Clarke v Garling & Genev & Anor [2002] NSWSC 604 | Case summary

(3) The Court may not make an order under subrule (2) without giving the plaintiff a reasonable opportunity to be heard." 4 The second defendant referred to Hoser v Hartcher [1999] NSWSC 527 were Simpson J stated: "19 It seems to me that the following principles are relevant to the exercise of the discretion to strike out for want of prosecution. The list is not intended to be exhaustive: 20 (1.) the ultimate question is whether, on balancing the prejudice to the respective parties by making or not making an order, justice demands that the action be dismissed: Stollznow v Calvert (1980) 2 NSWLR 749 at 751 F (Court of Appeal); Razvan v Berechet , unreported Court of Appeal, 23 February 1990; Vilo v John Fairfax and Sons Limited , unreported, 19 November 1995, per Sperling J; 21 (2.) the discretion should be exercised only in a clear case where it is manifestly warranted; Razvan , per Kirby P; as is generally the case with discretionary decisions, each case depends upon its own facts. Rigid formulae should not be applied to the exercise of the discretion: Stollznow v Calvert at 751 D; 22 (3.) any explanation offered by the plaintiff for the delay in proceeding must be considered: Burke v TCN Channel Nine Pty Limited , unreported, 16 December 1994, per LevineJ; 23 (4.) personal blamelessness on the part of a plaintiff (as distinct from any tardiness or other fault on the part of his/her/its legal representative) is relevant: Stollznow, p73. 24 (5.) a defendant who takes no steps to secure progress in the proceedings, or to activate an apparently inactive plaintiff or who stands by in the hope that the passage of time will ensure the quiet death of the proceedings or that the longer delay will strengthen the case for striking out, runs the risk that that very behaviour will operate to his/her/its disadvantage. A defendant has two choices: to attempt to prod the plaintiff into action, or to stand by, doing nothing, trusting that time will bring about the slow death of the action. Either choice represents something of a gamble, dependent upon future events that the defendant is unable with any degree of confidence to predict. If the defendant opts for the former course, of prodding the plaintiff into action, it may succeed in doing so, precluding an application to strike out. On the other hand, if the plaintiff remains inert, the defendant's case for striking out strengthens with passing time. If the defendant chooses the latter option and takes no action, the plaintiff may take no further steps, or may take no further steps until such irremediable prejudice is caused to the defendant that the application to strike out will succeed; if, however, some other event galvanises the plaintiff into action the defendant, having done nothing to progress the matter, can hardly be heard to complain of the plaintiff's earlier inactivity: Calvert v Stollznow , 1 April 1980, Ritchie's Supreme Court Procedure, (NSW) Vol 2, para 13, 022, per Cross J (at first instance); and in the Court of Appeal per Moffitt J, p 753; Vilo, p 10; McBride v Australian Broadcasting Corporation , unreported 6 November 1998, per Levine J; Bass v TCN Channel Nine Limited , unreported 25 July 1997, per Levine J; Hart v Herron , unreported, 3 June 1993, Court of Appeal per Priestley JA; 25 (6.) delay between the date the cause of action arose and the commencement of the proceedings may be a relevant factor: Calvert v Stollznow , per Cross J; Burke v TCN. But in my view, this circumstance must be treated with some caution. The weight that can be accorded to that delay is limited. Where an action is commenced within the period provided for by an applicable statute of limitations, it would not ordinarily be appropriate to take that period into account. However, if a plaintiff has delayed significantly in the commencement of the proceedings, and that delay is followed by further lethargy in the advancement of the proceedings, the effect of the initial (but permissible) delay is compounded. The real question is not the length of the delay, but the impact that delay has upon the defendant's capacity properly to defend the plaintiff's claim. That will be a question of fact in each case. While there may be some prejudice presumed by reason of the passage of time, much will depend upon the nature of the proceedings, and the identification of the issues involved in the litigation. Where, for example, at the close of pleadings it can be seen that there are disputed questions of fact dependent upon the oral evidence of witnesses, or their recollections, the prejudice will plainly be greater than in cases that depend essentially upon the application of legal principle to largely undisputed facts, or upon disputed questions of fact that will be resolved by reference to documentary or other objective evidence not likely to be affected by the effluxion of time; 26 (7) the onus lies on the defendant to establish any prejudice upon which reliance is placed. The disappearance or death of witnesses, the fading of their recollections, or the destruction of records, are some obvious examples of the kind of prejudice that might arise; 27 (8) prejudice to a defendant caused by delay has to be balanced against prejudice to a plaintiff deprived of an otherwise valid claim; delay in the commencement of proceedings by a plaintiff is sometimes taken as evidence contra-indicating prejudice to the plaintiff in the sense that he/she/it has evinced no interest in his/her/its own case: Burke , supra. Such an inference may be contra indicated by explanatory evidence; in this regard the plaintiff's personal responsibility for the delay is an important factor as is any explanation provided for the delay; 28 (9) what the defendant has (or has not) done by way of preparation for trial may be a factor. This is a distinct question from that concerning any steps taken (or not taken) by the defendant in prompting the plaintiff to action. A defendant who has not interviewed witnesses, taken statements or collected documents, after being served with the claim, has a less meritorious complaint about the effect of prejudice caused or presumed by reason of delay: McBride v ABC , unreported, 6 November 1998, per Levine J; 29 (10) the plaintiff's prospects of success is a relevant factor. If it appears that the prospects are minimal, the discretion is more likely to be exercised in favour of the defendant. Conversely, where the plaintiff's case is strong (absent the kind of prejudice to the defendant to which I have referred) it is less likely that justice will be done by striking the action out: Razvan, per Kirby P; 30 (11) the exercise of the discretion to strike out should not incorporate any element of punishing a tardy plaintiff, or of excluding one who may appear to have some unworthy characteristics: Razvan , per Kirby P. The ultimate aim of a court is the attainment of justice: The State of Queensland v J L Holdings Pty Limited (1997) 189 CLR 146. To adapt the words of the High Court in that case, discretions such as that presently invoked ought not to be used to supplant the overall aim of the attainment of justice." 5 This analysis has been adopted by Levine J in Gill v Eatts & Ors (1999) Aust Torts Reports 81-529. I respectfully agree that this is a most helpful analysis. 6 The issues that are left in this case to be decided are what duties arise from the relationship as landlord and as tenant of the premises and whether either party is entitled to an indemnity from the other or whether the damages should be apportioned and if so in what amounts. 7 However the second defendant submitted that it suffers both presumed and actual prejudice and that the tenants' cross claim against it should be dismissed. Elsa Hill is a director of Pambula Pty Limited, the landlord of the premises. She is 76 years of age and will not be able to give evidence at any future hearing due to her ill health. On 18 March 2002 the second defendant's solicitor had a telephone conversation with Mrs Hill who stated that her health is poor due to a heart condition and she would not be physically fit enough to give evidence. On 19 March 2002 the second defendant's solicitor had a telephone conversation with Dr Peter Hulak Mrs Hill's general practitioner. He stated that Mrs Hill would not be medically fit to give evidence due to her heart condition. During that conversation of 18 March 2002 she said that she has a recollection of the proceedings brought against Pambula in relation to an accident which occurred in 1992 at Pambula's premises. However the medication she is taking affects her memory. It was conceded that it was likely that Mrs Hill provided a statement to Pambula's solicitor at the time of the accident. Such statement can be admitted into evidence. However Pambula's counsel submitted that as Mrs Hill cannot be cross examined her statement would be given less weight than had she been able to attend court. 8 Further on 18 March 2002 the second defendant's solicitor had a telephone conversation with Mr Donald Kramer the former managing agent of the premises who stated that a lot of water has passed under the bridge since then and he did not really remember much about the accident now. However his file is in existence. This contains notes as to the identified repairs needed to be carried out and inspections made during the relevant period (Ex A). 9 The file notes show that on 25 May 1991 the premises were inspected and they identified some work that needed to be taken but that work did not involve the front entrance. In March 1992 the agent wrote to Mrs Hill informing her of the items on the property that needed attention. There was no mention of the front entrance area. There is some other correspondence between the tenants and the agent including diary entries. 10 Also on file is a letter dated 16 June 1992 (after the accident) where Mr Garling wrote to the agent saying "in case she is not fully aware of the areas of concern - I have listed them below - ". Identified for the first time are the absence of safety railings around the void at the front entrance, dangerous step due to the verandah beams dropping and no workable lighting at the front entrance. Mr Garling also states that as he had mentioned before he was happy to carry out carpentry repairs for a reasonable price. Again on 3 July 1992, Mr Garling wrote to the agent stating that "As it was only after weeks of non-payment that any action was taken on your part to commence any form of repairs - I feel it would seem silly for me to send you a cheque while the agreed repairs are only half completed, with at this stage, a questionable degree of success. The amount of this payment I feel should also be relative to our continuing endurance of these repairs being carried out by your tradesmen in our home over the previous weeks. Finally, let me say for what it's worth, that I am disillusioned with your continuing lack of care as to the dangerous conditions at the entrance to the house." From this correspondence it seems that the tenants corresponded with the agent who in turn spoke to Mrs Hill about the long outstanding repairs to the premises. 11 In October 1997, after Levine J took evidence on commission in London His Honour directed the parties to organise the matter to be mentioned before him, with the list judge Barr J or His Honour's associate after 24 November 1997. Neither party complied with this direction. On 20 November 1997 Dr Registrar Haggett entered judgment in favour of the plaintiff against the first defendants in the sum of $2.25 million, and judgment in favour of the plaintiff against the second defendant in the sum of $2.25 million. 12 In 1998 the solicitors acting for the defendants exchanged correspondence concerning discovery and interrogatories. This exchange ceased on 30 June 1998 when the solicitors for Pambula Pty Limited wrote to the solicitors for the tenants stating that their client considered it imperative that the cross claim proceed without further delay and requested that the consent orders be signed in relation to discovery and interrogatories. No reply was received and nothing happened for 3½ years. On 26 September 2001 the tenants' solicitors wrote to the landlord's solicitors requesting a conference to settle their respective liabilities. 13 Both parties had fully prepared their cases for hearing in London in 1997. There are photographs of the premises taken a few weeks after the accident which were marked as exhibits in this hearing. Mr Buckland, an engineer, inspected the premises on 14 July 1992. There is transcript available of the hearing which lasted over 10 days. Mrs Clarke, a witness present at the time of the accident gave her recollection of events during and after the accident. Ms Sarah Genev, Mr Christopher Martin, Mr Phillip Buckland and Mr James Toomey have indicated that they would all be available to give evidence. 14 If the first defendant's cross claimant is dismissed, the first cross defendant will be prejudiced as it will have no right to indemnity and contribution should the second defendant decide to pursue its claim. The second defendant's cross claim, which arises from the same facts and circumstances, would proceed yet the first defendant would be denied its rights under their cross claim. 15 The cause of action arose 10 years ago. Indisputably memories of witnesses will have faded with the effluxion of time. Some of these memories have been captured earlier in time in the form of statements and photographs. It is important to appreciate that it was both parties who were inert for 3½ years. After taking into account these matters, it is my view that justice is best served if the cross claims remain on foot. I dismiss the motion. As the motion has brought about the reagitation of the cross claims, the appropriate order for costs in my view is that costs be costs in the cause. I direct that this matter be listed for a status conference. The court is to notify the parties of the date and time of such conference. 16 The court orders:

Clarke v Garling & Genev & Anor

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