By Interlocutory Process filed on 5 July 2015 the Plaintiffs, Mr Michael Ghougassian and Dr Daniel Ghougassian, apply for leave to file an affidavit of Mr Michael Ghougassian dated 29 June 2015 and an affidavit of Dr Daniel Ghougassian also dated 29 June 2015, and an order granting leave to re-open their evidence in these proceedings.
An application was not made in that Interlocutory Process for an adjournment of the proceedings, which are presently listed for closing submissions on 14 July 2015, in circumstances that both parties have lodged written outlines of their closing submissions and schedules of evidence pursuant to a direction made by the Court to which I will refer below. However, it was plain that the application which was made by Mr Ghougassian and Dr Ghougassian would in fact require an adjournment of the proceedings, and Mr Balzola, who appeared for them, made an oral application, in the course of submissions before me, for a three month adjournment to make certain further inquiries to which I will refer below. That would have the result that, rather than the proceedings going to closing submissions on 14 July 2014, some further steps would have to occur, likely involving a further hearing, further evidence and further cross-examination in October 2015, before closing submissions could be heard.
It is necessary to refer to how the application arose, and then to the history of the proceedings, before returning to the applicable legal principles. The proceedings had a long history, involving a significant number of directions, before they reached a hearing which took place before me on 4-6 March 2015, then 7-10 April and 24 April 2015 with closing submissions, as I noted above, presently scheduled to take place on 14 July 2015.
The present application arose because, on 29 June 2015, the Plaintiffs' solicitor sent an email to my Associate which enclosed an affidavit of Mr Michael Ghougassian, which was described as the first of the Plaintiffs' affidavits in answer to Order 1 made by the Court on 24 April 2015, and then sent a second affidavit of Dr Daniel Ghougassian, apparently also on the same basis. I restored the matter to the list for directions, because it did not seem to me that, subject to hearing from the parties, the direction that I made on 24 April 2015 permitted the filing of further affidavits.
That direction provided for the parties to serve:
"A schedule identifying all facts, matters and circumstances on which the [parties] rely to support or contest each proof of debt and each claim relied on by the liquidator by way of set-off or cross-claim, that is pressed, identifying all affidavit evidence by paragraph number or documentary evidence (by Court Book page number or exhibit number and page number) and all evidence relied upon."
That direction seemed to me to be directed to a schedule referring to the evidence that had previously been led in the proceedings, and did not invite either or both parties to serve new affidavits after the Plaintiffs had closed their case (T377). It seems to me that that direction had been understood by the parties, since Mr King, Counsel who appeared for the Plaintiffs at the hearing had recognised, on the last day of the hearing, that the schedule contemplated was a "sort of Scott Schedule" and I had then observed that was a helpful analogy. The Plaintiffs had in fact served their submission, and a schedule of that character, although they had done so late, on 18 June 2015, well before the further affidavits were sent to my Associate.
When the matter was re-listed on 3 June 2015, I made orders, for reasons set out in ex tempore judgment, reflecting the fact that the affidavits had been filed in breach of earlier orders that no further affidavits be filed without leave and after the Plaintiffs had closed their case, so that they could not be relied upon without leave for the Plaintiffs to re-open the case. I ordered that, relevantly, the two affidavits be removed from the Court file, but also granted leave to the Plaintiffs to file and serve any application for leave to file such affidavits and re-open their evidence at the hearing, which would then regularise the position, following a hearing of the application on its merits. The Interlocutory Process which was subsequently brought by the Plaintiffs reflected that order, and was supported by evidence filed by the Plaintiffs' solicitor, and in turn opposed by the liquidator on the basis of evidence filed by his solicitor. I heard submissions as to the matter on 9 July 2015.
The Plaintiffs rely, in support of the application, on Mr Balzola's affidavit dated 8 July 2015. Mr Balzola refers, first, to a contention that the Cross-Claim brought by the liquidator pleads fraud or deceit. This contention has generated a degree of confusion, possibly because it was put in a manner that did not identify which part of the Cross-Claim is alleged to plead such fraud or deceit. There had been debate before me on 5 March 2015, in the course of the hearing, as to whether paragraph 78 of the Further Amended Cross-Claim and certain paragraphs of the Amended Points of Defence (which are not presently relevant), should be struck out on the basis that they involved allegations of fraud that had not been properly pleaded.
In submissions before me as to paragraph 78 of the Cross-Claim, Ms Taylor, who appeared for the liquidator, had made clear that that paragraph was not a claim in fraud or deceit, but a claim in restitution, debt, or on the basis of the rule in Cherry v Boultbee (1838) 9 LJ Ch 118; 41 ER 171. On 5 March 2015, I had delivered judgment dealing with the application to strike out that paragraph of the Amended Cross-Claim, and held that I should not do so, on the basis that that paragraph did not involve an allegation of fraud or deceit, for reasons consistent with those which Ms Taylor had put.
There was, however, at least one other paragraph in the Defendant's Cross-Claim that has at all relevant times included a claim for fraud or deceit, and which has never been the subject of challenge before me on the basis that it was not properly pleaded or particularised. Paragraph 65 of the Cross-Claim expressly pleads fraud and deceit on the part of Mr Michael Ghougassian, on the basis that descriptions of certain payments made to him concealed the true nature of the payments and how they had been made. That allegation may ultimately be good or bad on its merits, which will be a matter to be determined in a substantive judgment, but the form in which it has been pleaded has never been controversial.
Returning to Mr Balzola's affidavit, he refers to evidence given by the liquidator in cross-examination on the eighth day of the hearing, 24 April 2015, after Mr King put to him a proposition that he made allegations of fraud. The liquidator had accepted that proposition, although going on to confirm that he would need to check with his lawyer what the pleadings were. I interpolate that Mr Balzola, in the course of submissions before me, drew attention to the quasi-judicial role of a liquidator in dealing with proofs of debt. While that characterisation of a liquidator's role is well established in the case law, it remains that liquidators are often not legally trained, and it was not surprising that the liquidator should consider that matters such as the scope of the pleadings were properly matters of a legal character, for his legal advisers to address.
It seems to me that, first, whether the liquidator's answer that matters of fraud were raised was correct or not depended on which paragraph of the Cross-Claim the question was directed to, a matter which Mr King had not made clear in his question. If it was directed to the paragraph that had been in issue before me on 5 March, namely, paragraph 78 of the Further Amended Cross-Claim, then the liquidator's concession would be incorrect. If it was directed to paragraph 65 of the Cross-Claim, it would plainly be correct. In any event, it seems to me that the liquidator's answer in cross-examination raised no new issue. The pleadings remained as they had always been, the liquidator had not sought to amend them, and his acceptance of Mr King's characterisation of the pleadings took the question of what was in fact in issue in the proceedings no further, because that matter would be determined by the pleadings, not by Mr King's characterisation of them in cross-examination or the liquidator's acceptance of that characterisation.
Next, Mr Balzola's affidavit refers to the necessity to provide a response to questions put by Mr Ghougassian and to Dr Ghougassian in cross-examination, and treats their affidavits as constituting such a response. It seems to me that that approach misunderstands the function of cross-examination, which is to obtain answers to questions put by a cross-examiner, which would be understood together with all the evidence in the proceedings, including the Plaintiffs' evidence-in-chief. It does not seem to me that, in the ordinary course, a witness could necessarily be expected to give a complete account of relevant events in answers in cross-examination, not least because he or she will have had the opportunity to do so in evidence-in-chief, or that there should be a general process by which witnesses may supplement their answers in cross-examination, by then leading further evidence to expand them, particularly if that evidence could have been led in chief.
Mr Balzola also suggests that he had in some way understood the liquidator's answer in cross-examination to have superseded the Court's earlier order. I can address that proposition briefly, because the liquidator did not have power to, and did not purport to, vary the Court's orders, which were a matter for the Court.
Mr Balzola's affidavit also refers to correspondence by which Messrs Ghougassian had sought access to a large number of boxes held in storage at Castle Hill relating to the liquidation of the School or, more precisely, its history prior to its liquidation. I will refer below to further evidence led by the liquidator's solicitors in respect of that matter below. I had made orders, during the course of the hearing, for documents held by the liquidator to be made available for inspection, and that the documents which were the subject of that order had in fact been made available for inspection. It had never been suggested that that order extended, or should extend, to the very large quantity of boxes held in storage at Castle Hill, not least because the liquidator's position has been, consistently throughout the hearing, that his understanding is that those boxes do not contain relevant financial information of the school.
Sometime later, Messrs Ghougassian's solicitor sought to make arrangements for inspection of boxes held at Castle Hill, and it appears that Mr Michael Ghougassian and his wife examined the relevant boxes although, it appears, they have not opened them, by reason of the number of boxes held there. No explanation was given in Mr Balzola's affidavit of why the Plaintiffs had not previously taken steps to inspect those boxes, and that question becomes all the more significant when I refer to the history of offers to allow access to those boxes below. Mr Balzola says, not surprisingly, that he anticipates it will take considerably more than a few days to examine the boxes, where it is common ground that there are hundreds of boxes held at Castle Hill, and Mr Balzola's, or the Messrs Ghougassian's estimate, is that there may be a thousand boxes held there. However, that assessment begs the question why the inspection of those boxes has not occurred in the several years or so that it has taken these proceedings to reach a hearing, after lodgement of the proofs of debt which they challenge.
The liquidator in turn relies on the affidavit of his solicitor, Mr Hegarty, who points to the history of the directions made in the proceedings, to which I will refer further below. Mr Hegarty also notes that the liquidator has complied with the Court's direction to file its submissions in chief and its schedule of evidence, and that he had been given no indication by the Plaintiffs at that time that they would seek to lead the further evidence which they now seek to lead, or that they would seek to re-open their case. Mr Hegarty submitted, in oral submissions, that the costs of preparation of those submissions and schedules would have been significant, and I accept that proposition, where this is a case of considerable complexity.
Mr Hegarty also referred to several forms of prejudice which the liquidator considers he will suffer from further evidence now being led, and the re-opening of the plaintiffs' evidence. First, Mr Hegarty notes that Mr Michael Ghougassian's affidavit deals with third party dealings with persons who have not previously been in issue in the proceedings, and that the liquidator has had no opportunity to investigate those dealings, or seek production of documents so far as they relate to dealings with other banks. Second, Counsel who was retained by the liquidator at the hearing has indicated that she would have cross-examined differently if evidence had been led in the form that is now sought to be led. That is a matter of significance, because the prejudice to the liquidator of having conducted cross-examination on that basis cannot now be undone. Third, Mr Hegarty points to the need for further cross-examination, if the further affidavits are permitted and the proceeding is now adjourned, which is likely to cause particular prejudice to the liquidator, where Counsel who was retained in the proceedings is now on maternity leave, although she will make herself available for the day allocated for closing submissions. Fourth, Mr Hegarty points out that, even if an order for costs thrown away was made, it would not extend to the costs of the liquidator and his staff that would be wasted, which would in turn be borne by the School's creditors, or alternatively those who would benefit on a distribution of any surplus of the School's assets.
Mr Hegarty also leads evidence as to the history of access to the boxes held at Castle Hill, to which Mr Balzola had referred. He confirms the liquidator's understanding that those boxes do not contain financial records of the School, but instead matters such as library books, computer equipment, religious items, school reports and similar materials, and he also refers to the fact that financial records have previously been made available for inspection pursuant to the Court's orders made in March 2015. Mr Hegarty also refers, of equal significance, to correspondence dating back to mid-2012 in which the Plaintiffs had been offered the opportunity to inspect the boxes at Castle Hill. It appears that, as long ago as June 2012, the Plaintiffs' then solicitor had made enquiries as to inspection of those boxes and, in June 2012, it appears the Plaintiffs' then legal representative did attend to inspect those boxes, although it does not appear that he was then looking to identify financial records.
In September 2012, Mr Ghougassian's solicitors had requested the liquidator to allow six months for inspection of the documents before proofs of debt were settled, and the liquidator had allowed one month at that time and had also offered to retrieve boxes from Castle Hill for inspection by Messrs Ghougassian, as identified from the box lists. The six months then nominated for inspection of the boxes, nearly three years ago, has something of an echo of the three months now sought to inspect the boxes, some three years later. There is further correspondence in January 2013 when Messrs Ghougassian were again offered access to the Castle Hill facility, at this point, apparently, to retrieve computer equipment. That correspondence makes clear that there had been no obstacle, over that long period, to Messrs Ghougassian accessing the relevant boxes, and that could have been done in the period since the proofs of debt were lodged and in the long period of directions before these proceedings reached a hearing. There is no adequate explanation in Mr Balzola's evidence of why that did not occur.
I should now turn to the history of the directions made in the proceedings, and the affidavits of Mr Michael Ghougassian and Dr Daniel Ghougassian which have already been read in the proceedings, and the content of the new affidavits sought to be read in them, before returning to the questions whether leave to re-open should be given, whether leave to file the affidavits should be given, and whether there should be a consequential adjournment.
It is important to recognise that the Court has made many directions for the filing of evidence-in-chief by the plaintiffs in these proceedings. Some, but not all of those directions, are referred to in Mr Hegarty's affidavit. In February 2014, the Plaintiffs were directed to file and serve any evidence on which they relied by 24 February 2014. On 7 March 2014, the time for them to do was extended, by consent to 14 March 2014. On 28 April 2014, the time for them to do so was further extended by consent, to 9 May 2014, and an order was made that the Plaintiffs not be entitled to rely on any affidavit evidence-in-chief after that date. That was not, however, as it would often be, the end of the opportunities given for the Plaintiffs to lead further evidence. On 13 October 2014, a further order was made permitting the Plaintiffs to serve any evidence on which they relied no later than 3 November 2014, and that order was extended, on 10 November 2014, to permit them to file such evidence by 1 December 2014, again on the basis that no further evidence would be led by them after that date without leave.
Objection was then taken to a number of the Plaintiffs' affidavits at the hearing on the basis of form, and, on 4 March 2015, I allowed the Plaintiffs to serve further affidavit evidence in order to address issues as to which objection had been taken by reason of form. After the hearing had continued for several days, I made further orders on 6 March 2015 allowing the Plaintiffs to serve any additional documentary evidence, any additional affidavit evidence arising by reason of an Amended Defence or Further Amended Cross-Claim filed by the Defendants, any additional evidence which was before White J in the 2012 proceedings and any other material on which they sought leave to rely, on the basis that no evidence was to be led after 20 March 2015 without leave.
I in turn set out the history of the orders that had been made for the service of evidence in a judgment delivered on 7 April 2015, in the course of the hearing before me, and noted the previous orders that no evidence should be led after the specified dates without leave, and then referred to the applications of ss 56 - 58 of the Civil Procedure Act and the difficulties that would arise if Mr Ghougassian were then permitted to file further evidence of dealings with third parties without notice having been given to the liquidator, so as to deprive the liquidator of an opportunity to make proper inquiry about those dealings. I declined, at that point, to grant leave to Mr Ghougassian to lead such further evidence by way of adopting a handwritten statement.
It seems to me, that on any view, the history set out above contains very comprehensive opportunities for over fifteen months, for the Plaintiffs to lead evidence in the course of these proceedings. The Plaintiffs have in turn taken advantage of those opportunities to lead evidence in the proceedings by relying on multiple affidavits, including affidavits previously read in the earlier proceedings before White J in 2012, including Mr Ghougassian's affidavits dated 12 April and 14 June 2011 in the 2012 proceedings, and affidavits sworn 14 March 2014, 12 November 2014 and 20 March 2015 in these proceedings and Dr Ghougassian's affidavits sworn 12 April 2011 and 8 June 2011 in the 2012 proceedings and his affidavits sworn 14 March 2014 and 20 March 2015 in these proceedings.
With that background, I turn to the content of Mr Ghougassian's further affidavit dated 29 June 2015, which raises numerous factual allegations, including, variously:
(1) declarations as to various matters, such as that he funded the purchase of land acquired by the school in 1984;
(2) further evidence of dealings with property including how loans were made to the school;
(3) a claim that solicitors acting for him, in 1986, had a fundamental conflict of interest and that the monies he paid to a third party should have been reflected by a mortgage in his favour, and contesting the authenticity of his signature on a mortgage instrument which appears to bear that signature;
(4) that his monies rather than a third party lender's monies were used to pay out Mr Evenion;
(5) that he maintains that a registered mortgage and transfer of mortgage should have been registered in his favour from 1987;
(6) that the proceeds of sale of a property which were placed in trust with a firm of solicitors were then dispersed, in part, to a priest with the Armenian Catholic Church towards the purchase price of a property in 1988 and Mr Ghougassian took out a bank loan in respect of that property, and the relevant monies were held on trust and were to be used "as his sole and principal place of residency" [sic];
(7) that Mr Ghougassian was influenced by the solicitor and the Church to place the property in the name of the School although it has had no School function and that he should have been advised of some matters and was misled as to others;
(8) that the School used monies loaned by him to purchase the property, but he had rights as against the School; and
(9) that he had advanced close to $10 million to the School and that the amount of $1 million that White J held was secured, and the failure to secure the larger amount was an "unfortunate oversight".
It is sufficient simply to identify these matters to demonstrate the extent to which the issues in these proceedings would be expanded, potentially well beyond the matters pleaded in them, by the further evidence sought to be led by Mr Ghougassian. The extent of that expansion is all the more striking, after the multiple opportunities that had been given to file and serve affidavit evidence previously, where Mr Ghougassian has now been cross-examined; and where the Plaintiffs had closed their case, and where matters are now listed for final submissions, early next week, on a date that has been allocated for a considerable period.
On 30 June 2015, the Plaintiffs in turn sought to file Dr Ghougassian's further affidavit dated 29 June 2015, which annexes nearly one hundred and seventy pages of annexures. That affidavit in turn refers to the inspection of documents in the course of proceedings which Dr Ghougassian says has "rekindled" his memory as to other matters, and to steps that had been taken from 24 April 2015, the date on which the Plaintiffs had closed their case, to assemble further evidence. Dr Ghougassian in turn refers to other steps taken to assemble further proofs of debt, which are not the subject of these proceedings, and as to which I need not comment. Dr Ghougassian also seeks to lead further evidence as to various financial transactions, which he suggests would be validated as further information became available. That affidavit in turn seems to contemplate an ongoing process where, notwithstanding the closure of the Plaintiffs' case, it will continue to be developed in the period for which a further adjournment is sought.
I turn now to the question of whether I should grant leave to reopen the plaintiffs' evidence. If I am not satisfied that I should grant leave to reopen the evidence, then there would be no purpose in granting leave to file the further affidavits, because they could not be read. In Urban Transport Authority of NSW v Nweiser (1982) 28 NSWLR 471 at 478, Clarke JA (with whom Mahoney and Meagher JJA agreed) pointed to the relevance, in an application to reopen, of the question whether the interests of justice are better served by allowing or rejecting the application. His Honour observed that:
"The principle which would guide the Court in determining whether to grant an application for leave to reopen is whether the interests of justice are better served by allowing or rejecting the application as the case may be. No doubt it is relevant to take account of a number of matters such as likely prejudice to the party resisting the application and the reasons why the evidence is not led in the first place."
In Jesseron Holdings Pty Limited v The Middle East Trading Consultants Pty Ltd (No 2) (1994) 122 ALR 717, Young J, (as his Honour then was) referred to Urban Transit Authority (NSW) v Nweiser above and noted that the test for leave to reopen at the final address stage was what was just in that situation, and would normally be close to that applied on appeal. His Honour allowed reopening in the facts of that case. In Australian Securities and Investments Commission v Rich [2006] NSWSC 826; 235 ALR 587 at [18], Austin J in turn pointed to matters relevant to an application to reopen including the nature of the proceeding, whether the occasion for calling the further evidence ought reasonably to have been foreseen, considerations of fairness in respect of the defendant's notice of the case they have to meet, the importance of the issues as to which the further evidence is sought to be adduced to the issues in the case, the degree of relevance and probative value of the further evidence, the prejudice to the defendant in terms of delay and the completion of the proceedings and consequential costs, the public interest in the timely conclusion of the litigation, and the explanation offered by the applicant for not having called the evidence-in-chief. In Gaskin v Ollerenshaw [2010] NSWSC 788, Garling J provides a helpful summary of these principles. His Honour noted the source of the Court's power to reopen under r 2.1 of the Uniform Civil Procedure Rules 2005 (NSW) or alternatively UCPR 29.5 and also drew attention to the relevance of the question of prejudice to the other party arising from reopening.
In the present case, it seems to me that several factors tend against reopening although I am conscious of one factor which tends in favour. In submissions, Mr Balzola pointed to the significance of the relevant evidence to the Plaintiffs' case. It is possible that the evidence would assist the Plaintiffs in establishing their case so far as particular documents may go to establish particular transactions. That proposition has to be qualified in one respect, because of the difficulty in determining, from the form of the evidence, what part of it relates to the matters presently in issue, and what parts of it relates to matters which are not presently in issue. Some parts of the affidavits are also in declaratory form, which is likely to be inadmissible for the same reasons that previous declarations by the plaintiffs, asserting particular matters, have been inadmissible.
Nonetheless, I proceed on the basis that the Plaintiffs might well advance their case, notwithstanding the extent of the evidence which they have already led, if they are given the opportunity to lead further evidence. On the other hand, it seems to me that there is no real explanation of why this evidence could not have been led previously, given the many opportunities the Plaintiffs have had to lead such evidence; the prejudice to the liquidator in terms of delay in completion of the proceedings and costs is substantial, where an adjournment of at least three months is contemplated, and the liquidator will not be compensated for his and his staff's costs thrown away by reason of that adjournment which will in turn be borne by third parties such as creditors of the School and potential beneficiaries of the distribution of any surplus; and the public interest in the timely conclusion of litigation will plainly not be served by adjourning the proceeding for three months, with a view to recommencing them across a wide range of issues, in respect of evidence, some of which relates to the matters presently in issue and some of which, as Mr Balzola fairly concedes, does not.
For that reason, it seems to me that there are reasons not to grant leave to reopen which overlap with the reasons why the Court should not grant leave to file further affidavit evidence. Those reasons include the fact that that evidence is not in accordance with the earlier directions, now made on many occasions, and including repeated directions that further evidence not be led without leave. The evidence was not permitted by the 24 April order as to a schedule, and it seems to me that it would give rise to a significant prejudice to permit it to be filed, so far as the liquidator is concerned, for the reasons I have already noted.
I am, of course, required to exercise my discretion whether to grant leave to file that further evidence having regard to the provisions of ss 56-58 of the Civil Procedure Act. Section 58 requires the Court to have regard to the dictates of justice when considering such an order and also requires the Court to have regard to the provisions of ss 56 and 57. Section 56, identifies the overriding purpose of the just, quick and cheap resolution of the real issues in dispute in the proceedings and s 57 requires proceedings to be managed, having regard, inter alia to the just determination of the proceedings. In Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175, the joint judgment of the High Court observed in relation to rules of Court that are similar to s 56 of the Civil Procedure Act that:
"Speed and efficiency, in the sense of minimum delay and expense, are seen as essential to a just resolution of proceedings. This should not detract from a proper opportunity being given to the parties to plead their case, but it suggests that limits may be placed upon their pleading, when delay and costs are taken into account. The rules reference to the need to minimise costs implies that an order for costs may not always provide sufficient compensation and therefore achieve a just resolution. It cannot therefore be said that a just resolution requires that a party be permitted to raise any arguable case at any point in the proceedings, on payment of costs."
I pause to note that the observations there made as to amendment of proceedings may equally be made as to the leading of further evidence in them.
The need for the Court to have regard to the prejudice arising from delay has also been emphasised by the Court of Appeal in this State in Bi v Mourad [2010] NSWCA 17. I am conscious that the principles in Aon are, of course, to be applied having regard to the statutory context established by the Civil Procedure Act and particularly the emphasis on the dictates of justice and the need for the just, quick and cheap resolution of the real issues in dispute in the proceedings. However, as Aon demonstrates, the interest of justice are not measured solely by maximising the opportunity to a plaintiff to develop its case, but also include the interests of the other party to the proceedings in having a fair opportunity to meet that case, and having the case determined in a timely way, and the interests of the community in respect of the way in which the public resources devoted to the court system are applied.
In Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230 at [36], Allsop P in turn observed that the relevant provisions bring about:
"A new statutory balance among various factors in litigation including Court and party efficiency and the delivery of individual justice. Delay and case backlog are not merely matters affecting the public costs in delivering justice, they corrode the ability of the Courts to provide individual justice...the reforms that have taken place under the Civil Procedure Act...can thus be seen not merely to reflect worthy governmental and judicial efforts for efficiency, but also to be vital for the provision of timely individual justice. To these salutary ends, the significant powers of case management have been placed in the hands of judicial officers which, if exercised, can often be seen to have sharp, and sometimes detrimental effects on the claims of the parties."
In her later judgment in Cook v O'Neill [2013] NSWSC 1592, Adamson J in turn identified the relevant matters in dealing with an application for leave to rely on a late expert's report, which she declined, including the relevance of exceptional delay, lack of an adequate explanation for the delay, prejudice to the other party, and the importance of the appropriate and efficient allocation of Court resources, not only to particular cases but also to the other cases.
In this case, I am conscious that Mr Balzola draws attention to the High Court authority as to the relevance of pleadings, and the importance of pleadings in giving the other party notice of the case to which they have to meet. I have had regard to that authority. Nonetheless, as I noted above, it seems to me that the case that the Plaintiffs have to meet in the Cross-Claim, has not changed. It remains as it was in on the first day of the hearing, so far as an allegation of fraud is made in one aspect of the case, the pleading of which has never been contested, and not made in other parts of the case. Nothing that the liquidator has said in cross-examination has changed that position. So far as the case in-chief is concerned, that case was, and is, defined by the proofs of debt that were lodged by the Plaintiffs in the first place and as to which they challenge the rejection of their proofs of debt. Nothing has changed in that regard, and the matters in issue in that respect are also as they were on the first day of the hearing.
It seems to me, that, in this case, there has been what can only be described as an exceptional delay in seeking to lead further evidence, and there is no adequate explanation of that delay. In particular, I do not accept the proposition, implicit in Mr Balzola's affidavit and in his submissions, that Mr Ghougassian and Dr Ghougassian should be entitled to continue to lead further evidence as further matters occur to them, as they are cross-examined, so that, after the completion of their substantive cross-examination, the proceedings should then enter another stage where they supplement their answers in cross-examination and raise new issues of which they have been reminded by their cross-examination. It seems to me that there would be substantial prejudice to the liquidator, to which I have referred above, including irremediable prejudice as to the basis on which cross-examination has been conducted, a substantial waste of costs in preparing submissions and a schedule in accordance with the Court orders and without notice of the further evidence now sought to be led, and the delay and costs associated with the substantial further adjournment of at least three months, additional subpoenas and further cross-examination. That, as I have noted, cannot be compensated for an order for costs, which will not compensate for the liquidator's wasted costs, as distinct from legal costs.
As I have noted, I have had regard to the fact that Mr Ghougassian's and Dr Ghougassian's case may be advanced by the further evidence with the qualifications to which I have referred above. I am nonetheless satisfied, having regard to ss 56-60 of the Civil Procedure Act and the need for the just, quick and cheap resolution of the matters in the proceedings, and also having regard to the community's interests in the finality of litigation and in appropriate allocation of Court resources, that the interests of justice would not be served by granting leave to reopen the proceedings, granting leave to lead further evidence in them, or adjourning them now for a further period of three months rather than proceeding to closing submissions in respect of the case as it has been conducted before me.
I am comfortably satisfied that the just, quick and cheap resolution of the real issues in dispute require that I dismiss the Plaintiffs' application. Accordingly, that application is dismissed with costs.
[3]
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: 03 August 2015