Cooper & Anor v Sztainbok [2009] VSCA 73

Court of Appeal (Vic)|2009-04-03|Before: KELLAM AND DODDS-STREETON JJA

APPLICATION - Leave to file and serve notice of appeal out of time - Explanation for delay - Prospects of success - Prejudice to respondent.

1 I agree with the reasons given by Dodds-Streeton JA.

3 His Honour ordered that there be judgment for the respondent, Olga Sztainbok, the plaintiff below. The respondent had applied for specific enforcement of the written terms of settlement ('Head of Agreement') dated 26 July 2007 entered between the respondents and the applicants at mediation to compromise the respondent's proceeding.

There be judgment for the plaintiff pursuant to the Heads of Agreement made between the plaintiff and the first and second defendants and dated 26 July 2007 and declares that the compromise of the proceeding constituted by the said Heads of Agreement be specifically performed.
By noon on Monday 22 December 2008 the first and second defendants deliver to the solicitors for the plaintiff, duly signed by them, the Application for Certification (Form 1) under the Subdivision Act 1998, which Application for Certification was provided to the first and second defendants by the plaintiff's solicitors in October 2007 and a copy of which is Exhibit MML6 to the affidavit of Margaret Mary Leech sworn 18 April 2008.
The first and second defendants, within seven days of the solicitors for the plaintiff giving them form signing an Application for Approval of Plan of Subdivision (being the Plan of Subdivision in Exhibit BM4 to the affidavit of Brian Moxham sworn 16 May 2008), sign and deliver to the solicitors for the plaintiff the said Application for Approval of Plan of Subdivision.
The first and second defendants, within seven days of the solicitors for the plaintiff giving them for signing a Transfer of Land necessary for lodging with Land Victoria to implement the change to the title boundary agreed to in the said Heads of Agreement and depicted in the said Plan of Subdivision, sign and deliver the said Transfer of Land to the solicitors for the plaintiff.

The learned trial Judge erred in concluding that the Plan of Subdivision in Exhibit BM4 to the affidavit of Brian Moxham sworn 16 May 2008 accorded with or accurately implemented the Plans annexed to the Heads of Agreement entered into by the parties on 26 July 2007.
The learned trial Judge failed to give any effect or content to the 'Best Endeavour Clause' or statement contained in the Heads of Agreement dated 26 July 2007.
The learned trial Judge erred in ordering specific performance in circumstance [sic] where the respondent had failed to comply with the Heads of Agreement by providing Terms of Settlement that included additional or extraneous terms and conditions and the respondent has failed to provide Terms of Settlement accurately reflecting the Heads of Agreement.

6 The applicants and the respondent own adjoining pieces of land situated at Carrum. The respondent claimed a portion of the applicants' land fenced within her land on the basis of adverse possession.

8 Prior to a trial scheduled for August 2007, on 26 July 2006 the parties attended a mediation and following difficult negotiations agreement was reached and set out in a Heads of Agreement signed by the parties in the presence of their legal advisers.

9 The Heads of Agreement attached two copies of a survey of the applicants' land prepared in 2002 by Mr Moxham, a surveyor engaged by the applicants. It showed buildings which were demolished in 2004 when the applicants rebuilt and erected a new residence and fence.

The common boundary between the properties of the respective parties where the brick wall exists will be the northern line of the wall (the wall boundary).
The existing fence which is situated north of the wall boundary will be removed by the Defendants at their expense.
The wall boundary will be rendered by a contractor selected in accordance with clause 11 at the expense of the Defendants.
The balance of the common boundary will be on the line of the 'Palings' shown on 'Plan of Feature Survey' Version 02 of B. Moxham. The existing paling fence will be moved where necessary to the 'Palings' line at the expense of the Defendants. Such fencer to be chosen in accordance with clause 11 (the Palings boundary).
The Plaintiff will bear the cost and expense of having the above agreement/terms surveyed together with the relevant Titles Office costs of rectification of title boundaries.
The Defendants will pay the Plaintiff's costs of this proceeding agreed at $25,000 in 60 days.
Best Endeavours Clause.
Terms of Settlement and Releases to be drawn up.

Dated 26/7/07

(signed)

_________________________________

Plaintiff

(signed) (signed)

_________________________ _________________________

Defendants

Rendering and Relocating to be completed in 60 days of acceptance of quote and contractor subject to availability of contractors.
The paling fence will be relocated and refixed according to the same specifications at present at the road end.

ie 1 600 ml concreted in.

2 Posts every 1.8 mts.

3 Red Gum Posts.

The rendering and relocating contractors will be Ⓐ chosen by the following system: each of the parties will obtain 2 quotes and then choose the quote closest to the average in the event of not agreeing on the contractor. Ⓑ independent of the Defendants. Ⓒ the plaintiff has the right to choose a more expensive quote on the condition she pays the difference between the 'average quote' and the quote she chooses.
If the Defendants fail to comply with these Terms, the Defendants agree that the Plaintiff will be entitled to have the Proceedings reinstated and obtain judgment against the Defendants and an order for specific performance of these Terms of Settlement together with the Plaintiff's costs of enforcing these Terms on a solicitor and own client basis.

2 For the purposes of obtaining a judgment pursuant to the provisions of the preceding paragraph, the Defendants agree that

(a) The Terms may be produced to the Court as the Defendants' consent to such a judgment; and

(b) That affidavit/s by the Solicitors acting for the Plaintiffs will be sufficient evidence of any failure on the part of the Defendants to comply with these terms.

the paling fence erected by the defendants in 2004 as part of their redevelopment works was to be relocated a short distance south; this was south of the title boundary.
the line established by the brick wall of the defendants' new buildings was to constitute the common boundary in the area covered by the wall boundary. This boundary was on the northern side of the line of the old paling fence removed by the defendants and thus represented a gain to the defendants from that line; it was, however, still south of the title boundary.[1]

12 Following the mediation, the respondent's solicitor asked Mr Moxham to prepare documents required to implement the Heads of Agreement. Mr Moxham advised that the change to the title boundary required a Plan of Subdivision to be prepared, together with an Application for Certification.

13 Mr Moxham prepared a Plan of Subdivision (version 1), a variation showing existing fencing and proposed new fencing marks (version 1A) and an Application for Certification which in mid-September 2007 he gave to the applicants. They indicated that they would sign it and paid the agreed costs.

14 Following receipt of correspondence from the applicants' solicitors, in December 2007 the applicants advised that they would not sign the Terms of Settlement, as they differed from those signed at mediation. The applicants then requested certain amendments and in January 2008 Mr Moxham drew an amended Plan of Subdivision (version 2) reflecting the two changes sought by the applicants.

15 During the course of negotiations, the applicants required further amendments, as a result of which Mr Moxham drew up versions 2, 3 and 4 of the Plan. The applicants were prepared to proceed with the Application for Certification and Plan of Subdivision on the basis of version 4. The respondent insisted that version 1 was in accordance with what was agreed at mediation and ultimately applied to enforce the agreement.

16 Before his Honour, the applicants deposed that version 1, 1A, 2 and 3 did not accurately record what was agreed at mediation. They also relied on the alternative plan of a licensed surveyor, Mr Kenter, which allegedly gave 'practical effect' to the Heads of Agreement in a way which was more favourable to the applicants than under version 1 or 1A.

17 In essence, the applicants complained that under version 1 or 1A, they would have to remove existing features such as a brick wall and air conditioning conduits but no allowance for the costs of such repositioning had been made.

18 His Honour set out his conclusions at paragraphs 57 to 65 of his reasons for judgment.

The question is whether, as the plaintiff contends and the first and second defendants deny, Mr Moxham's Version 1 accurately implements the agreement. I accept that it does, and that Version 4 and Mr Kenter's plan do not. Indeed I regard Mr Kenter's plan as an exercise in poetic licence, seeking to assist the first and second defendants to an implementation of the agreement as they would now like it to be. In my view the intendment of the agreement is clearly enough to be seen, and as seen is reflected in Version 1.

The first and second defendants' submission on interpretation seems to me to founder at several points. The submission relied on the allegation that the parties were aware of the existence of certain features or matters when they entered into the agreement. That is an allegation of fact as to which I have already made some observations. The next step was to say, as an assertion, that those features must be taken into account with the effect of pushing the first and second defendants' boundary to the north into the plaintiff's land. But the extent of that alteration to the agreed boundary line was not specified and somehow was to be determined by a surveyor or further agreement of the parties. Even more basically than that however, the premise of the submission - that existing features "must be taken into account" by adjusting the agreed line - was an assertion without a factual foundation. The acceptance of the assertion would involve the Court acting on a guess or speculation, in my view.

I do not accept that the absence of reference to the removal of the features in question reflected an intention that those items remain as they were at the time. I do not repeat the above discussion concerning the items and the plaintiff's awareness of them. Further, far from confirming the first and second defendants' counsel's submission, the absence of reference to any such removal is equally consistent with an acceptance by the parties of the new agreed boundary line with whatever consequence might follow to each of them. The fact of the new boundary line did not automatically mean that any feature of the first and second defendants' land found across that line had to be removed, or vice versa for that matter, as the parties could work out how to deal with the situation. What the agreement did was settle on the boundary.

In my view, an agreement was made which with sufficient clarity determined upon a new boundary line and which boundary line is faithfully implemented in Mr Moxham's Version 1. In truth, in my view, the first and second defendants have sought to renegotiate the agreement. The attempt is rejected and, considering it appropriate to do so, I will make orders for the enforcement of the agreement. I will hear the parties on the terms of the orders and costs.[2]

20 The principles governing the grant of an extension of time are usefully set out in the respondent's outline as follows:

Court of Appeal may extend time for filing and serving Notice of Appeal pursuant to Order 64.03(1) and (2).
Whether to extend the time is in the discretion of the Court.

The delay must be explained and reasons advanced to justify the delay being excused.

Picken v. The Shire of Alexander (1890) [sic] 16 VLR 309 pages 309, 311 and 312.

The chances of the appeal succeeding if an extension of time is granted is a relevant matter.

Hughes v. National Trustees [1978] VicRp 27; (1978) VR 257 pages 258 and 264.

The time for appealing will not be extended where the appeal if brought would clearly fail. It is not just to a respondent to allow a judgment to be appealed that is plainly right. Ford v. LaForrest [2001] QCA 455; (2002) 2 QdR 44.

Another relevant matter is the litigants achieving finality of judicial determination (Hughes' case page 263).
Another matter is the conduct of the appellant (Hughes' case page 263). "The conduct of the applicant may here be relevant. Obviously an applicant is less likely to be granted an extension of time where he had indicated that he proposes not to appeal and that indication has been acted on ..."
Prejudice to the respondent is a matter that is relevant. "When the time has been allowed to elapse that gives the Defendant a vested interest in the judgment and this vested interest ought not to be disturbed unless there is some good reason for disturbing it" (Hughes' case page 263).[3]

21 The principles relevant to a grant of an extension of time in which to file and serve a notice of appeal were summarised by McHugh J in Gallo v Dawson as follows:

The discretion to extend time is given for the sole purpose of enabling the court or justice to do justice between the parties: see Hughes v National Trustees Executors & Agency Co of Australasia Ltd [1978] VicRp 27; [1978] VR 257 at 262. This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time: see Avery v No 2 Public Service Appeal Board [1973] 2 NZLR 86 at 92; Jess v Scott (1986) 12 FCR 187 at 194-5; 70 ALR 185. When the application is for an extension of time in which to file an appeal, it is always necessary to consider the prospects of the applicant succeeding in the appeal: see Burns v Grigg [1967] VicRp 113; [1967] VR 871 at 872; Hughes, at 263-4; Mitchelson v Mitchelson (1979) 24 ALR 522 at 524. It is also necessary to bear in mind in such an application that, upon the expiry of the time for appealing, the respondent has a 'vested right to retain the judgment' unless the application is granted: Vilenius v Heinegar (1962) 36 ALJR 200 at 201. It follows that, before the applicant can succeed in this application, there must be material upon which I can be satisfied that to refuse the application would constitute an injustice.[4]

22 In Luxmore Pty Ltd v Hydedale Pty Ltd, Maxwell P and Kellam JA stated:

The interests of justice will almost always require that an extension of this kind be granted where there is an explanation for the non-compliance and there is no irremediable prejudice to the other party. Of course there will be circumstances in which the appeal is so obviously hopeless that the Court could be satisfied that the extension would really be futile.[5]

23 Ms Leech, of the respondent's solicitors, deposed that on 21 December 2008 the applicants forwarded the signed Application for Certification to her, which she forwarded to Mr Moxham to submit with the Plan of Subdivision. The Plan had thus been certified and could now be lodged at Land Victoria if the applicants complied with Order 3 of the Trial Judge's orders. The applicants, it was said, had acted on the basis of his Honour's orders rather than seeking a stay, which was inconsistent with their appeal.

24 Ms Leech deposed that the respondent had incurred expenses of $580 after the judgment in instructing Mr Moxham to process the application.

25 Ms Leech further deposed that following the mediation, she prepared a draft terms of settlement incorporating the amendments requested by the applicants' then solicitor. The applicants were thereafter self-represented for some time. On 12 December 2007, she sent them a typed version of the Heads of Agreement signed in mediation, stating that the respondent would be prepared to proceed on the basis of it. She received no response and in further correspondence, the applicants did not refer again to the issue of the Terms of Settlement.

26 The affidavit of the first applicant deposed that after judgment was delivered on 18 December 2008, the applicants' solicitors, Hills Legal, closed for the Christmas break. The applicants received a copy of the judgment 'during the Christmas break'. Their solicitor's office reopened on 5 January 2009. The applicants could not arrange an appointment with their solicitor until 12 January 2009. The applicants then discussed with the solicitor a 'without prejudice' letter from the respondent.

27 On 19 January 2009 (the date on which time to file a notice of appeal expired) the first applicant gave instructions to brief senior counsel. There was a conference with Mr Glick QC on 22 January 2009 and the applicants instructed that a notice of appeal be prepared and filed. On 12 February 2009, a draft notice of appeal was received from Mr Lithgow of counsel. On 16 February 2009, the applicants' solicitor returned to his office from a trip to Burma. On 20 February 2009, approximately nine weeks after the delivery of the judgement, the applicants' summons seeking an extension of time was filed.

28 The first applicant, Mr Cooper, deposed that he believed that the respondent would suffer no prejudice or disadvantage should leave to lodge a notice of appeal out of time be granted. There was an adequate boundary fence in place and the ultimate effect of the judgment below was to require a future amendment to title dimensions and realignment of a paling fence (by a small amount).

29 In the present case, the applicants had until 19 January 2009 to file and serve a notice of appeal. The chronology and the matters advanced by the applicants do not, in my opinion, provide a meaningful explanation for the failure to file and serve the Notice of Appeal within time. The explanation rises no higher than reliance on the legal vacation which is specifically allowed for in the Rules. The applicants, on any view, had a copy of the reasons for judgment and had a conference with their solicitor by 9 January 2009 and a conference with senior counsel on 22 January 2009, by which time it must have been apparent that the time to file a notice of appeal had already expired, but no action was taken forthwith. On the basis of the material before it, this Court is left to wonder why that was so.

30 Ground 2 of the notice of appeal (failure to give effect to the best endeavour's clause) is, in my opinion, hopeless. The best endeavours clause (item 7 in the Heads of Agreement) simply states 'Best Endeavours Clause'. No argument on that clause was raised before his Honour and there is no discernable basis on which the applicants should be permitted to raise it on appeal. Ground 2 of the notice of appeal is cast in very general terms and does not point to any specific error by the trial judge.

31 The applicants' prospects of success on ground 3 in my opinion are minimal. The applicants at trial did not lead any evidence attacking version 1 and did not address the evidence of Mr Moxham. His Honour considered the relevant issues comprehensively and analysed them in meticulous detail. His Honour's conclusions were, in my opinion, persuasive and any challenge to them based on alleged factual error has particularly poor prospects of success.

32 While the applicants submitted that an extension of time would occasion little prejudice to the respondent, the respondent incurred some additional expense in forwarding the relevant applications. The respondent would also lose her vested right to retain the judgment.

33 In determining whether injustice would result from the refusal of an extension, the history of the proceedings, the conduct of the parties and the nature of the litigation are relevant.

34 The litigation in this case was an application to enforce a Heads of Agreement entered into at mediation in order to settle the primary dispute. Following the execution of the Heads of Agreement, the respondent stood ready to implement the Heads of Agreement on the basis of Mr Moxham's version 1, but the applicants, having dispensed with their solicitors, proposed three successive amendments. While having initially objected that the terms of settlement did not conform to the agreement, they did not respond to the letter offering to sign the typed form of the Heads of Agreement and did not repeat their initial assertion in subsequent correspondence. The negotiations continued from 26 July 2007 to 22 May 2008. The history of the proceedings indicates lengthy negotiations in order to avoid litigation, but that approach was unsuccessful.

35 The applicants were also directed to file and serve an affidavit by 25 February 2009 but did not do so until 5 March 2009.

36 A determination of whether to grant an extension of time involves a discretion conferred to do justice between the parties. The matters relevant to that fundamental question are not immutably fixed. Although the authorities recognise many relevant considerations, no single factor is necessarily decisive. In the present case, no satisfactory explanation for the failure to comply was advanced. Indeed, even after a conference with senior counsel when the notice of appeal was already out of time, no action was taken for almost a month. The proposed grounds of appeal are either hopeless or have minimal prospects of success. The history of the matter and the nature of the proceeding reveal lengthy but unsuccessful negotiations in relation to the settlement reached on 26 July 2007 in mediation. Nine weeks elapsed between the delivery of the judgment and the service of the summons. The applicants have not sought a stay. The respondent would lose her vested right to retain the judgment if the time to file and serve a notice of appeal were extended. Although prejudice to the respondent would not be otherwise irremediable, in my opinion, in all the circumstances, the application should be dismissed.

[1] Sztainbok v Cooper [2008] VSC 577, [11].

[3] Respondent's outline of submissions, filed 13 March 2009, p 1-2.

[5] [2008] VSCA 212, [3] (citations omitted).

At a glance

Court

Decision date

Before

Source

Judgment (54 paragraphs)

Parties

Cases Cited (5)