Camporeale Holdings Pty Ltd trading as Michael Camporeale Builders v Spectra Electrical & Communications Pty Ltd

The procedural history

1. These proceedings have been the subject of multiple case management orders. It would be fair to say that these orders have granted the plaintiff a great deal of leeway, largely because of the health problems suffered by Mr Camporeale, the company's principal and directing mind.
2. On 13 December 2017 Olsson SC DCJ made the following orders: "Proceedings no: 2017/367976 1. Leave to plaintiff to file in court affidavit of John Dela Cruz. 2. Dismiss plaintiff's Notice of Motion. Proceedings 2017/372123 1. Make orders in accordance with the defendant's Notice of Motion. 2. I issue a Debt Certificate pursuant to s.7 of the Contractors Debts Act, but note that the defendant and applicant for that debt has said in open court that the only entity on which they would seek to recover that money would be Bankstown council in respect of the Certificate of Debt. Proceedings 2017/367059 1. I uphold the Notice of Motion filed by the plaintiff in those proceedings and order, pursuant to s.140 of the Civil Procedure Act, transferring the Local Court proceedings number 2017/372284 to the Sydney Registry of the District Court of NSW. 2. I make an order staying the proceedings in the Local Court until the return date of the present District Court proceedings. Proceedings 2017/367976 and 2017/367059 1. Leave for plaintiff to serve Statements of Claim on the current representatives of the defendant, noting that they have no direct instructions to accept service. 2. Direct that the ordinary rule for the Defence to be filed in 28 days be extended to 29 January 2018. 3. Direct the plaintiff to file and serve any evidence on which it intends to rely by 16 February 2018. 4. List for directions before the civil list judge on 23 February 2018 at 9.30 am. 5. Direct the defendant to file and serve any evidence on which it intends to rely on or before 23 March 2018. 6. Grant leave to contact my associate to confirm a hearing date by 4pm tomorrow afternoon, or relist on Friday before Judge Olsson. 7. Liberty to apply on 3 days' notice. 8. Note that the hearing date is to be confirmed on 23 February 2018. 9. Direct that the Notice to Produce to be issued by the plaintiff be returnable by 4pm on 20 December 2017. 10. Reserve the question of costs until 23 February 2017. 11. The exhibit may be returned."
3. On 18 December 2017 the proceedings were listed for hearing on 5 June 2018 with an estimate of 2 days. However, the hearing could not go ahead. The plaintiff was unable to comply with timetable orders for reasons set out in the affidavit of Mr John Dela Cruz, principally due to the illness of Mr Camporeale, who was suffering from cancer.
4. On 4 June 2018 Mahony SC DCJ made the following orders: "1 Make Orders in 1-3 in SMO dated 4/6/18 signed by the parties. 2 The hearing dates of 5 and 6th June are vacated. 3 Costs of the hearing of December 2017 continue to be reserved. 4 Any costs thrown away by vacation of HD are reserved. 5 SOFD on Friday 15/6/18 at 9.30am before Jud Reg, for a timetable and allocation of a Hearing Date. 6 Any further HD allocated is not to be vacated unless exceptional circumstances are demonstrated."
5. On 15 June 2018 Judicial Registrar Howard provided a second hearing date of 4 February 2019, again for two days. The orders that were made by Judicial Registrar Howard were as follows: 1. The plaintiff its evidence in chief by 30 July 2018. 2. The defendants serve any evidence by 30 September 2018 3. The plaintiff serve any reply evidence by 30 November 2018.
6. On 13 July 2018 the plaintiff's solicitors filed a notice of ceasing to act, their affidavits were due by 30 July. These were not filed. Nor was any extension of the timetable ever sought from the court.
7. At some stage in approximately October 2018 (according to the affidavit of the solicitor for the defendants, which is Exhibit 6), the plaintiff's current solicitor came into the matter and there were informal discussions between the parties. The solicitor for the defendants' evidence is that he assumed that the material in question would be put on sooner or later and he was prepared to agree to some form of a revised timetable for that purpose.
8. As it happened, no such material was put on. By early December, the solicitors for the defendants were considering bringing an application pursuant to r 12.7 Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") for the summary dismissal of these proceedings.
9. What happened next is unfortunate. No evidence at all was put on in the Kogarah proceedings but evidence put on in the Yagoona proceedings which had clearly been prepared prior to the end of the court term was not served upon the defendants until 18 December 2018, which was during the first week of the court vacation. That evidence included an expert report which was filed contrary to the provisions of UCPR r 31.28(1)(a).
10. The affidavit concerning the merits of the claim was an affidavit of Mr Camporeale sworn on 8 December 2018. It is unsatisfactory for a number of reasons. First, it set out a claim damages of the kind never pleaded or particularised before. Second, there were serious new issues raised, such as an allegation of doctoring of documents. Third, there was a new claim for liquidated damages of $160,000 which was unexplained in terms of quantum. Fourth, the precise sum claimed by Mr Camporeale had changed (from being an offset to the sum set out in the adjudicator's report plus some unspecified sum for breach of contract) to the following claim: "The total claim by the Plaintiff is therefore the sum of $213,371.37 Ex GST
11. Provisional sum discrepancy $15,780.87 Ex GST
12. Liquidated damages $160,000.00 Ex GST
13. Defective works $25,953.21 Ex GST
14. Delay costs $11,637.27 Ex GST

A monetary judgment against the Defendant in the sum of $234,708.50 (inclusive of GST) for breach of contract The Plaintiff also claims interest in accordance with section 100 of the Civil Procedures Act 2005 in that interest is to rum on the sum of $234,708-50 From 5th December 2017 to 12th December 2018 at 5.5% per annum (12 months), being an amount of $12,908.50."

1. Although only a small matter in comparison to these oversights, there was no compliance by the plaintiff with the standard orders for hearing in the form of a chronology, a list of issues or a schedule of damages.
2. The defendants initially sought an adjournment by way of notice of motion returnable before the list judge on 1 February 2019, the first available date in the court term but effectively the day before the hearing. The amount of documentation in the file was such that the file was referred to me for determination of the defendants' application to the list judge for an adjournment as part of the hearing of these proceedings.

The applications before the Court

1. However, the defendants bring a different application before me, in that they now argue that the proceedings should be dismissed pursuant to UCPR r 12.7 (outline of submissions 4 February 2019) or, alternatively, that the proceedings should be summarily dismissed by reason of the absence of evidence. While the defendants formally object to the late service of the affidavit of Mr Camporeale, counsel for the defendants came armed with a comprehensive set of objections to his affidavit which he submitted meant that there was no case to answer. I have accordingly made evidentiary rulings in relation to the affidavit of Mr Camporeale and very little of it survived challenge, and this has led to the application to strike out the claim on that basis, rather than an application for adjournment.
2. It is the plaintiff who now seeks an adjournment of the hearing date (with costs be costs in the cause). No explanation is offered for the continued delay in complying with the timetable other than Mr Camporeale's ill health, which was a factor in the adjourning of the proceedings in June 2018. This application for adjournment was put in the alternative in that if sufficient of the plaintiff's case survived, the hearing should be used for the purpose of the plaintiff giving evidence and being cross-examined.

The evidence before the court

1. As noted above, the Kogarah claim has been abandoned.
2. I will first examine what the issues for determination in the Yagoona proceedings are and then consider the degree to which there is any evidence in relation to those issues. These issues are as follows: 1. What (if any) of the first defendant's work under the building contract was incomplete or defective. 2. Whether the plaintiff suffered loss and damage by reason of the first defendant's work the subject of issue (1) above. 3. What is the quantum of the plaintiff's loss and damage (if any) the subject of issue (2) above. 4. Whether the plaintiff is entitled to restitution from the first defendant in respect of any money paid pursuant to adjudication reference number 2017ADJT532, and if so in what amount.
3. Mr Russo was unable to identify what work under the building contract was incomplete or defective and how this had led to any loss or damage by the plaintiff. The quantum set out in Mr Camporeale's affidavit bears no relation to any of the issues the subject of the statement of claim. It is a completely new claim.
4. The sole issue about which there is any evidence is whether the plaintiff is entitled to restitution from the first defendant in respect of any money paid pursuant to the adjudication reference number 2017ADJT532 and, if so, in what amount.
5. The difficulty is that, beyond providing me with a large bundle of documentation, Mr Russo has been unable to take me to those issues concerning which his client is entitled to claim restitution and to explain how it is that his client seeks restitution and, if so, in what sum. The changing figures for this claim for restitution can been seen by the differences in the sums sought in the statement of claim as well as the complete lack of any relationship between either of those sums and the sum now sought in Mr Camporeale's affidavit.

The test to apply to summary dismissal at trial

1. Rule 12.7 UCPR provides: "12.7 Dismissal of proceedings etc for want of due despatch (1) If a plaintiff does not prosecute the proceedings with due despatch, the court may order that the proceedings be dismissed or make such other order as the court thinks fit. (2) If the defendant does not conduct the defence with due despatch, the court may strike out the defence, either in whole or in part, or make such other order as the court thinks fit."
2. The application was brought after my rulings concerning the affidavit of Mr Camporeale and refusing to grant leave to the plaintiff to rely upon the expert evidence attached to that affidavit. There was no cross-examination of Mr Camporeale and Mr Russo indicated that he had no further evidence to tender.
3. Essentially, what the defendants seek is a ruling that the Court should entertain a no case submission and dismiss the proceeding without the defendants being required to elect to call no evidence on the basis that the plaintiff's evidence could not sustain a finding.
4. The principles for such an application are set out in Residues Treatment & Trading Co Ltd v Southern Resources Ltd (1989) 52 SASR 54 at 68, where Perry J set out the four situations in which such an application may be made: "1. Where no reference at all to the evidence is required. 2. Where a reference to the evidence is required only to establish that there is an evidentiary hiatus or failure to adduce any evidence as to an essential element in the cause of action. 3. Where it is argued that on a consideration of the evidence adduced by the plaintiff taken at its highest from the plaintiff's point of view, the evidence could not support the causes of action pleaded. 4. The situation where it is contended that although there is some evidence to support the plaintiff's claim, it is so weak and unreliable that it should be dismissed without calling upon the defendant."
5. The evidence in this case is close to non-existent, so this application clearly falls within the first and second grounds, in which case an election as to whether to proceed is not necessary (see Tru Floor Service Pty Ltd v Jenkins (No 2) (2006) 232 ALR 532 at [24] and Wijayaweera v St Gobain Abrasives Ltd (No 2) [2012] FCA 98 at [11]).
6. The task for a judge entertaining such a submission is set out in Wijayaweera v St Gobain Abrasives Ltd (No 2) in Tru Floor Service Pty Ltd v Jenkins (No 2) at [36] - [40], and is essentially the same task as that of preparing judgment.
7. Analysis of the statement of claim and comparison of its contents with the submissions as to the quantum of damages set out in the final paragraphs of Mr Camporeale's affidavit (which are admissible as submissions only) reveals not only a total absence of evidence but the bringing of claims which have never been pleaded or particularised. There is effectively no evidence at all. I particularly note: 1. There is no evidence to support the claims of discrepancies and errors in the adjudication. It is impossible even to work out the sums involved. There is no correlation between the sum claimed in the statement of claim and the "discrepancy" of $15,780 (excluding GST) in Mr Camporeale's summary, although Mr Russo informed me that this sum relates to the amount claimed to be due to errors by the adjudicator. Even if the claim of $25,953.21 (excluding GST) for defective works and for delay costs are added in, the quantum is different to that set out in the statement of claim. 2. The bringing of a claim for liquidated damages of $160,000 is conceded to be new. The basis upon which it is claimed is unidentified and the quantum for the claim unexplained. If it is asserted to be a claim for breach of contract, the basis upon which this is claimed should be set out. 3. The statement of claim acknowledged the adjudicator made an award of $155,301.00 but any adjustment for this sum remains unexplained.
8. There are other discretionary factors of relevance to take into account in relation to the application. These include the total failure of the plaintiff to comply with any orders for the filing of any affidavit evidence and the circumstances in which the evidence in question was served during the vacation, which meant that this application effectively had to be brought on the first day of the hearing as the Court was unable to hear the application in the first week of term. This is unacceptable conduct from a plaintiff who has already been granted the indulgence of the hearing date being vacated because of Mr Camporeale's health, and where no fresh explanation is offered in relation to the continued failure to comply.
9. I am satisfied that the defendants have made out their claim for summary dismissal of these proceedings. However, the plaintiff submitted that, while it was acknowledged that there was no evidence in proper form before the Court, the order that the Court should make was the granting of another adjournment of the hearing. I set out my (alternative) findings for refusing to grant that adjournment.

The plaintiff's application for a second hearing adjournment

1. The plaintiff sought an adjournment of the proceedings in order to enable the evidence it sought to rely upon to be prepared at some future date. Given the continued ill health of Mr Camporeale, the need for affidavits in reply, the exigencies of the court's availability to hear a two-day trial, this would be delay of a substantial nature for proceedings which have already lost a prior hearing date for the same reason. Mr Russo's confident submission that the delay in question would only be for a few weeks is misconceived.
2. The circumstances in which a Court would adjourn the hearing of these proceedings in the absence of any satisfactory explanation (beyond the ill health of Mr Camporeale) given the latitude that has been displayed not only by the Court but by his opponents to date would need to be "exceptional" to use Mahony SC DCJ's words. It is of particular concern that there has already been an extensive and careful adjudication of the claims between the parties and that the sums in question, if in dispute in relation to that adjudication, appear modest, at least in light of the costs which would be incurred by not one, but two, vacated hearing dates in circumstances where the plaintiff has been the party seeking the adjournment on both occasions.
3. Taking into account the principles set out in Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175, this is a clear case where the appropriate order to make is to refuse the application for an adjournment and for the defendants' application for summary dismissal to be granted.

Costs

1. The defendants sought orders for indemnity costs on the basis that the plaintiff's delay, which resulted in the adjournment of the hearing on the first occasion and a fresh application for adjournment of these proceedings, warranted the making of orders for indemnity costs.
2. Mr Russo submitted that any order for indemnity costs should be restricted to the costs of the hearing.
3. The Court went to great lengths to assist the plaintiff when Mr Camporeale was ill. There is some force in Mr Russo's submission that the extent of the indemnity costs order should be restricted.
4. Failure to comply with court orders is regrettably common, and the Court should have some consideration for parties who are ill, or who are having trouble putting their case together. However, the circumstances in which Mr Russo delayed filing the evidence until the vacation, in circumstances where it was not possible to approach the Court for orders, are egregious and warrant the making of an indemnity costs order from that period onwards.
5. Accordingly, the costs order I propose to make is for costs to follow the event up until 18 December 2018, but for all costs thereafter, including the costs of the application before Letherbarrow SC DCJ and this hearing, to be made on an indemnity basis.

Orders 1. Proceedings 2017/367059 and 2017/367976 dismissed pursuant to UCPR r 12.7. 2. In both proceedings, the plaintiff pay defendants' costs on the ordinary basis up to 18 December 2018, and thereafter on an indemnity basis. 3. Liberty to restore in relation to any application for a gross sum costs order.

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 June 2019