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[2023] WASCA 32
General information, not legal advice.
Court of Appeal (WA)
2023-02-14
Buss P
Original judgment source is linked above.
By reason of impaired credit scores for both myself and [the appellant] it has unfortunately taken me longer than first expected to raise the money as I have had to approach private lenders outside the banking system. I had genuinely believed that I had raised the money through a third party and had even told my solicitors that the funds would be paid into court prior to Christmas. Due to reasons beyond the control of myself and the party loaning me the money access to the money became delayed.
I am now expecting the money to be available by the end of this month. However in anticipation of further delays (which I am not expecting) I am making contingency plans to source the funds from elsewhere and I am confident of making either payment into court or providing some other acceptable form of security such as a bank guarantee by the end of this month.[2]
Unless [the appellant] complies with order 1 of the order made on 29 September 2021, and pays $50,000 into court as security for costs of [the respondent], by Friday, 4 February 2022:
(a) the action be and hereby is dismissed; and
(b) [the appellant] shall pay [the respondent's] costs of the action, including all reserved costs.
The master's reasons for dismissing the application
It is always a difficult matter to dismiss an action without the merits of that action being considered. On the other hand, there is, for very good reasons, a capacity for a defendant to seek security for costs from the plaintiff.
Once an order is made, the matter just can't go on indefinitely. There has to be a timeframe within which the security is to be provided. The timeframe should be reasonable. And, looking again at the file, I was satisfied at the time that the period offered to the plaintiff to provide the security was reasonable.
A further extension was granted with a springing order. Inherent in the making of that order was the view I took that while an extension was justified, the matter had to be brought to a conclusion if justice was to be done between the parties. In other words, I was satisfied it was in the interests of justice to offer an extension, provided that the security was paid within that period.
An application [for an extension of time to comply with the self‑executing order] was made on the last day for provision of that security. It was supported by an affidavit of Mr Esposito. With great respect, there's nothing in that affidavit which offers any concrete support for the proposition that funding would be available in the short term.
If this was a case where the documents annexed to an affidavit indicated that the money was available, that there was a short hiatus while the cheques were cleared, or some such steps were taken to ensure funds would be available, that would be an entirely different thing. I would have no hesitation in extending the time. But, here, what is sought, is an extension and the period of the extension isn't entirely clear from the affidavit material. But assuming that it's an extension of two weeks, there's nothing in the material which I could - upon which I could be satisfied that within that two-week period the security would be provided.
To use the colloquial expression, it just seems that the plaintiff is acting on a wing and a prayer.
For those reasons, I'm not prepared to extend the time for compliance with the order.[5]
The master erred in fact and in law in dismissing the appellant's application seeking an extension of time to make payment into court. In particular
1.1. The master erred in law and in fact in fact [sic - repetition in original] in finding in effect that there had been no concrete evidence put forward that funding (for the amount of the security for costs required) would be available within the 14 day extension period sought.
1.2. The master should have found that the appellant's directors [sic] evidence under oath sworn 4 February 2022 contained sufficient enough proof and evidence of steps having been taken to secure funding for the security and the appellant should have been afforded the extended opportunity of making the payment into the court.
1.3. The master failed to properly weigh and factor into account and consider the gravity of the consequences of the refusal to grant the extension (namely the dismissal of the case) before exercising his discretion to refuse the application.
1.4. The exercise of the master's discretion to refuse to grant a further extension in this case on evidentiary grounds - namely that there was (to quote the Master) 'nothing in the affidavit which offers any concrete support for the proposition that funding would be available in the short term' was unreasonable and against the weight of the evidence and leads to a manifestly injust [sic] outcome. The result is particularly unjust in the light of the masters [sic] earlier comments at the time of ordering security for costs on 29 September 2021 that if an extension of time to provide security was sought by the appellant an extension of time would be given. The master further stated at the time of making the springing order on 13 January 2022 that the time for compliance with the springing order could be extended even after the order had sprung. Indeed the court does have power to extend the time for compliance with a springing order, even after judgment has been entered by it's [sic] automatic operation.
Applicable legal principles on application for extension of time to comply with a self-executing order
(1) The Court may, on such terms as it thinks just, by order extend or abridge the period within which a person is required or authorised by these rules, or by any judgment, order, or direction, to do any act in any proceedings.
(2) The Court may extend any such period as is referred to in subrule (1) although the application for extension is not made until after the expiration of that period.
Ground 1.1 & 1.2: Did the master mistake the facts?
I was recently put in contact with a number of reputable litigation funding providers that I did not previously known [sic] about and wasn't aware that I qualified for and was eligible to receive funding for a range of litigation related purposes. I have in the last two weeks been in discussions with a number of litigation funding providers and have impressed upon them the urgency of my situation. At least two funders have indicated a genuine willingness to assist me financially on terms which I fully understand. There is likely to be some security involved that I aim [sic] able to provide as I have a small trail commission that I have been rebuilding. I am told it could take another 7 days to complete the exercise enabling funds to be released. I am now very confident that I will have the money within that time but 14 days is a more realistic timeframe I believe.[26]
Ground 1.3: Did the master fail to take into account a material consideration?
It is always a difficult matter to dismiss an action without the merits of that action being considered.
Ground 1.4: Was the master's decision unreasonable or plainly unjust?
The paucity of the appellant's affidavit evidence was a weighty factor against the favourable exercise of the discretion. Prima facie time limits must be obeyed. In order to justify an extension it was incumbent on the appellant to adduce evidence as to why, despite proper endeavours, it had failed to comply with the court's orders and why it was to be expected that the appellant would be able to comply with the court's orders if afforded a reasonable extension of time. The appellant's affidavit evidence was unsatisfactory in both respects.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
[1] Mr Esposito's affidavit sworn 12 January 2022 par 3 BAB 36.
[2] Mr Esposito's affidavit sworn 12 January 2022 pars 4 - 5 BAB 37.
[6] House v R [1936] HCA 40; (1936) 55 CLR 499, 504 - 505. As to the formulation of a ground of appeal alleging discretionary error in accordance with the principles in House v R see generally Durham v Durham [2011] NSWCA 62; (2011) 80 NSWLR 335 [71] - [74].
[8] FAI General Insurance Co Ltd v Southern Cross Exploration NL [1988] HCA 13; (1988) 165 CLR 268, 283 - 284 (the approach adopted in that passage being equally applicable to O 3 r 5 RSC: Biala Pty Ltd v Mallina Holdings Ltd (1989) 2 WAR 381, 387, 399).
[9] Ogbonna v Programmed Integrated Workforce Ltd [No 2] [2022] WASCA 79 [105].
[10] Melville v East End Holdings Inc [2003] WASCA 133 [17].
[11] FAI General Insurance Co Ltd v Southern Cross Exploration NL (286), (290). See also: Melville v East End Holdings Inc [17]; Wharton v R [No 2] [2015] WASCA 176 [48] - [49].
[12] Wharton v R [No 2] [50]; TP Engineering Pty Ltd v JM [2015] WASCA 181 [53]. (Both referring to MTQ Holdings Pty Ltd v Lynch [2007] WASC 49 [51].)
[13] Wharton v R [No 2] [50] (referring to MTQ Holdings Pty Ltd v Lynch [54]); TP Engineering Pty Ltd v JM [53] (referring to MTQ Holdings Pty Ltd v Lynch [54]); A v C [No 2] [2015] WASCA 199 [2].
[14] Wharton v R [No 2] [50] (referring to MTQ Holdings Pty Ltd v Lynch [54]); TP Engineering Pty Ltd v JM [53] (referring to MTQ Holdings Pty Ltd v Lynch [54]); A v C [No 2] [2].
[15] Samuels v Linzi Dresses Ltd [1981] QB 115, 126 ‑ 127.
[16] As to which see Durolek v Pier (WA) Pty Ltd [No 2] [2019] WASCA 138 [107] - [108], [110] - [111].
[17] FAI General Insurance Co Ltd v Southern Cross Exploration NL (283).
[18] Wharton v R [No 2] [50] (referring to MTQ Holdings Pty Ltd v Lynch [55]); TP Engineering Pty Ltd v JM [53] (referring to MTQ Holdings Pty Ltd v Lynch [55]); A v C [No 2] [3].
[19] Wharton v R [No 2] (referring to MTQ Holdings Pty Ltd v Lynch [56]); TP Engineering Pty Ltd v JM [53] (referring to MTQ Holdings Pty Ltd v Lynch [56]); A v C [No 2] [4].
[20] See eg Skahill v Kestral Holdings Pty Ltd (in liq) [2000] WASCA 185 [10].
[21] See eg Osgood v Wham [2007] WASCA 178 [52], [56].
[22] Wharton v R [No 2] [50] (referring to MTQ Holdings Pty Ltd v Lynch [51]); TP Engineering Pty Ltd v JM [53] (referring to MTQ Holdings Pty Ltd v Lynch [51]).
[24] NRW Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [2020] WASCA 107 [117] - [118].
[26] Mr Esposito's affidavit sworn 4 February 2022 par 7 GAB 32.
[27] Appellant's PD 7.4 Schedule WAB 17.
[28] Compare Rules of the Supreme Court 1971 (WA), O 36 r 6(2) & (3A).
[30] Appellant's submissions par 9.3 WAB 13.
[31] Lovell v Lovell [1950] HCA 52; (1950) 81 CLR 513, 519; Gronow v Gronow [1979] HCA 63; (1979) 144 CLR 513, 534 - 535; Mallet v Mallet [1984] HCA 21; (1984) 156 CLR 605, 614. See also Porter Street Investments Pty Ltd v Nellbar Pty Ltd [2022] WASCA 33 [112] ‑ [113].
[33] Durolek v Pier (WA) Pty Ltd [No 2] [107].
[34] Brocx v Hughes [2010] WASCA 57 [80].
(1984) 156 CLR 605
(1936) 55 CLR 499
(2011) 80 NSWLR 335
(1988) 165 CLR 268
(1989) 2 WAR 381
(1950) 81 CLR 513
(1979) 144 CLR 513