Albert St Group Pty Ltd v Universal Real Estate Vic North Pty Ltd

By the proposed cross-claim, the First Respondent seeks damages and/or compensation pursuant to ss 236 or 237 of the Australian Consumer Law (ACL) for Mr Darji’s contraventions of ss 18 and/or 30 of the ACL, as well as contribution pursuant to Part IV of the Wrongs Act 1958 (Vic). The material facts pleaded in the proposed cross-claim are substantially adopted from those relied upon in the main claim.

I am therefore satisfied it is closely related to the main claim and relates to very similar (if not identical) facts and issues.

The First Respondent’s defence was filed on 23 July 2025. Ms Cappellotto’s affidavit provides the following explanation for not filing the notice of cross-claim on that date:

In relation to prejudice caused by the delay, Ms Cappellotto states:

The affidavit of Ms Cappellotto contains a draft notice of cross-claim that complies with r 15.02, in compliance with r 15.05(2). The notion that the application would not occasion delay is consistent with the position taken by the Applicant and Second Respondent, who neither consent to, nor oppose, the application.

Delay is the main issue in this application. The interlocutory application seeking leave to file the notice of cross-claim was filed over eight months after the cross-claim was required to be filed under r 15.04. I consider that this is a significant delay (see, eg, Swift at [26]).

The explanation for the delay after the First Respondent’s legal team realised in August 2025 that a cross-claim would be necessary is unsatisfactory. In Swift, Cheeseman J considered a circumstance where a party deliberately deferred seeking leave to file a cross-claim until after the mediation proved to be unsuccessful. Her Honour observed at [29]-[30]:

As this passage highlights, the purpose of the Rule which requires the filing of a cross-claim at the time of the defence is, in part, to ensure that all issues that may bear upon the outcome of the matter are ventilated at an early stage. Ms Cappellotto suggests in her affidavit that she sought to avoid the expense and inconvenience of joinder if the matter could, in any event, be resolved. That argument might have some weight, but no explanation is then given for the delay between the conclusion of the mediation in December, and the filing of the application in April. That delay is unsatisfactory. It follows that this factor weighs somewhat against the grant of leave. However, it is submitted that the delay is not so inordinate that the First Respondent ought to be prevented from prosecuting its cross-claim, and the proposed orders do not propose re-visiting steps already undertaken. Importantly I accept that the delay was not taken for tactical or forensic benefit.

Ms Cappellotto’s evidence is that she does not expect that the proposed cross-claim would require any amendment to the existing pleadings, additional discovery or evidence.

On 18 August 2025, the proceeding was listed for trial commencing on 12 October 2026 on an estimate of five days. On the same date, a timetable was set under which the pleadings concluded on 20 August 2025, discovery concluded on 19 August 2025, lay evidence was due to be filed by 7 November 2025, and expert evidence was due to be filed by 9 March 2026 (by the Applicant) and 4 May 2026 (by the Respondent). This timetable has been complied with, save for some evidence that appears to have been filed outside the time permitted by the Court’s orders. The parties have not sought leave to rely on evidence filed outside the time permitted by the Court.

No party has submitted that it will suffer prejudice as a result of the joinder of Mr Darji. Accordingly, the only prejudice I consider relevant is the possibility that the dates set down for the trial will be disturbed.

The First Respondent has proposed a set of orders dealing with the timing of, inter alia, discovery, evidence, objections, agreed facts and submissions as between the First Respondent and Mr Darji. Those proposed orders would retain the trial date currently listed. I have considered those orders, and in my view they are appropriate.

For those reasons, this consideration favours the grant of leave.

As observed in Swift (at [36]), “[t]he assessment of the merits of the proposed cross-claim on an application such as this is necessarily approached in a summary way”. It is sufficient to note that the draft statement of cross-claim evinces an arguable case and states the facts relied upon to establish the claim with clarity. It is not deficient on its face (cf Swift at [36]; Martin v Twin Creeks Golf & Country Club Ltd [2021] FCA 1499 at [49]-[52] (Abraham J)).

It is not appropriate to consider the merits in depth; it is sufficient to say that the proposed cross-claim is not deficient on its face. The merits of the proposed cross-claim favour the grant of leave.

The proposed cross-claim is closely connected to the subject matter of the proceeding. The representations alleged in the statement of claim to have been misleading were conveyed to Mr Darji, and passed on by Mr Darji to Mr Gupta, the sole director and shareholder of the Applicant. For that reason, there is likely to be significant, if not complete, overlap in the facts relevant to the substantive proceeding and those relevant to the cross-claim. This factor favours the grant of leave.

In all the circumstances, I am content it is appropriate to grant leave in the manner sought, and to make the consequential orders for the progress of the matter proposed. I will make the orders broadly in the for proposed, however it is appropriate that the cross claim be filed and served more quickly than the orders contemplated. Mr Darji will, of course, be able to seek any necessary amendments by application.