Asciak v Jackson [2016] NSWDC 87 | Case summary

Introduction:

"The first duty of every court is to determine whether it has jurisdiction" - see Eberstaller v Poulos [2014] NSWCA 211 per Leeming JA at [1] with whom Beazley P and Meagher JA agreed.
This judgment is principally concerned with whether or not this court has jurisdiction to hear an appeal from a decision of the Local Court sitting in its Small Claims Division on 25 May 2015. But, as I shall reveal, determining the question of jurisdiction necessarily involves the making of findings which determine the appeal.
In this context, section 39 of the Local Court Act 2007 (NSW) relevantly provides: "… (2) A party to proceedings before the [Local] Court sitting in its Small Claims Division who is dissatisfied with a judgment or order of the court may appeal to the District Court, but only on the ground of lack of jurisdiction or denial of procedural fairness." (emphasis added)

Background:

On 13 November 2014 Mr Asciak, who was not legally represented, filed a Statement of Claim in the Armidale Registry of the Local Court. The named defendant was Mr Jackson. The Statement of Claim was endorsed as being brought in the General Division of the court.
The amount formally claimed in the Statement of Claim was $10,000.00 - plus interest and costs, although the actual amount was much less - see [14] below.
Section 29 of the Local Court Act provides that the "jurisdictional limit" for the Local Court is $100,000.00 when sitting in its General Division and $10,000.00 when sitting in its Small Claims Division.
The endorsement on the Statement of Claim ought therefore to have been for the Small Claims Division and not the General Division. Paragraph 14 of the Statement of Claim would suggest that that was the intention of Mr Asciak.
The substance of the Statement of Claim concerned two alleged loans made between Mr Asciak as the lender and Mr Jackson as the borrower.
The first loan was alleged to have been made on 11 February 1999. The principal sum was $25,000.00. The period of the loan was 3 months. The Statement of Claim further alleged that the borrower agreed to reimburse the lender for the lender's costs associated with the obtaining of the principal sum.
Mr Asciak alleged that the principal sum on the first loan was not repaid until 11 September 1999. He sought $2,111.70 as his costs in obtaining that loan.
The second loan was allegedly made on 28 September 1999. It was on the same bases as the first loan, except that the principal sum was $4,000.00.
Mr Asciak alleged that the principal sum in relation to the second loan was not repaid until 21 September 2000. Mr Asciak sought $3,246.98 as his costs of obtaining that second loan.
Although the actions based on the two loans are referred to in the one Statement of Claim they are, in substance, two separate causes of action.
And although the amount formally claimed in the Statement of Claim was $10,000.00, the actual amounts particularised within the Statement of Claim totalled $5,358.68 plus interest.
An action on a debt - which is the nature of each of the causes of action relied upon by Mr Asciak - is subject to a limitation period of 6 years (see section 14 of the Limitation Act 1969 (NSW)).
Subject to what follows, and without the benefit of submissions from the parties, it seems to me that the cause of action in relation to the payment of the costs incurred by Mr Asciak in obtaining the funds for the first loan expired either on 11 May 2005 - being 6 years after the loan was due to be repaid - or 11 September 2005 - being 6 years after the actual repayment of the principal sum.
Similarly, the cause of action in relation to the payment of costs incurred by Mr Asciak in obtaining the funds for the second loan expired either on 28 December 2005 - being 6 years after the loan was due to be repaid - or 21 September 2006 - being 6 years after the actual repayment of the principal sum.
For the purposes of these reasons, it is not necessary to resolve the matters raised in [16] or [17] above.
However, a limitation period fixed under the Limitation Act can be effectively extended if the person against whom the cause of action lies "confirms" that cause of action: see section 54 of the Limitation Act.
Mr Asciak was undoubtedly conscious of both the general limitation period and the notion of confirmation because he pleaded (in paragraph 8 of the Statement of Claim) that a payment by Mr Jackson of $50.00 in February 2004 constituted a confirmation of "the loans" (emphasis added) and (in paragraph 9 of the Statement of Claim) a payment by Mr Jackson of $2,000.00 in November 2008 constituted a further confirmation of "the loans" (emphasis added).
A reference to section 54 of the Limitation Act, however, will reveal that any alleged act of confirmation must be done before the expiration of the relevant limitation period.
Mr Jackson did not file a Defence to the Statement of Claim. Rather, he filed a Notice of Motion dated 2 May 2015 by which he sought to have the proceedings summarily dismissed on the basis that the claims in the Statement of Claim were unarguably statute barred. Alternatively, he sought to have the proceedings dismissed because they had not been pursued with "due despatch".
The Notice of Motion was first returnable before the Local Court on 25 May 2015.
On that return date Stafford LCM did not enquire of Mr Asciak (as is customary) as to whether he wished to file any affidavit or other evidence of his own in answer to the Notice of Motion. Rather, her Honour embarked upon an immediate hearing of the Notice of Motion solely based on the contents of the Statement of Claim.
Very early on in that hearing, the solicitor for Mr Jackson correctly abandoned the alternative claim for relief in the Notice of Motion.
During the hearing of the Notice of Motion it is clear enough that Mr Asciak sought to place various documents into evidence before her Honour but he was unsuccessful in those attempts (see [34] below).
At the conclusion of the interlocutory hearing, Stafford LCM gave an ex tempore judgment in which her Honour concluded that there had been no effective confirmation by Mr Jackson in respect of either loan before the date upon which the Statement of Claim was filed. Her Honour therefore dismissed the Statement of Claim on the basis that Mr Jackson had established that Mr Asciak had no arguable or reasonable cause of action by reason of a limitation issue.
Following her Honour's judgment, Mr Asciak filed a Summons in this court purportedly being an appeal within the meaning of section 39(2) of the Local Court Act.
The Summons was listed for mention before me at the sittings of the court in Armidale on 26 November 2015.
At that mention, the solicitor for Mr Jackson took the point that the court had no jurisdiction to hear the appeal because neither of the two necessary pre-conditions in section 39(2) had been engaged.
At that stage the transcript of the proceedings before Stafford LCM was not available.
I therefore directed the parties to prepare written submissions on the limited question of jurisdiction once that transcript did become available. Both parties agreed that no further oral submissions would be required. Both parties also agreed that this judgment could be made in chambers.
There was a delay in the receipt of the transcript. The parties duly filed their submissions by late February 2016.
In his written submissions, Mr Asciak says that during the hearing of the Notice of Motion before Stafford LCM he tried to bring to the court's attention the following alleged payments made to him by Mr Jackson: 1. 7 June 1999, $6,000.00; 2. 6 September 1999, $1,900.00; 3. 21 September 2000, $4,000.00; 4. 21 February 2004, $50.00; 5. 9 June 2005, $500.00; and 6. 14 November 2008, $2,000.00.
Somewhat unhelpfully, the payments referred to in subparagraphs (a), (b), (c) and (e) were not pleaded by Mr Asciak in the Statement of Claim as acts of confirmation. However, (d) and (f) were so pleaded - and allegedly in relation to "the loans".
If some (at least) of the payments in (a) to (f) above were ultimately held by a court to be acts of confirmation of the causes of action, then the limitation period for those causes of action would not have expired until the close of business on 13 November 2014 - the day on which the Statement of Claim was filed.
In the circumstances I have described, I have concluded that Mr Asciak was denied procedural fairness in the hearing of the Notice of Motion on 25 May 2015 in two respects. First, by not advising him of his right to prepare an affidavit or rely on other evidence in answer to the defendant's on the Notice of Motion and offering Mr Asciak the opportunity of an adjournment to prepare that affidavit or assemble that evidence. Secondly, in not fully considering the implication of the documents which Mr Asciak unsuccessfully sought to put into evidence.
Accordingly, I decline to strike out the Summons on the basis that this court lacks jurisdiction to hear the appeal. I am satisfied that this court does have jurisdiction - and indeed that the appeal is made out.

Asciak v Jackson

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Judgment (4 paragraphs)

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