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[2013] NSWCA 297
respondent. Appeal dismissed with costs.
A self-represented man and his company lost their Supreme Court claim for extra payment for building two houses on a property he used to own. The Court of Appeal ruled the trial judge was fair in refusing to accept a very late detailed costs affidavit and in denying extra time, because the man had deliberately ignored court orders and chose to run the case himself despite warnings. The only agreement that mattered was the written deed saying they would split profits equally after costs; there was no separate right to be paid for his labour on top. Adjustments to the sale money were also upheld. The appeal was dismissed and the man must pay costs.
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The underlying dispute concerned a residential redevelopment project at Canley Vale in western Sydney. Laura Bauskis held title to the property on trust for her father, the first appellant, John Peter Bauskis. In October 2006 the respondent, Nicholas Kon Ming Liew (who had been Mr Bauskis' accountant), purchased the property for the stated contract price of $350,000. Only $186,013.95 was paid to discharge an existing mortgage; the balance of any purchase price was never paid to Laura Bauskis. The parties then entered a formal Deed of Arrangement dated 15 March 2007. The recitals recorded that Mr Bauskis could not raise finance himself and that Mr Liew would redevelop the land into two separate residential lots with new homes for eventual sale. Clause 1 obliged Mr Bauskis to have "the principal management and supervision of the construction of the Development to its completion". Clause 2 provided that the parties would sell the completed development "subject to mutual agreement as to sale prices and to share equally the net profits of such sales after payment of all construction costs, moneys borrowed for the Development, agents' commissions and legal expenses" ([14]).
No linked legislation citations have been extracted yet.
Both kit homes were erected. Mr Bauskis performed substantial physical labour as well as management tasks. The properties were sold. Mr Liew paid the net proceeds of one sale to his bank and paid the balance of the second sale ($204,163.89) into court. In November 2011 Gusfact Trading Pty Ltd (the second appellant, controlled by Mr Bauskis) issued a tax invoice for $300,000 comprising a construction management fee of $258,420 and out-of-pocket expenses of $41,580. Proceedings were commenced in the Common Law Division claiming that sum. The amended statement of claim pleaded the claim as arising "in accordance with the Deed" ([13]).
At trial before Beech-Jones J on 9 and 10 July 2012 Mr Bauskis appeared for himself and Gusfact. On the first morning he sought to tender an affidavit sworn 6 July 2012 that attached a schedule of alleged labour costs totalling $359,520 and expenses of $42,392. That affidavit had been served on the morning of the hearing, almost two months after the April 2012 directions required detailed costings to be provided by 8 May 2012. The respondent objected. After an extended luncheon adjournment during which the primary judge expressly invited Mr Bauskis to consider seeking an adjournment to obtain legal advice, Mr Bauskis elected to proceed. The late affidavit was rejected in an ex tempore judgment ([18]-[31]).
On the second day Mr Bauskis made two further oral applications for adjournment—one based on alleged bias, new evidence, and the need for legal advice on procedure, and a later application after cross-examination to obtain legal representation for the balance of the trial. Both were refused ([32]-[43]). The trial continued. Mr Bauskis' evidence under cross-examination was that the only agreement had been a pre-October 2006 verbal arrangement that Mr Liew would finance the building and Mr Bauskis would repay him at the end; he denied any agreement that Mr Liew would pay him for time and labour. He conceded the $300,000 figure was "made up" and that he had brought no supporting invoices or receipts because "My word is law, bond" ([47]-[55]).
In the principal judgment delivered 26 July 2012 Beech-Jones J held that the Deed was a valid and enforceable joint venture agreement, that Mr Bauskis' management and supervision duties were performed in discharge of cl 1, and that no legal basis existed for any additional recovery for labour or for the management fee. Claims for third-party expenses failed for want of proof. On the purchase-price issue the judge preferred Mr Liew's evidence (given in a verified cross-claim) that the true agreed price was $260,000 rather than the $350,000 stated in the contract, leading to an adjustment of $71,794.10 in Mr Bauskis' favour from the funds in court. Further orders dealing with GST and costs were made on 20 September 2012 after a hearing Mr Bauskis did not attend ([44]-[60]).
Mr Bauskis and Gusfact appealed to the Court of Appeal. The appeal was heard on 7 August 2013. Beazley P and Barrett JA agreed with the lead judgment of Gleeson JA delivered on 5 September 2013. The Court rejected all grounds, holding that the procedural rulings involved no House v The King error, that no denial of procedural fairness had occurred, that the Deed exclusively governed the parties' rights, and that the purchase-price adjustment was open on the evidence. The appeal was dismissed with costs ([115]-[118]).
The Court of Appeal's reasoning rests on three interlocking propositions, each grounded in the transcript, the primary judge's ex tempore rulings, and the principal judgment.
First, the duty owed to self-represented litigants is limited. Gleeson JA extracted four propositions from Hamod v State of New South Wales [2011] NSWCA 375 and the authorities collected there ([66]-[70]). The court must give sufficient information about practice and procedure to ensure a fair trial for both sides, but must not give judicial advice, run the case, or confer special advantage. An unrepresented party remains bound by the rules. The transcript showed that Beech-Jones J had repeatedly warned Mr Bauskis of the likely rejection of the late affidavit, had given him an extended opportunity over lunch to consider obtaining legal advice, and had explained that he was running "a legal case" ([22]-[24]). Mr Bauskis had responded that the case was "straightforward", that he was using "common sense", and that he chose "on my own free will to do it myself" ([22]). Having made that conscious election, he could not later complain that the judge should have rescued him from the consequences of non-compliance.
Second, the discretionary decisions to reject the affidavit and refuse the adjournments were open and involved no House v The King error. The lateness was not inadvertent; Mr Bauskis had written on 2 May 2012 that he would not supply the costings until two weeks before the hearing because he wanted the respondent's builder to produce an independent quote rather than "manipulate" his own figures ([21]). The primary judge characterised this as a party who "knew of a court order; thought he knew better; decided not to comply with it and then complied with it late" (ex tempore reasons at [11], quoted at [27]). Allowing the affidavit without an adjournment would have prejudiced Mr Liew; granting an adjournment would have rewarded the brinkmanship. On the adjournment applications the judge noted that Mr Bauskis had run "20-odd" cases, had tried to "indict two judges", and could point to no specific procedural uncertainty or any approached witness ([36]). The further adjournment application after cross-examination was refused because nothing material had changed since the previous day's warning ([41]-[42]). Gleeson JA held that these assessments were consistent with the principles in Sali v SPC Ltd, Aon Risk Services, and Newton v Ellis; appellate intervention in interlocutory case-management decisions is rare and was not warranted here ([71]-[86]).
Third, the substantive claim failed because the Deed covered the field. Mr Bauskis' own evidence under cross-examination was fundamentally inconsistent with any entitlement to be paid for labour: he described a pre-Deed verbal arrangement under which Mr Liew would finance the project and be repaid at the end, with no mention of profit-sharing or payment for time ([47]-[48], [95]). That evidence could not support a quantum meruit claim, whether contractual or restitutionary; Nikolic v Oladaily Pty Ltd was cited for the proposition that a valid contract prevents a restitutionary claim that would subvert the contractual risk allocation ([93]). Management and supervision were expressly required by cl 1; the consideration for that work was the equal profit share in cl 2. The $300,000 invoice was unsupported by documents and the round figure was admitted to be "made up" ([54]). On the purchase-price issue, although neither party was cross-examined, the verified pleadings placed competing versions before the court. Given the primary judge's adverse credibility findings against Mr Bauskis, it was open to accept Mr Liew's evidence that the true agreed price was $260,000, which better accorded with the financing actually raised ([112]-[113]).
Barrett JA added a discrete rebuke: counsel's suggestion that the trial judge had "lost his cool" was baseless. The two transcript pages relied upon showed only patience and repeated attempts to elicit the nature of the "new evidence" ([3]-[7]).
Prior to Bauskis v Liew the law on assistance to self-represented litigants was already well developed. Hamod v State of New South Wales [2011] NSWCA 375 (itself drawing on Tomasevic v Travaglini, Abram v Bank of New Zealand, and Rajski v Scitec) had synthesised the principles: the judge must ensure a fair trial without descending into the arena or advising on tactics. Aon Risk Services had emphasised that adjournments must now be weighed against the prejudice to other litigants and the efficient use of court resources, qualifying the earlier approach in State of Queensland v JL Holdings. The limits on quantum meruit where a contract covers the field had been stated in Nikolic. The significance of failure to cross-examine was settled by Seymour v ABC and Knight v Maclean.
Bauskis did not change these doctrines. It applied them to a concrete factual matrix involving deliberate non-compliance, a litigant with considerable litigation experience, and a claim that shifted shape from pleading through trial to appeal. The decision reinforced that self-represented status does not excuse non-compliance chosen as a forensic tactic, and that a joint-venture deed allocating risk by profit share precludes separate remuneration claims for work within the scope of the deed. The purchase-price analysis illustrated that verified pleadings can constitute evidence capable of being preferred on credibility grounds even without cross-examination.
After the decision, the legal landscape for self-represented litigants in New South Wales remained one of balanced fairness rather than affirmative assistance. Trial judges continue to be expected to explain procedure but not to cure deliberate forensic choices. The case is routinely cited for the proposition that a self-represented litigant's "brinkmanship" with directions will weigh heavily against procedural indulgences.
Paragraph [6] (Barrett JA): "Nothing in those parts or elsewhere in the extract I have set out justified an invitation to this Court to infer that the primary judge was 'getting perhaps a little anxious' or was 'irritated' or 'probably understandably lost his cool'. To the contrary, that material shows that the judge conducted himself with decorum and patience and in a way calculated to ensure full and fair consideration of the adjournment application with which he was dealing."
Plain English: The transcript does not show a judge losing his temper; it shows a judge patiently trying to find out what the new evidence was. The criticism of the trial judge was unfair and should never have been made.
Paragraph [67] (Gleeson JA): "First, the Court's obligation in the case of a self-represented litigant is to give sufficient information as to the practice and procedure of the Court to ensure that there is a fair trial to both parties. The application of this principle will vary depending upon the circumstances of the case."
Plain English: The judge must tell an unrepresented person enough about how the court works so that both sides get a fair hearing. How much help is given depends on the case; it is not a blank cheque.
Paragraph [70] (Gleeson JA): "Fourthly, the trial judge must remain at all times the impartial adjudicator of the matter, measured against the touchstone of fairness. In this regard, an unrepresented party is as much subject to the rules as any other litigant: Rajski v Scitec Corporation Pty Ltd ... per Samuels JA at 14."
Plain English: The judge must stay neutral. Being unrepresented does not let you break the rules that everyone else must follow.
Paragraph [80] (Gleeson JA): "Mr Bauskis was granted sufficient time over the extended luncheon adjournment to consider his position. Upon the resumption of the hearing, Mr Bauskis indicated that he wanted to proceed without legal representation. That was his entitlement, but this did not mean he was not required to comply with the Court's earlier directions."
Plain English: The judge gave him extra time to decide whether to get a lawyer. He chose not to. He was allowed to represent himself, but he still had to obey the orders the court had already made.
Paragraph [93] (Gleeson JA), citing Nikolic: "The contractual allocation of risk cannot be subverted by alleging a cause of action stemming from unjust enrichment covering the same conduct."
Plain English: If you have a written contract that sets out who bears what risk, you cannot later say "it's unfair—pay me anyway" using a restitution claim that covers the same work.
Paragraph [109] (Gleeson JA): "The prima facie position is that a court will accept the unchallenged evidence of a witness. This is on the principle that the party who fails to cross-examine a witness is taken to have accepted that evidence..."
Plain English: If you do not cross-examine someone on a point, the court will usually treat their evidence on that point as accepted—unless the evidence is unbelievable or contradicted by other solid material.
Bauskis will be cited where a self-represented litigant seeks an adjournment or leave to rely on late evidence after having deliberately ignored earlier directions. The trigger facts are: (1) clear pre-trial orders requiring particular evidence by a fixed date; (2) a letter or statement indicating the litigant is withholding material for tactical reasons; (3) an express judicial warning, accompanied by time to consider obtaining legal advice; (4) a conscious election to proceed; and (5) an inability on the adjourned date to identify any specific prejudice or new witness who has actually been approached. In such circumstances the case stands for the proposition that no House v The King error or denial of procedural fairness will be found.
The substantive holding applies to any joint-venture or building case in which the parties have executed a deed that allocates risk by profit share and assigns management/supervision responsibilities to one party. A subsequent claim for a fixed management fee or labour cost calculated on a time-and-materials basis will fail if it is inconsistent with the deed and unsupported by contemporaneous documents. The case is also authority that, where both parties have placed competing versions of an oral agreement into evidence by verified pleading, a trial judge may resolve the conflict on credibility and inherent probability even if neither side cross-examined on the point, provided the judge explains the reasoning.
Although the judgment itself is the source text, it expressly applies and approves a line of authority that subsequent courts have continued to follow. Gleeson JA's synthesis at [66]-[70] of the Hamod principles has been treated as an authoritative restatement. The emphasis on conscious election to proceed unrepresented despite judicial invitation to seek an adjournment has been applied to refuse later applications for indulgence. The rebuke at [7] concerning unfounded attacks on a trial judge's demeanour has reinforced the expectation that counsel will have a proper factual foundation before making such submissions.
The substantive contractual analysis has been cited for the proposition that a deed providing for equal profit share in a development venture precludes a separate quantum meruit claim for the very work contemplated by the deed. Courts have followed the approach to verified pleadings as evidence capable of being preferred on credibility grounds in the absence of cross-examination, citing the reference to HSH Hotels and Seymour v ABC at [109]-[111].
The decision has been treated as confirming that Aon Risk Services principles apply with full force to applications made by self-represented litigants; case-management prejudice to the respondent and to the court list remain powerful considerations even where an unrepresented party claims to be "out of their depth".
The judgment leaves open what degree of judicial intervention is required when a self-represented litigant, unlike Mr Bauskis, can point to a specific, identified procedural rule of which he or she is genuinely ignorant and which is not obvious to a layperson. The Court noted that Mr Bauskis had run many cases and had attempted to "indict two judges"; it is unclear whether a first-time litigant who expresses genuine puzzlement would trigger a greater explanatory obligation.
It also leaves open the precise boundary between work that falls within cl 1-style "management and supervision" (remunerated by profit share) and work that might, in a differently worded deed, be regarded as additional construction labour attracting separate remuneration. The Court did "not necessarily accept that Mr Bauskis' work in erecting the kit homes went beyond the performance of that obligation" ([51]), but did not lay down a bright-line test.
The interaction between verified pleadings and the rule in Browne v Dunn is not fully explored. Although both parties tendered verified pleadings containing inconsistent purchase-price allegations and neither cross-examined, the Court accepted that the primary judge could prefer one version on credibility. Whether that approach survives where the pleadings are the only evidence on a critical integer remains for future cases.
Finally, the Court did not decide whether a restitutionary quantum meruit claim could ever succeed where the deed is found to be void or unenforceable. Mr Bauskis asserted the Deed was "illegal" but the primary judge rejected that contention on the basis that both parties were literate adults who intended to create legal relations ([45]). The outer limits of the Nikolic principle in joint-venture cases where the deed fails for some other reason therefore remain open.
Judgment 1BEAZLEY P: I have had the advantage of reading in draft the judgment of Gleeson JA. I agree with his Honour's reasons and with the Orders he proposes. 2BARRETT JA: I agree with Gleeson JA. The orders his Honour proposes should be made for the reasons he gives. 3Particular reference should, however, be made to a submission put by counsel for the appellants to this Court, namely, that the primary judge, in dealing with Mr Bauskis, was, at certain points, "getting perhaps a little anxious", was "irritated" and "probably understandably lost his cool". 4Counsel who made that submission in this Court was not present during the trial and had no first hand knowledge of what transpired there. When pressed by the Bench for the basis for his submission about the judge's attitude or frame of mind, counsel referred to two particular pages of the transcript. I set out in full the content of those two pages: "HIS HONOUR: Yesterday there was a tender of two disks which I have had printed out. I neglected to mark them. They will be marked as exhibit 1. EXHIBIT #1 TWO DISKS TENDERED, ADMITTED HIS HONOUR: Mr Bauskis, could you come back into the witness box? PLAINTIFF: I am asking for an adjournment because of the bias in this court and I have new evidence which I need to seek legal advice on anyway. So I ask for an adjournment of at least a week or two weeks. HIS HONOUR: All right. Well, let's find out a bit more about this. What are the reasons for the adjournment? PLAINTIFF: New evidence. HIS HONOUR: All right. What's that? PLAINTIFF: And your bias. HIS HONOUR: Right. PLAINTIFF: And I need legal advice. HIS HONOUR: What's the bias on my part that you seek to bring new evidence. PLAINTIFF: Bias - that's one of the reasons. HIS HONOUR: What are the others? PLAINTIFF: New evidence. HIS HONOUR: What's the new evidence? PLAINTIFF: I need to seek legal advice. HIS HONOUR: What is the new evidence? PLAINTIFF: I have found new evidence but I have to back it up with laws and I have to find the laws. HIS HONOUR: Tell me what the new evidence is. What is it? What is the evidence? PLAINTIFF: There's laws that I have to find from the records cases that I can back up these laws. HIS HONOUR: Right. So what you mean is the opportunity to do some legal research? PLAINTIFF: That's correct. HIS HONOUR: About what? PLAINTIFF: About these two bits of evidence that I have got. HIS HONOUR: What are the two bits of evidence? PLAINTIFF: I don't wish to divulge that at this stage. HIS HONOUR: If you don't tell me, you can't have an adjournment. PLAINTIFF: What, you're threatening me now because I won't tell you something. HIS HONOUR: I'm not threatening you - you cannot expect to get an adjournment based on new evidence unless you tell me what the evidence is. PLAINTIFF: My main reason is bias because you're totally biased against me. HIS HONOUR: You have said that. I am asking you now about what the new evidence- PLAINTIFF: I don't want to be confronted here in a kangaroo court. I have put in a complaint against you in the judicial offices. HIS HONOUR: I am going to ask you for the third time about your new evidence, which is one of the reasons you say you want an adjournment. I am asking you for the third time and I will give you the opportunity to tell me what the new evidence is. PLAINTIFF: It's a law that I have to research which basically states that I have got to be - I am entitled to be paid for work done and the other one is in the Crimes Act regarding slavery." 5While basing his submission on the whole of this material, counsel for the appellants made particular reference to two parts: the part near the beginning starting, "PLAINTIFF: I am asking for an adjournment . . ."; and the part towards the end commencing, "HIS HONOUR: I am going to ask you for the third time . . .". 6Nothing in those parts or elsewhere in the extract I have set out justified an invitation to this Court to infer that the primary judge was "getting perhaps a little anxious" or was "irritated" or "probably understandably lost his cool". To the contrary, that material shows that the judge conducted himself with decorum and patience and in a way calculated to ensure full and fair consideration of the adjournment application with which he was dealing. 7The submission that the judge was "getting perhaps a little anxious", was "irritated" and "probably understandably lost his cool" lacked foundation. It should not have been made. 8GLEESON JA: This is an appeal from a decision of Beech-Jones J, given in the Common Law division of the Court, dismissing the appellants' amended statement of claim which sought judgment against the respondent in the sum of $300,000. His Honour otherwise determined the entitlement of the first appellant (Mr Bauskis) and the respondent (Mr Liew) to moneys which had been paid into court by Mr Liew from the proceeds of sale of a property at Canley Vale, totalling $204,163.89: Bauskis and Anor v Liew (No 2) [2012] NSWSC 1148. 9Mr Bauskis was unrepresented at the trial and appeared for himself and the second plaintiff, Gusfact Trading Pty Ltd (Gusfact), of which he was the principal. The defendant, Mr Liew, was Mr Bauskis' accountant for at least part of the time when the events giving rise to the dispute between the parties occurred. 10This appeal concerns whether, as a self-represented litigant, Mr Bauskis was denied procedural fairness as a consequence of various procedural rulings by the primary judge in rejecting parts of the plaintiffs' evidence and in refusing the plaintiffs' applications for an adjournment of the hearing. 11The appeal also concerns the nature of the arrangements between Mr Bauskis and Mr Liew in developing the Canley Vale property, which was subdivided into two lots with a new home built on each lot and ultimately sold by Mr Liew. In particular, the question for determination is whether Mr Bauskis' rights are limited to an equal share of the net profits of the development as provided under a Deed of Arrangement between Mr Bauskis and Mr Liew dated 15 March 2007 (the Deed), or whether Mr Bauskis may also maintain a claim in debt against Mr Liew for work and labour done in respect of the development. 12For the reasons set out below, the challenges to the primary judge's procedural rulings and substantive decision fail, and the appeal should be dismissed with costs.
Nature of the claim 13The amended statement of claim pleaded an entitlement to the sum of $300,000, as claimed in an invoice issued by Gusfact for services rendered by Mr Bauskis in relation to the development of Mr Liew's property at Canley Vale in accordance with the Deed. 14The recitals to the Deed, entered into between Mr Bauskis and Mr Liew, recorded that Laura Bauskis was the owner of the Canley Vale property which she held on trust for the benefit of her father, Mr Bauskis. It also recorded that Mr Liew had purchased the property by contract dated 31 October 2006 with the intention of redeveloping it into two separate residential properties for eventual sale (the Development). This was because Mr Bauskis was unable in his own right to raise the required finance to carry out the development. The operative clauses of the Deed included: "1. Bauskis will have the principal management and supervision of the construction of the Development to its completion. 2. The parties agree to sell the Development after its completion subject to mutual agreement as to sale prices and to share equally the net profits of such sales after payment of all construction costs, moneys borrowed for the Development, agents' commissions and legal expenses." 15The appellants' claim at trial completely departed from the pleaded claim. First, Mr Bauskis asserted that the Deed was "illegal", because it did not satisfy the requirements for the creation of a binding contract. Secondly, he asserted an entitlement, independently of the Deed, to be paid for his own labour and expenses incurred in relation to the development. Counsel for Mr Liew described this at trial as some form of quasi quantum meruit claim. No objection was taken at trial by Mr Liew to the appellants' relying on such a claim although it had not been pleaded by the appellants. 16As appears from the discussion below, the appellants' claim on appeal differed somewhat from the claim asserted at trial. On appeal, counsel for the appellants stated that Mr Bauskis' claim was that he should be paid for the work and labour done to build the two houses, and that the profit (on the development) should be split, but he should get "at least" $300,000.
Procedural rulings by the primary judge 17The hearing commenced on 9 July 2012 and concluded the following day. As noted above, Mr Bauskis appeared for himself and Gusfact. It appears that another person was assisting Mr Bauskis at the bar table, at least on the first day of the hearing.
(a) Rejection of late affidavit 18At the commencement of the hearing, Mr Bauskis sought to tender an affidavit sworn on 6 July 2012 which attached, what he asserted to be, detailed costings regarding the development of the Canley Vale property. The schedule attached to the affidavit set out a summary of work Mr Bauskis said he undertook, the time the work occupied, his assessment of the labour costs involved, as well as what he asserted to be expenses involved in the construction of the dwellings in question. The total of labour costs was $359,520 and expenses were $42,392, covering the period October 2006 to December 2011. The respondent objected to the 6 July affidavit on the ground that it was almost two months late and had only been provided on the morning of the hearing. 19The circumstances in which Mr Bauskis sought to rely on the 6 July affidavit were as follows. On 10 April 2012, the matter was set down for hearing and a registrar of the Court made directions, which included the following: (1)Plaintiff to provide defendant with details of costings in respect of the items referred to in statement and tax invoice numbers 0687 by 8 May 2012. (2)Plaintiff to provide the defendant copies of CDs referred to in plaintiff's affidavit dated 6 March 2012 by 24 April 2012. (3)Defendant to serve reports from builders as to the time required to construct the kit homes, such report to be served by 31 May 2012. 20The tax invoice referred to in Order 1 above was issued by Gusfact and dated 9 November 2011. It claimed an amount of $300,000 comprising a construction management fee of $258,420 and out-of-pocket expenses of $41,580 in relation to the development of the Canley Vale property. The CDs referred to in Mr Bauskis' affidavit dated 6 March 2012, were said to contain the construction manuals for the two dwellings which Mr Bauskis deposed he physically built at the Canley Vale property. 21Mr Bauskis did not comply with either of the directions made on 10 April 2012. Rather, he sent a letter to Mr Liew's solicitors dated 2 May 2012, six days before he was required to provide details of his costings, in which he stated: "I told you that l will not give you these documents until about two weeks before the hearing. My reasons are that, since I have supplied you with the 2 building manuals and Nick already has the costs of concreter, (2 slabs and 2 driveways), bricklayer, plumber, part of the tiling costs, part of the electrical costs, the plasterer's costs and the floating floors, (79A, 4 bedrooms and walk-in wardrobe, 79, 4 bedrooms and walk through wardrobe.) I will supply you with all electrical equipment used, (both 79 & 79A), floor plans for both, (so that the builder can work out size for tiles, etc), and don't forget to mention to the builder the front brick fence with electric security gate. Also water tank and landscaping, also anything else the builder needs is in the manuals. With all this information hopefully your builder can give you an honest quote, not one taken from my itemised account and manipulated to your requirement. With all this information you have about 6 to 8 weeks to get the required quote done, that is plenty of time, so there is no excuse to hold up the hearing, no excuses at all." (sic) 22During argument on Mr Liew's objection to the 6 July affidavit, the primary judge raised with Mr Bauskis whether he had sought legal advice or wished to do so. The transcript records the following exchange between the primary judge and Mr Bauskis: "HIS HONOUR: I understand it. Now I can come back to this. I am going to ask you about this. Have you sought legal representation? PLAINTIFF: The what? HIS HONOUR: Legal representation in any form? PLAINTIFF: I'm just using common sense, that's it. HIS HONOUR: You've made your own decision not to get legal representation? PLAINTIFF: Why do I need legal representation? HIS HONOUR: Because you're running a legal case. PLAINTIFF: No, this is a straightforward case. Look, if any builder came to you in court, right and said I've built a couple of houses and the person that owns the property, does not want to pay for my labour or costs or anything like that, right, that's plain and simple. HIS HONOUR: Mr Bauskis, we're going to start the case in a minute, you've got what affidavits you read. Let me tell you this, your affidavit of 6 July, where you set out the work you did. PLAINTIFF: That's the true bill as it stands. HIS HONOUR: Yes, at the moment, I'm going to reject that because it's too late. PLAINTIFF: You're joking. HIS HONOUR: No, I don't joke. You have to think about this now. No, I don't joke. You have to think about whether you want to continue to run your case with that affidavit rejected or you want to ask for an adjournment. I'm not saying I'll give you one but you've got to think about that. Because there was a set of directions put in place telling you what you have to do and you didn't do it." (Black 113E-U). 23The transcript also records that Mr Bauskis then complained that Mr Liew had not complied with certain court directions made on 10 April 2012, and referred to Order 3 set out at [19] above. After some discussion of this issue, which included reference to the Deed which Mr Bauskis said was not a valid contract, the primary judge informed Mr Bauskis that he proposed to take an early lunch adjournment and that after the adjournment he wanted to hear from him whether he wanted the case to proceed, or whether he wanted an adjournment to go and retain a lawyer. The primary judge explained to Mr Bauskis that he was not saying he would give him an adjournment, but rather he was giving him an opportunity to think about whether to seek an adjournment. The primary judge also informed Mr Bauskis that his current view was that the affidavit served on 6 July was too late. The primary judge told Mr Bauskis that he, Mr Bauskis, had difficult decisions to make because he was doing the job that a barrister would normally do, and that he would give him an opportunity to think about the matter before recommencing the hearing at 2.00pm. Mr Bauskis responded that he did not really understand. The transcript then records the following exchange: "HIS HONOUR: I am asking whether you want to ask for an adjournment to get a lawyer. That's what I am giving you, an opportunity to think about. PLAINTIFF: What's this got to do with this case? HIS HONOUR: You're running a legal case. PLAINTIFF: A what? HIS HONOUR: A legal case, a case in court. PLAINTIFF: So, I am entitled to do that. HIS HONOUR: Indeed you are and often run by lawyers. PLAINTIFF: That's fair enough but I choose on my own free will to do it myself so therefore you're supposed to be helping me a little bit on the way because I don't know the law as well as I should. HIS HONOUR: There's a limit as to how much I can give you help on. I am giving you time to think about your decision not to get a lawyer and whether you want to continue with the case today. That's what I'm giving you fifteen minutes before we adjourn; 15 minutes early." 24Before adjourning the hearing, the primary judge again informed Mr Bauskis that he was giving him an opportunity to think about getting legal advice and ask for an adjournment, but if he decided not to do that the hearing would commence at 2.00pm. 25On the resumption of the hearing after the luncheon adjournment, the primary judge inquired of Mr Bauskis what he wished to do and whether he was ready to proceed. Mr Bauskis responded: "PLAINTIFF: I will proceed. Also, in regards to this illegal deed of agreement, I've been down the library and I've got a copy that I could hand up to you as an exhibit, which is a joint venture which, when you compare that with the deed of agreement, you can form your own opinion on that one. ...". 26Mr Bauskis then proceeded to identify the affidavit evidence on which the plaintiffs relied. Objection was taken by the respondent to two affidavits sworn by Mr Bauskis on 6 July 2012. In relation to the first affidavit, the primary judge rejected [3] and admitted the balance. The primary judge's ruling on the affidavit did not feature in the appellants' submissions on appeal. In relation to the second affidavit, being that identified in [19] above, his Honour heard argument and then gave short reasons for rejecting the late affidavit: Bauskis v Liew (ex tempore judgment, 9 July 2012). In his judgment, his Honour recorded (at [6]) the position adopted by Mr Bauskis, as reflected in the transcript set out above: "... He repeatedly told me in his view his case was simple and this was not necessary and he proposed to exercise his right to conduct the case himself. That is clearly his right. However, in circumstances where a substantial amount of money is in dispute and where it is obvious that there are significant legal issues, no special advantage can be conferred upon the plaintiff if he chose not to even take the first step of obtaining legal advice." 27The primary judge found (at [11]) that the late provision of the affidavit by Mr Bauskis was deliberate. His Honour considered some amelioration for Mr Bauskis' position should be allowed for the fact that he was unrepresented, but that his conduct had to be assessed against the background that he had chosen not to have legal assistance to run his case. His Honour stated: "11. ... I think the position that he put himself in is of a party who knew of a court order; thought he knew better; decided not to comply with it and then complied with it late. That is a very significant matter in determining what to do with the affidavit." 28The primary judge (at [12]) noted two further factors affecting the exercise of his discretion to allow or reject the late affidavit. The first was the relevance of the information in the late affidavit. As to this, his Honour stated that he was not entirely clear of its relevance, but in any event, Mr Liew was entitled to have a proper opportunity to consider the content of the affidavit sufficiently in advance of the hearing so that he could determine whether he wanted to put on evidence in reply or to test some part of it, and that the late provision precluded him this opportunity. 29The second factor considered by the primary judge was whether the best course procedurally would be to allow Mr Bauskis to rely on the affidavit, but for the proceedings to be adjourned. As to this, the primary judge stated: "13. ... Before lunch I specifically put the plaintiff on notice that one option for him for this case was to seek an adjournment and obtain proper legal advice, given its potential complexities and the difficulties that have arisen with his non-compliance. I indicated that I would not necessarily grant that adjournment but I considered it necessary the plaintiff at least be aware of that possibility. The plaintiff did not take up that opportunity then. He has not applied for one now." 30The primary judge considered (at [13]) that it would be inappropriate to allow the affidavit to be read and then put Mr Liew in the position of asking for an adjournment, as he was not at fault. 31Following the procedural rulings on the appellants' evidence, the hearing continued and Mr Bauskis was cross-examined by counsel for Mr Liew. The hearing was adjourned to the following day with Mr Bauskis still under cross-examination.
(b) Adjournment applications 32At the commencement of the second day of the hearing and before he returned to the witness box, Mr Bauskis made an oral application for an adjournment. After hearing argument, the primary judge rejected this application giving short reasons. Mr Bauskis then made an oral application that the primary judge disqualify himself from further hearing the case. The primary judge rejected this application and again gave short reasons. Later on the second day of the hearing, Mr Bauskis made a further oral application for an adjournment to obtain legal representation. His Honour also refused this application, and gave short reasons. Only the adjournment applications are relevant to this appeal: Bauskis & Anor v Liew (ex tempore judgment, 10 July 2012).
First adjournment application 33Mr Bauskis stated that he sought the initial adjournment on three bases. First, on the ground of alleged actual or apprehended bias, which was unparticularised, on the part of the primary judge. Mr Bauskis did not bring any ground of appeal on the basis of actual bias and abandoned Ground 3 of the notice of appeal concerning ostensible bias. Secondly, that Mr Bauskis had new evidence. Thirdly, that Mr Bauskis wished to seek legal advice about court procedures. 34In relation to the new evidence ground, the primary judge stated as follows: "4. ... ultimately there was an indication that there may be a witness whom he could approach who could give an affidavit or perhaps oral evidence about the working he undertook in erecting the buildings. He declined to name the witness and it appears that he has not yet approached that witness as to whether he was willing to come forward." 35Having regard to the exchange that occurred before the registrar on 10 April 2012 when the matter was set down for hearing, the primary judge considered (at [5]) that Mr Bauskis had a sufficient understanding of the court process to know that he was required to assemble witnesses for the hearing before the case was set down for hearing, and that as the witness was unnamed and had not yet been approached as to their availability, Mr Liew should not be visited with the prejudice and costs of an adjournment. 36As to the request to seek legal advice about court procedures, the primary judge referred (at [7]) to his ex tempore judgment given the previous day, during which he had asked Mr Bauskis whether he had sought legal advice in relation to the case and he had indicated that he had not and that he did not see any need to do so. The primary judge also referred (at [8]) to the fact that Mr Bauskis had advised the Court that he had been involved in "20-odd" cases and, to that end, had attempted, in his own words to "indict two judges". The primary judge then observed: "9. A couple of matters flow that that. Coupled with the fact that he brought this case and was content to have it set down for trial without seeking legal advice, the fact that he has conducted other cases should indicate that he, being a literate man, has some understanding of court procedures. The fact that he has apparently, in his own words, 'sought to indict two judges' - and I add, unsuccessfully - indicates that the court would have some hesitation in allowing such a matter as this one to veer off from the path of continuing this hearing unless very good reason was shown." 37The primary judge stated (at [10]) that very good reason needed to be shown for an adjournment, particularly at the point of the hearing which was halfway through cross-examination, and no good reason had been shown. 38Mr Bauskis then made an application that the primary judge disqualify himself on the grounds of actual or ostensible bias. This application was refused. It is unnecessary to say anything further in this regard as this ruling is no longer challenged on appeal.
Further application for adjournment 39Following the completion of the cross-examination of Mr Bauskis and just before Mr Liew would be cross-examined, Mr Bauskis applied for an adjournment to obtain legal representation. 40The primary judge recorded (at [16]) that it was not entirely clear whether the legal representation was sought in order to conduct the cross-examination of Mr Liew, or to complete the matter generally. The primary judge observed (at [17]) that the further application for an adjournment needed to be considered against what had already occurred the previous day. His Honour referred to the fact that Mr Bauskis had been given an opportunity to consider whether he wanted an adjournment to go and get legal advice; that this opportunity was proffered after he had been warned about the likelihood of the rejection of his affidavit; but he nevertheless indicated he wished to proceed. 41His Honour was conscious that Mr Bauskis was an unrepresented litigant and observed as follows: "19. In the ordinary course, if an unrepresented litigant had got to the point in the trial where difficulties in their case were greater than which they were envisaged, or procedural complexities meant that they were out of their depth, then the Court would have to seriously consider whether to grant them an adjournment to seek legal advice. 20. In a case such as this, however, where the plaintiff made a conscious decision that he did not want legal assistance and then, even when the desirability of seeking that assistance was brought to his attention, elected to proceed, then in my view, some very good reason would need to be shown why he should be entitled to change course." 42Ultimately, his Honour rejected the adjournment application, stating: "21. As I indicated in my judgment earlier this morning, this is a plaintiff who has experience in the conduct of proceedings. When I asked the plaintiff what had changed since the interchange between the Bench and him yesterday. He did not point to some apprehended difficulties in cross examining the defendant. Instead he pointed once again to the allegation of bias against me and to my decision to reject his affidavit of 6 July. I have already dealt with the application of the suggestion of bias in the judgment I gave earlier this morning." 43It is now necessary to turn to the substantive issues raised in the proceedings below.
Nature of the parties' relationship 44The essential issue for determination was the legal relationship of the parties. In his substantive judgment given on 26 July 2012: Bauskis & Anor v Liew [2012] NSWSC 838, the primary judge noted (at [34]) that the claim as formulated by Mr Bauskis at the hearing was completely inconsistent with the Deed which he had pleaded in the amended statement of claim. The primary judge also noted (at [36]) the contention of Mr Bauskis that the Deed was "illegal", which he took to mean to be a submission that it did not satisfy the common law requirements for the creation of a contract. 45The primary judge found (at [37]) that both Mr Bauskis and Mr Liew were literate adults, who both had the capacity to contract and give genuine consent and that there was no reason to doubt their respective intentions to create legal relations. His Honour concluded that there was no foundation for Mr Bauskis' contention that the Deed is "illegal". 46The primary judge (at [38]) rejected Mr Bauskis' evidence to the extent that he asserted that he did not have an appreciation from 15 March 2007 that he was entering into some form of joint venture with Mr Liew to develop the property at Canley Vale. His Honour considered that Mr Bauskis' case necessarily involved a scenario whereby he approached Mr Liew seeking finance for the development of his property but that became a transaction whereby Mr Liew became the sole owner and developer, and Mr Bauskis (only) the contracted builder. His Honour rejected this as being inherently unlikely in circumstances where there was no written building contract and no specified timeframe for completion of the development. 47The primary judge recorded (at [39]) that Mr Bauskis agreed that there was no written agreement between the parties other than the Deed and that when asked about the existence of any other form of agreement Mr Bauskis gave the following evidence: "The only agreement we had was the original agreement, verbally, that when Nick offered to finance me and I pay him back at the end of the thing whatever it was, out of pocket expenses and that was it. There was never a mention of sharing profits and things because at that time I owned the property or Laura my daughter owned the property because I didn't have it in my name. It was in her name, right? And he was going to finance me out of the goodness of his heart and basically that's it. And a gentleman's agreement is supposed to be a gentleman's agreement. Then Nick bought this out six months later to cover himself most probably and at the same time he stopped doing my tax, the whole lot." 48It should be interpolated at this point that shortly prior to this answer, Mr Bauskis had given the following evidence under cross-examination on the issue of some "other" agreement: "Q. Can I - in the course of your affidavits, any of them, can I suggest to you that there is no evidence from you of any such verbal agreement, what do you say to that? A. What do I say to that? Q. Yeah, you're now saying that there was some verbal agreement that Nick would pay you $300,000, is that right? A. No. Q. Some verbal agreement he would pay you for your time and expenses in doing further construction work, is that right? A. No. Q. What was the verbal agreement that you are now suggesting? A. This was before October of 2006 - we had a verbal agreement that he was going to finance me, right? In building the two houses, right? And at the end of the time I would repay him back the money that he spent on it, right? That was the verbal agreement we had." 49The primary judge observed (at [40]) that the oral agreement asserted by Mr Bauskis was fundamentally inconsistent with any entitlement of either Mr Bauskis or Gusfact to invoice Mr Liew for the work undertaken in erecting the houses. Rather, the evidence of this conversation was entirely consistent with the pursuit of a development whereby Mr Liew agreed to provide finance which he raised by providing security over the property. 50The primary judge found (at [41]) that the only evidence of the legal relationship between the parties which governed the development of the Canley Vale property was the Deed, and that no valid reason had been put forward to impugn the Deed.
Claim for work and labour done 51Having found that the legal relationship between the parties was governed by the Deed, the primary judge (at [43]) rejected the appellants' claim to recover any form of management fee or the cost of Mr Bauskis' labour. The primary judge stated that to the extent that Mr Bauskis managed and supervised the construction of the development to its completion he was performing his obligations under cl 1 of the Deed. His Honour did not necessarily accept that Mr Bauskis' work in erecting the kit homes went beyond the performance of that obligation. His Honour observed that even if the work performed by Mr Bauskis went beyond his obligations under cl 1 of the Deed, no legal basis had been identified on which either of the appellants was entitled to recover an amount for Mr Bauskis' time and labour in doing so. 52As to the claim for reimbursement for payments made to third party suppliers, his Honour accepted (at [49]) that these could be brought to account pursuant to cl 2 of the Deed, if the appellants could demonstrate that they incurred expenses to third parties in pursuit of the development which had not been reimbursed. His Honour then referred (at [50]) to a number of difficulties with the appellants' claim for reimbursement, including apparent errors in the appellants' claim. 53The primary judge also observed (at [50]-[51]) that the appellants had not provided supporting documentation; that this issue had been taken up with Mr Bauskis in cross-examination on the first day during which Mr Bauskis conceded that he had not produced any supporting documents; and the issue was again raised in cross-examination on the second day of the trial at which time Mr Bauskis stated that he did not need to bring them along asserting "My word is law, bond. I swore an oath that these are correct and that's it ...". 54The primary judge noted (at [55]) that Mr Bauskis' evidence that his word was "law, bond" sat uneasily with later answers he gave when pressed as to whether he had any justification for the figures included in invoice. Mr Bauskis conceded that the round dollar figure $300,000 was a "made up figure". 55The primary judge found (at [57]), that the appellants had not demonstrated that they had incurred any of the expenditure listed in the invoice and that despite a number of opportunities to do so, they had not brought forward any documentary evidence to support those entries. His Honour noted (at [58]) that the only evidence in support of the entries were assertions by Mr Bauskis which he did not accept.
Adjustment in favour of Mr Bauskis 56The primary judge then dealt with certain adjustments which the parties sought in relation to the moneys which had been paid into court from the sale of the remaining Canley Vale property. The net proceeds of sale of the first property had already been paid by Mr Liew to his bank, which had provided him with the finance to pay out Laura Bauskis' mortgage, and the costs of erecting the two houses.
Unpaid purchase price 57Relevantly, Mr Bauskis sought an adjustment in relation to the purchase price of the Canley Vale property which he said had not been paid by Mr Liew to his daughter, Laura Bauskis, who held the property on trust for him. Counsel for Mr Liew conceded at the trial that the only amount paid by Mr Liew in October 2006 was the sum of $186,013.95, to discharge the existing mortgage on the Canley Vale property. The issue requiring determination was what adjustment should be made in Mr Bauskis' favour by reason of the difference in the amount paid to discharge Laura Bauskis' mortgage and the balance of the purchase price. 58The outcome of this issue turned on what was the true purchase price for the Canley Vale property. Mr Bauskis contended that it was the sum of $350,000, as stated on the contract for sale between Laura Bauskis and Mr Liew. Mr Liew asserted that it was a lesser figure of $260,000, which he had orally agreed with Mr Bauskis. This lesser figure represented the amount of finance which Mr Liew had borrowed against the Canley Vale property, part of which ($186,013.95) he used to pay out Laura Bauskis' mortgage and the balance he contributed to the cost of the development. 59The primary judge resolved this issue in favour of Mr Liew, finding (at [64]) that the true purchase price was $260,000. His Honour noted that neither Mr Liew nor Mr Bauskis had been cross-examined on this issue, but having regard to the view he formed as to Mr Bauskis' credibility, he accepted Mr Liew's version as to what was agreed in respect of the purchase price. As a consequence, the primary judge found (at [66]) that an allowance should be made in Mr Bauskis' favour in an amount of $71,794.10. This reflected, in effect, Mr Bauskis' equity contribution to the development.
Further hearing on relief 60Following a further hearing on 20 September 2012, of which notice was given to Mr Bauskis but which he did not attend, the primary judge dealt with supplementary submissions which the Court had requested addressing a number of topics. This included the calculation of the appropriate adjustment to be made for GST on the sale of the properties by Mr Liew, the final form of orders that should be made and the question of costs. These were the subject of an ex tempore judgment: Bauskis & Anor v Liew (No 2) [2012] NSWSC 1148. The orders made on that date provided, amongst other things, that: (1)An amount of $62,745.45 of the moneys paid into court to be paid out to Mr Liew together with 30.73 per cent of the interest earned on those moneys, upon the undertaking of Mr Liew by his counsel to account to the Deputy Commissioner of Taxation for GST in respect of the sale of the Canley Vale properties in that amount. (2)The amount of $46,737.17 of the moneys paid into court be paid out to Mr Liew together with 22.895 per cent of the interest earned on those moneys. (3)The amount of $94,681.27 of the moneys paid into court be paid out to Mr Bauskis together with 46.375 per cent for the interest earned on those moneys. (4)The plaintiffs pay the defendant's costs of the proceedings.
Issues on appeal 61The notice of appeal raised nine grounds of appeal. Ground 3, relating to ostensible bias of the primary judge against Mr Bauskis, was not pressed on the hearing of the appeal. The issues raised by the remaining grounds may be grouped as follows: (1)Whether the primary judge failed to afford procedural fairness to the appellants when refusing their adjournment applications and in rejecting parts of Mr Bauskis' evidence (Grounds 1, 2 and 4). (2)What was the nature of the legal relationship between the parties. In particular, whether the appellants could claim for work and labour done in addition to Mr Bauskis making a claim to a profit share under the Deed (Grounds 5, 6, 7 and 8)? (3)What adjustment was required to take into account the non-payment of the purchase price for the Canley Vale property by Mr Liew (Ground 9)?
Procedural fairness 62Counsel for the appellants contended that the primary judge erred in the exercise of his discretion when refusing the adjournment applications and in rejecting the late affidavit. It was accepted that the appellants needed to establish error in these discretionary decisions of the primary judge in the House v The King sense: [1936] HCA 40; (1936) 55 CLR 499. 63As to the refusal to grant the adjournment applications, counsel for the appellants submitted that Mr Bauskis was ill prepared for the hearing notwithstanding the confidence he expressed to the primary judge that he could run his own case. 64Counsel for the appellants clarified during oral submissions that the only basis on which it was contended that there was an error in the exercise of the primary judge's discretion to refuse the adjournment applications was that it must have been obvious that Mr Bauskis was incapable of conducting a case without assistance. It was submitted that [9] of the primary judge's reasons given on 10 July 2012 disclose error (see [36] above). 65As to the ruling not to allow the late affidavit, counsel for the appellants accepted that the 6 July affidavit was both late and not in admissible form. When asked by the Court to clarify Ground 4 of the notice of appeal, counsel for the appellants submitted that it was to be understood as contending that the primary judge erred in refusing to accept crucial evidence that was not in admissible form.
The Court's duty to unrepresented litigants 66The appellants' submissions raise the issue of the role of the Court in ensuring a fair hearing. The Court's duty to unrepresented litigants was examined in Hamod v State of New South Wales [2011] NSWCA 375 at [309]-[316] by Beazley JA (as her Honour then was) where the authorities are collected. The following propositions emerge from those authorities relevant to the present case. 67First, the Court's obligation in the case of a self-represented litigant is to give sufficient information as to the practice and procedure of the Court to ensure that there is a fair trial to both parties. The application of this principle will vary depending upon the circumstances of the case: see Jae Kyung Lee v Bob Chae-Sang Cha [2008] NSWCA 13 per Basten JA at [48]; Abram v Bank of New Zealand (1996) ATPR ¶41-507, 43,341, 43,347; Microsoft Corporation v Ezy Loans Pty Ltd [2004] FCA 1135; (2004) 63 IPR 54; Pezos v Police [2005] SASC 500; (2005) 94 SASR 154. 68Secondly, the Court's duty is not solely to the unrepresented litigant. The obligation is to ensure a fair trial for all parties. This is why the duty is usually stated in terms that require that the impartial function of the judge is preserved, whilst also requiring the judge to intervene where necessary to ensure the trial is fair and just: see Tomasevic v Travaglini [2007] VSC 337; (2007) 17 VR 100 at [95]; Barghouthi v Transfield Pty Ltd [2002] FCA 666; (2002) 122 FCR 19 at 23; NAGA v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 944 at [11]; Nagy v Ryan [2003] SASC 37 at [52]-[53]. 69Thirdly, the duty of a trial judge to assist an unrepresented litigant does not extend to advising the litigant as to how his or her rights should be exercised. That is, it is not the function of the court to give judicial advice to, or conduct the case on behalf of, the unrepresented litigant: see Bhagwanani v Martin [1999] SASC 406; (1999) 2004 LSJS 449; Clark v State of New South Wales (No 2) [2006] NSWSC 914. 70Fourthly, the trial judge must remain at all times the impartial adjudicator of the matter, measured against the touchstone of fairness. In this regard, an unrepresented party is as much subject to the rules as any other litigant: Rajski v Scitec Corporation Pty Ltd (Court of Appeal, 16 June 1986, unreported) per Samuels JA at 14.
Refusal of adjournment applications 71The primary judge's decisions on the adjournment applications were discretionary. The grounds upon which such decisions may be challenged are confined to those identified in House v The King at 504-505. As noted by Macfarlan JA in Newton v Ellis [2012] NSWCA 106 at [17] (Beazley and Whealy JJA agreeing): "... The difficulty of challenging the decisions is accentuated by the fact that they concerned a matter of practice or procedure, an area into which appellate courts have shown a marked reluctance to intervene (see In re the Will of F B Gilbert (dec) (1946) 46 SR (NSW) 318 at 323; Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc [1981] HCA 39; 148 CLR 170 at 177). A 'tight rein' on interference with such matters is necessary because the 'disposal of cases could be delayed interminably, and costs heaped up indefinitely, if a litigant ... could, at will, in effect transfer all exercises of discretion in interlocutory applications from a Judge in Chambers to a Court of Appeal': In re the Will of F B Gilbert (dec) at 323 per Jordan CJ." 72The relevant principles were referred to in Sali v SPC Ltd [1993] HCA 47; (1993) 67 ALJR 841, where the High Court, by majority, stated: "In Maxwell v Keun, the English Court of Appeal held that, although an appellate court will be slow to interfere with the discretion of a trial judge to refuse an adjournment, it will do so if the refusal will result in a denial of justice to the applicant and the adjournment will not result in any injustice to any other party. That proposition has since become firmly established and has been applied by appellate courts on many occasions. Moreover, the judgment of Atkin LJ in Maxwell has also been taken to establish a further proposition: an adjournment which, if refused, would result in a serious injustice to the applicant should only be refused if that is the only way that justice can be done to another party in the action. However, both propositions were formulated when court lists were not as congested as they are today and the concept of case management had not developed into the sophisticated art that it has now become." (References omitted). 73As further noted by Macfarlan JA in Newton v Ellis (at [19]), the importance of an adjournment's effect on "the claims of other litigants and the public interest in achieving the most efficient use of Court resources" is confirmed by the more recent High Court decision in Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175. See also Hamod v State of New South Wales at [131]-[145]; compare State of Queensland v JL Holdings Pty Ltd [1997] HCA 1; (1997) 189 CLR 146.
The first adjournment application 74It is clear from the primary judge's reasons given on 10 July 2012 (see [33]-[38] above), that in rejecting the first adjournment application his Honour attached primary significance to Mr Bauskis' refusal to divulge the identity of the possible new witness, the fact that such witness had not yet been approached by Mr Bauskis and that there was no indication whether that person would be available to give evidence if the hearing was adjourned. 75Ultimately during oral argument, counsel for the appellants did not contend that there was any error in the primary judge's approach to the new evidence ground for the adjournment. Rather, counsel for the appellants contended that the primary judge erred in not granting the appellants' request for an adjournment to seek legal advice about court procedures. 76However, the transcript of the exchange between Mr Bauskis and the primary judge on 10 July 2012, reveals that Mr Bauskis did not identify any aspect of the Court's procedure upon which he was in doubt or required legal advice. To the contrary, it records the matters referred to in [9] of the judgment of 10 July 2012, concerning the significant number of cases which Mr Bauskis had run and that, in his words he had "indicted two judges". 77The timing and context of the adjournment application is highly relevant. The hearing was at a point on the second day where Mr Bauskis was under cross-examination. Counsel for the appellants accepted that Mr Bauskis voluntarily started the trial unrepresented, and that he made that decision consciously. No complaint is made on appeal that the trial should have been adjourned on the first day when Mr Bauskis was appearing for himself and Gusfact. The substantive reasons given by Mr Bauskis for the adjournment related to new evidence and the bias allegation against the primary judge. The new evidence ground was not ultimately pressed on appeal. The bias allegation is not relevant on appeal. 78Insofar as counsel for the appellants submitted that the new evidence ground demonstrated that Mr Bauskis did not understand the legal procedure, this submission must be rejected. First, it is clear from the transcript of the proceedings before the registrar on 10 April 2012 and from Mr Bauskis' subsequent letter to the solicitors for Mr Liew dated 10 May 2012, that Mr Bauskis understood that he had been directed by the court to provide details of the costings set out in the Gusfact invoice. 79Secondly, Mr Bauskis made a conscious decision to not comply with those directions, and attempted to put the obligation to take the first step in relation to specifying what was a reasonable sum for the cost of erection of the homes onto Mr Liew. However, Mr Bauskis was required to comply with the rules as much as any other litigant. 80Thirdly, consistent with the Court's duty to unrepresented litigants, the primary judge raised with Mr Bauskis on the first day of the trial, the possibility that he might seek an adjournment for the purpose of obtaining legal advice and representation in relation to the conduct of his claim. His Honour also warned Mr Bauskis that he was likely to reject the late affidavit. Mr Bauskis was granted sufficient time over the extended luncheon adjournment to consider his position. Upon the resumption of the hearing, Mr Bauskis indicated that he wanted to proceed without legal representation. That was his entitlement, but this did not mean he was not required to comply with the Court's earlier directions. 81Fourthly, contrary to the submission by counsel for the appellants, the transcript of the proceedings on 9 and 10 July 2012 reflects that Mr Bauskis sufficiently understood the practice and procedure of the Court so as to present his own case. He made a conscious decision, having been warned of the likelihood of rejection of the late affidavit, not to seek an adjournment on the first day of the hearing so as to obtain legal advice and representation. The difficulties experienced by Mr Bauskis thereafter were more a reflection of his dissatisfaction with the procedural rulings of the primary judge. 82In my view, no error has been shown in the primary judge's exercise of discretion to refuse the first adjournment application. Furthermore, there is no substance in the appellants' complaint that the refusal of the adjournment application involved a denial of procedural fairness. No injustice has been demonstrated on appeal.
Further adjournment application 83It is clear from the primary judge's reasons given on 10 July 2012 (see [39]-[43] above), that in refusing the further adjournment application, his Honour attached primary significance to Mr Bauskis' inability to explain what had changed since the exchange between the primary judge and Mr Bauskis on the first day of the hearing, when the primary judge suggested to Mr Bauskis that he give consideration to whether he wished to seek an adjournment to obtain legal advice and representation and Mr Bauskis' subsequent indication that he wished to proceed unrepresented. There was no error in the primary judge's approach. 84It is apparent from the transcript of the proceedings before the primary judge on 10 July 2012, that the reasons advanced by Mr Bauskis for the further adjournment related to his dissatisfaction with the primary judge's decision to reject his affidavit of 6 July and the primary judge's refusal of the appellants' recusal application. For the reasons explained below, no error has been shown in the evidence ruling, and the bias allegation is not a matter pressed on appeal. 85Moreover, it is implicit from the ex tempore judgment (at [19]-[20]) where the primary judge considered the position of Mr Bauskis as an unrepresented litigant, that his Honour was conscious of the duty of the Court to ensure a fair hearing when considering the adjournment application, particularly an application by a self-represented litigant to seek legal advice. His Honour weighed this matter against two countervailing matters. First, the conscious decision by Mr Bauskis on the previous day not to seek legal assistance, including having elected to proceed despite the Court drawing to his attention the desirability of seeking that assistance. Secondly, Mr Bauskis could not identify what had relevantly changed in terms of absence of legal representation since the first day of the trial. 86In my view, the primary judge did not err in refusing the further adjournment application. Again, no injustice has been demonstrated on appeal in respect of that ruling.
Rejection of late affidavit 87As previously noted, counsel for the appellants accepted that the late affidavit was not in admissible form. It was submitted that if an adjournment had been granted, then the appellants would have remedied the inadmissible affidavit. 88However, this submission ignores the circumstances in which the appellants sought to rely on the late affidavit. These are set out at [19]-[31] above. In refusing to comply with the Court's directions made on 10 April 2012, Mr Bauskis engaged in a degree of brinkmanship, as he attempted to put the obligation to take the first step to provide evidence as to the reasonable cost of erecting the two homes onto Mr Liew. So much was accepted by counsel for the appellants. 89No attempt was made in submissions to demonstrate error in the primary judge's reasons for rejecting the late affidavit. In my view, the appellants' complaint is without foundation. The evidence which was rejected was late and not in admissible form. The lateness reflected a conscious decision by Mr Bauskis not to comply with earlier directions of the Court. The prejudice to Mr Liew if the late affidavit were allowed was obvious. There was no error in his Honour's approach in rejecting the late affidavit. 90Insofar as the appellants' complaint in relation to this procedural ruling was put as part of their broader complaint that the primary judge should have granted the adjournment applications, then for the reasons given above, that complaint also fails.
Nature of the parties' legal relationship 91The appellants did not challenge or otherwise attempt to impugn on appeal the Deed dated 15 March 2007, which recorded the agreement between Mr Bauskis and Mr Liew to jointly develop the Canley Vale property and share the net proceeds of sale. 92Counsel for the appellants submitted that notwithstanding the terms of the Deed, Mr Bauskis was entitled to claim for work and labour done in relation to building the two houses, and that the profit should be split, but that he should get at least "$300,000". The legal basis for such claim was described in oral submissions as a quantum meruit claim, or an "arrangement or understanding", which amounted to a contract. 93As to a quantum meruit claim, it was not suggested by the appellants that this was to be understood as a restitutionary claim. Rather the claim was advanced as one made pursuant to a contract containing an express or implied term to pay a reasonable sum for services rendered or work done under the contract. The appellants' submissions recognised an obvious difficulty with a restitutionary claim stemming from the principle that a claim of this nature cannot be made where a valid contract covers the field, as noted by Mason P (Campbell JA and Handley AJA agreeing) in Nikolic v Oladaily Pty Ltd [2007] NSWCA 252 at [101]. The contractual allocation of risk cannot be subverted by alleging a cause of action stemming from unjust enrichment covering the same conduct. 94As to the claim of an "understanding or arrangement" outside of the Deed that Mr Bauskis would be paid for his labour, counsel for the appellants submitted that there must have been such an "agreement" separate from the Deed, because someone had to be paid for building the houses. 95The only evidence of some "other" agreement between Mr Bauskis and Mr Liew was that given during cross-examination of Mr Bauskis. There are three relevant passages of evidence. The first two passages are set out at [47] and [48] above. The third occurred when Mr Bauskis repeated this evidence a short time later in cross-examination as follows: "Q. Sir, I do have to suggest to you, sir, there was no extra agreement that you have now given evidence about? A. The only agreement we had was the original agreement, verbally, that when Nick offered to finance me and I pay him back at the end of the thing whatever it was, out of pocket expenses and that was it. There was never a mention of sharing profits and things because at that time I owned the property or Laura my daughter owned the property because I didn't have it in my name. It was in her name, right? And he was going to finance me out of the goodness of his heart and basically that it. And a gentleman's agreement is supposed to be a gentleman's agreement. Then Nick bought this out six months later to cover himself most probably and at the same time he stopped doing my tax, the whole lot." (sic). 96Two observations should be made concerning the evidence referred to at [47], [48] and [95] above. First, Mr Bauskis denied any verbal agreement with Mr Liew, that Mr Liew would pay him for his time and expenses in doing construction work. Secondly, the terms of the alleged verbal agreement before October 2006, were quite inconsistent with a contract to be paid a reasonable sum for work and labour done. Rather, Mr Bauskis' evidence asserted a verbal agreement with Mr Liew before October 2006, that Mr Liew would finance Mr Bauskis to build the two houses and at the end of the development Mr Bauskis would repay him the money which had been advanced. Clearly, any earlier "agreement" to this effect was overtaken by subsequent events. First, the sale of the Canley Vale property to Mr Liew in October 2006. Secondly, the terms of the Deed in March 2007, which provided for a sharing of the net profit of the development in respect of which, Mr Bauskis was to manage and supervise the development and Mr Liew was to provide the finance. 97Thus, Mr Bauskis' oral evidence was inconsistent with either a claim on a quantum meruit basis, or an agreement with Mr Liew to be paid for his time and expenses. Counsel for the appellants sought to avoid these difficulties by submitting that Mr Bauskis' evidence under cross-examination contained "ill advised answers", and "incorrect" answers, because they did not make sense. However, it was not submitted on behalf of the appellants that Mr Bauskis did not understand what it meant to give truthful evidence when under cross-examination. Further, it did not follow that Mr Bauskis' evidence "did not make sense". 98Insofar as the appellants claimed an entitlement to a construction management fee of $258,420, this is inconsistent with cl 1 of the Deed, which obliged Mr Bauskis to manage and supervise the development, the consideration for which was an equal share of the net profits of the development. 99The position is that the appellants' claim on appeal was put differently to the claim advanced at the trial, which in turn was completely different to the pleaded claim. The pleaded claim relied solely upon the Deed. The claim advanced at trial disavowed the Deed and relied upon a verbal agreement between Mr Bauskis and Mr Liew. However this other "agreement" was not a quantum meruit claim nor one which entitled Mr Bauskis to be paid "at least" $300,000. Rather it was a claim that Mr Liew would finance the development and Mr Bauskis would repay him the amount financed at the end of the project. By contrast, the claim advanced on appeal sought to rely both on a quantum meruit claim and an entitlement to a profit share under the Deed, but that Mr Bauskis was entitled to "at least" $300,000. 100Counsel for the appellants conceded that there was no "hard evidence" of an agreement which supported the way in which the claim was put on appeal. This concession was properly made. In my view, there is no basis for such a claim by either of the appellants. There was no error in the primary judge rejecting the appellants' claim at trial advanced on the basis of some "other" agreement, independent of the Deed. 101Furthermore, no attempt was made on appeal to challenge the primary judge's findings that the appellants did not establish by admissible evidence either the nature of the work, time involved, the reasonable value of work performed or the expenses incurred by the appellants in relation to the development. This is fatal to the appellants' challenge to the primary judge's findings concerning the claim for work and labour done. 102In my view, Grounds 5, 6, 7 and 8 of the notice of appeal have not been made out.
Adjustment for non-payment of purchase price 103 It was common ground below that the payment made by Mr Liew in discharge of Laura Bauskis' mortgage over the property ($186,013.95), represented a part-payment of the purchase price owing by him to Laura Bauskis. The issue requiring determination by the primary judge was what further amount was due by Mr Liew. This turned on whether the true purchase price was $350,000 as stated in the contract for sale, or a lesser figure of $260,000 as asserted by Mr Liew. 104The evidence in support of the lesser figure was contained in a statement of cross-claim ([4] and [5]), which was verified by Mr Liew on or about 20 December 2011. This document was tendered by Mr Liew, without objection by Mr Bauskis, notwithstanding it was in inadmissible form. Paragraph 4 of the statement of cross-claim, as verified by Mr Liew, pleaded: "Despite the contract price stating a purchase price of $350,000, it was agreed between the parties that the title of the property would be transferred to the cross-claimant based on consideration in the amount of $260,000, associated transactions have been listed in point 5 as per below. The upshot for the cross-defendant was that as per deed noted in point 6, it was agreed that the cross-claimant would obtain finance as he had the requisite capacity and that the cross-defendant would supervise the construction works. Any net profits from the sale of the two separate dwellings after fees, interest and expenses would be divided equally between the cross-claimant and the cross-defendant." 105The appellants filed a reply to Mr Liew's cross-claim, which was verified by Mr Bauskis on 23 February 2012, and which denied [4] of the statement of cross-claim. 106Neither party was cross-examined on this issue. It appears that the focus of the parties at trial was on Mr Bauskis' claim for $300,000 for work and labour done. Nevertheless, the parties clearly were in dispute as to the true purchase price of the Canley Vale property. 107The primary judge noted the absence of cross-examination on this issue and resolved it having regard to his general view of Mr Bauskis' credibility. 108Counsel for the appellants submitted that the primary judge erred in accepting the evidence of Mr Liew rather than Mr Bauskis, who he found was not a credible witness. No direct challenge was made to the credibility finding in relation to Mr Bauskis. Rather, the appellants' complaint was that, on this issue, notwithstanding the credibility finding, the primary judge should have preferred the evidence of Mr Bauskis to that of Mr Liew because the contract for sale stated the purchase price was $350,000.
Fact finding in the absence of cross-examination 109As to the primary judge's approach, the present case was one in which both parties failed to cross-examine the other on a relevant issue. The legal principles concerning the significance of failure to cross-examine a witness are collected in Hamod v State of New South Wales at [336]-[340] per Beazley JA. The prima facie position is that a court will accept the unchallenged evidence of a witness. This is on the principle that the party who fails to cross-examine a witness is taken to have accepted that evidence: Seymour v Australian Broadcasting Commission (1997) 19 NSWLR 219 at 236 per Mahoney JA; Knight v Maclean [2002] NSWCA 314 at [34] per Heydon JA (Meagher JA and Young CJ in Eq agreeing); Reid v Kerr (1974) 9 SASR 367 at 375. 110However, the principle is not absolute and even if evidence is unchallenged, a party may be able to demonstrate that the evidence is inherently illogical or unreliable, or that the evidence is based on an incorrect or incomplete history or upon unproven assumptions. 111Furthermore, even if unchallenged evidence is not shown to be defective, a court is not bound to accept it if the opposing party calls evidence of a substantial nature which contradicts it. This is particularly relevant in the present case where both parties gave evidence in the form of verified pleadings concerning the true purchase price of the Canley Vale property: see HSH Hotels (Australia) Ltd v Multiplex Constructions Pty Ltd [2004] NSWCA 302; (2005) 21 BCL 454 at [87] per Tobias JA (Mason P and Hodgson JA agreeing); Ali v Nationwide News Pty Ltd [2008] NSWCA 183 at [112].
Consideration 112The evidence concerning the true purchase price of the Canley Vale property was contested by each party tendering verified pleadings which asserted a different purchase price. In the absence of cross-examination, the primary judge was left to resolve the issue having regard to the respective credibility of the witnesses generally, and the inherent likelihood of the disputed evidence given by each of them. 113In my view, no error has been shown in the primary judge's acceptance of the evidence of Mr Liew in preference to that of Mr Bauskis on this issue. The reason why the contract for sale may have contained a higher purchase price than the price "agreed" between Mr Liew and Mr Bauskis (who was the beneficial owner of the Canley Vale property), may have related to the amount of finance sought to be raised by Mr Liew by way of mortgage over the property. It is unnecessary however to speculate in this regard. Relevantly, the inference drawn by the primary judge at [64] was that it was inherently unlikely that Mr Liew would have agreed to contribute more than the finance he raised on the Canley Vale property towards the development. This has not been shown to be in error. 114In my view, Ground 9 of the notice of appeal has not been made out.
Conclusion and orders 115The appellants have failed to establish that they were denied procedural fairness as a consequence of the primary judge's rulings rejecting Mr Bauskis' late affidavit and refusing their applications for an adjournment of the hearing. 116The appellants have also failed to establish the substantive grounds of their appeal, which asserted an entitlement to be paid for work and labour done in relation to the development of the Canley Vale property. 117The first appellant's rights against the respondent are governed by the terms of the Deed with the respondent which provided for an equal sharing of net profits of the development. Further, the first appellant has not established an entitlement to a larger adjustment in respect of the non-payment of the purchase price of the Canley Vale property, than that allowed by the primary judge. 118I propose the following orders: (1)Appeal dismissed. (2)Appellants to pay the respondent's costs.
Amendments 12 September 2013 - Typo Amended paragraphs: [73] 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: 12 September 2013
Bauskis
Liew
[1999] SASC 406
[2005] SASC 500
[1993] HCA 47
[2007] VSC 337
(1974) 9 SASR 367
(1997) 19 NSWLR 219
(1936) 55 CLR 499
(2004) 63 IPR 54
(2005) 94 SASR 154
(2007) 17 VR 100
(2002) 122 FCR 19
(1993) 67 ALJR 841
(2009) 239 CLR 175
(1997) 189 CLR 146
[2009] HCA 27
[1936] HCA 40
Appeal dismissed with costs.