were liable to rupture and to be subject to gel bleed; (viii) That the respondent would not have undergone the operation had she been properly advised. There was no suggestion that the evidence necessary to prove these assumptions, or even to indicate that they could be proved, was unobtainable or difficult to obtain. Indeed, much, if not all, should have been easily obtainable. Subject only to what follows, I am unpersuaded that this case falls into an exceptional category which would require, or as a matter of discretion call for, the making of an order for extension of time. Counsel for the respondent, did not contest that there was an absence of evidence in respect of the case against Dow and a paucity of evidence in respect of the case against Dr Meares. However, he sought to maintain the order for extension against each appellant on the basis that the respondent was entitled to the benefit of the principle referred to in Briggs v James Hardie & Co Pty Limited (1989) 16 NSWLR 549. The operation of that principle was described by Hope JA at 554, as follows: "Where a plaintiff brings an action against two defendants alleging that one or both are liable, and there is some evidence to connect each defendant with the events that the subjects of the action, then provided the plaintiff establishes a prima facie case against one of the defendants, the other defendant will not be dismissed from the action until the whole of the evidence has been heard. As it seems to me this means that a plaintiff is entitled to bring an action against two defendants if he has evidence to establish a prima facie case against one of the defendants, and also has evidence pointing to the possibility of the other defendant being liable."" 31 In the draft amended statement of claim liability is alleged against Presdate and Stonewall as joint tortfeasors. The lease and other documents make it clear that Stonewall was an occupier and in control of the hotel at the relevant time. Prima facie, therefore, a cause of action has been established against Stonewall. 32 In relation to Presdate it is not accurate to say that there is no evidence of the existence of the cause of action. Presdate was the owner. There is a cross-claim by Stonewall (filed 30 November 2005) asserting that Presdate had the care and control of the hotel. That allegation is supported by a certificate under s347 of the Legal Profession Act 2004 by the solicitor for Stonewall asserting that "there are reasonable grounds for believing on the basis of provable facts and a reasonably arguable view of the law that the claim for damages in these proceedings has reasonable prospects of success". It is of significance that this cross-claim is brought by the entity, Stonewall, which is in the best position to establish whether Presdate was exercising some level of control over the hotel at the relevant time. 33 On that material, applying the principle in Briggs and Dow Corning, it seems to me that it is just and reasonable that the plaintiff be granted an extension of time within which to proceed against Presdate. It has never been suggested that a fair trial is not possible if such an order was made. 34 There is another reason which persuades me that it is just and reasonable for an extension of time to be granted. Presdate continues to be a defendant in the proceedings by Alanna Calluaud and Dominic Vella. It continues to be a cross-defendant in at least four of the proceedings. It will not be known until all of the evidence has been heard whether or not a case has been made out against Presdate in those proceedings. If Presdate is found liable in those proceedings, it would be unfair if this plaintiff was prevented from pursuing such a claim because he is not in a position at the present time to adduce evidence that he has a viable case against Presdate. 35 If ultimately such evidence is not forthcoming, not only will Presdate be protected by an order for costs in its favour against the plaintiff, but depending upon the nature and strength of the evidence ultimately adduced against it, there may be a basis for Presdate seeking costs against the plaintiff's legal advisers (Firth v Latham & Ors [2007] NSWCA 40). That would seem to be the clear intention behind s345 of the Legal Profession Act 2004. 36 Taking those matters into account, and also taking into account the matters submitted on behalf of the plaintiff in respect of s60E, and in the absence of proof of any significant prejudice to Presdate, I propose to exercise my discretion in favour of the plaintiff and to extend the period of time within which he can bring proceedings against Presdate.

Joinder of consultant 37 The plaintiff's submissions in relation to the consultant are similar to those put forward in respect of Presdate. In the case of the consultant, however, it was not a defendant in any of the proceedings except those brought by Antonino Tati and in that matter it was wrongly named. I am told from the bar table, but no-one has denied the accuracy of the statement that subsequently proceedings were discontinued against the consultant in the Tati matter. It remains a cross-defendant in all matters. 38 As with Presdate the plaintiff submits that no actual prejudice will arise if an extension of time were granted. Despite inquiries the plaintiff's legal advisers were unaware of the part played by the consultant until they saw the cross-claim of Byatt filed on 31 August 2006. That cross-claim alleged that the consultant had failed to advise Byatt of relevant information in its possession, in particular it failed to advise Byatt of the existence of complaints concerning the top dance floor. That cross-claim was verified by a certificate under s347 of the Legal Profession Act 2004 signed by the solicitor acting for Byatt. 39 The plaintiff submitted that because of this dispute as to liability between Byatt and the consultant, it was necessary to have the consultant as a defendant in the proceedings. This was because the allegations of Byatt in the cross-claim might provide a complete defence to Byatt if made out. It was therefore just and reasonable that an extension of time be granted so that the consultant could be properly joined to the proceedings. 40 The only evidence relied upon by the consultant was a report of Byatt, dated 12 August 2002, addressed to "The Proprietors of the Stonewall Hotel c/- Australian Town Planning Consultants Pty Limited" (exhibit 1). It was submitted that the part played by the consultant was merely that of a conduit of information between Stonewall and Byatt. It was submitted that had proper inquiries been made by the plaintiff and subpoenas issued, this information would have been obtained before the expiration of the limitation period and that consequently sub-paragraph (1)(g) of s60E was adverse to the plaintiff's application. The consultant submitted that as with Presdate there was a lack of evidence as to the existence of a viable case against it. 41 The consultant also relied upon presumptive prejudice. The court was referred to Gallo v Dawson (1990) 64 ALJR 458 and the matters taken into account by McHugh J in that case. 42 Unlike Presdate there was evidence before the court of the involvement of the consultant in the preparation of the engineering report of Byatt. There was no issue that Stonewall had retained the consultant to act on its behalf. There was evidence that it was the consultant who had provided instructions to Byatt (exhibit 1 and letter of 3 July 2002). In my opinion there is ample evidence available as to a possible cause of action against the consultant. 43 It seems to me that the matters in s60E of the Act favour the application. The delay has not been lengthy and no significant prejudice has been identified. These matters will have to be litigated by the consultant in any event because of its joinder within time as a cross-defendant by Byatt. Although some presumptive prejudice does exist, its effect is not particularly significant given the relatively short extent of the delay. 44 It seems to me that the explanation offered by the plaintiff for not bringing proceedings against the consultant within time is reasonable. The fact of the involvement of the consultant and the part which it played would not have been obvious to the plaintiff from the facts of the incident. It was only when the cross-claim of Byatt was filed on 31 August 2006 that these matters emerged. Until then there would have been no reason for the plaintiff to issue subpoenas and take other steps to clarify the position of the consultant. 45 The decision in Gallo v Dawson does not assist the consultant. It involved an application for an extension of time within which to bring an appeal in the High Court. Not only did it involve a consideration of the relevant High Court Rules, but the application failed primarily because the appeal was hopeless. The principles which apply to this application are different. This application turns on the effect of ss60C and 60E. 46 For those reasons I am persuaded that a fair trial is possible if an extension of time is granted to the plaintiff within which to bring proceedings against the consultant and that it is just and reasonable to extend the limitation period to enable him to do so.

Orders 47 The orders which I make are as follows:

(i) The limitation period is extended pursuant to s60C of the Limitation Act 1969 up to and including 25 May 2007.

(ii) The plaintiff is to pay the costs of this application. **********

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