Fenwick v Wambo Coal Pty Ltd

Judgment 1HIS HONOUR : On 13 October 2010 these proceedings were set down for hearing before me for five days commencing 11 April 2011. The proceedings were commenced by a statement of claim filed on 30 November 2009. The plaintiff claims to be entitled to a right of way over land of the defendant in the Hunter Valley. The defendant is a mining company. The plaintiff alleges that he and the defendant agreed to vary the location of and to extend the right of way. He seeks orders, amongst others, that the defendant co-operate with him to take all necessary steps to have the varied right of way recorded in the register. The plaintiff seeks an injunction to restrain the defendant from obstructing access to the right of way. He also claims that the defendant is required to remove, replace and maintain a crossing over South Wambo Creek on which the right of way passes. 2On reviewing the file I observed that no defence had been filed. Moreover, JusticeLink recorded that the defendant had filed a submitting appearance, although a signed submitting appearance was not on the file. On 9 February 2011 my associate wrote to the parties to arrange for the matter to be listed for further directions or final orders as might be appropriate. 3The matter came before me on 18 February 2011. I was informed that the defendant had not filed a submitting appearance. The signed notice of appearance on the court file is not a submitting appearance. It appears from subsequent inquiries made by my associate that the entry on JusticeLink was due to a data processing error by a clerk in the registry. However, no defence had been filed. 4On 18 February 2011 the defendant was given leave to file in court a notice of motion by which it sought leave to file a defence and cross-claim. Those documents were annexures to an affidavit of the defendant's solicitor, Mr Peter Meades, sworn on 17 February 2011. The notice of motion and affidavit had only been served on the plaintiff the previous day. The notice of motion was stood over to 3 March 2011, being the earliest available day. 5On 3 March 2011 I gave the defendant leave to file an amended notice of motion. The defendant now seeks to review a decision made by Registrar Walton on 13 October 2010. On that day the learned Registrar refused an oral application by the defendant for an extension of time for filing a defence and cross-claim. The defendant seeks an extension of time for its application to review the Registrar's decision. 6The defendant has been guilty of exorbitant delay. The plaintiff commenced proceedings by a detailed statement of claim. He also served an affidavit of 146 paragraphs that is a detailed statement of his evidence in chief. The statement of claim, the plaintiff's affidavit in support of the statement of claim, and the exhibit to the plaintiff's affidavit, were served on the defendant by registered post on 2 December 2009. 7On 13 January 2010 the plaintiff provided to the defendant a schedule of documents of which it sought discovery. 8The defendant filed its appearance on 22 January 2010. Under the rules its defence was due 28 days after service of the statement of claim or such other time as the court might direct (Uniform Civil Procedure Rules, r 14.3(1)). The time for making a cross-claim was the time limited for filing a defence (Uniform Civil Procedure Rules, r 9.1(1)(a)). 9The first return date was 26 February 2010. On that day the Registrar, over opposition of the defendant, ordered that the defendant file and serve its defence by 9 April 2010. Both parties were ordered to provide verified discovery by 23 April 2010. Inspection of discovered documents was to take place by 30 April 2010. 10The defendant did not comply with those orders. On 10 May 2010 the Registrar made orders by consent. The time for the defendant to file its defence and any cross-claim was extended to 31 May 2010. The Registrar noted that the parties agreed that the matter should be referred to private mediation to take place before 5 July 2010. The matter was relisted for 5 July 2010. 11The defendant did not file or serve a defence or cross-claim in compliance with the order of 10 May 2010. Mediation did not take place at that time. On 5 July 2010 when the matter was again listed for directions, the Registrar made orders (not by consent) that the defendant was to file its defence by 13 August 2010. The Registrar's orders note that " Mediation to take place on before 24/25 August 2010 ". The matter was stood over to 26 August 2010. 12The parties attended a mediation on 25 and 26 August 2010. The defendant had still not filed its defence, although a defence was obviously an important document for the purposes of the mediation. The mediation was not concluded. On 26 August 2010 the Registrar made further orders by consent. The orders made were that the defendant file its defence on or before 3 September 2010, and serve its list of documents for discovery and its evidence by 6 October 2010. 13Again, the defendant failed to comply with those orders. 14The mediation concluded on 27 September 2010. It was unsuccessful. 15On 13 October 2010 the matter again came before the Registrar. Counsel for the defendant sought a further extension of time for the filing of a defence and for the filing of a cross-claim seeking orders under s 89 of the Conveyancing Act 1919 for the extinguishment of the right of way. The application was unsupported by any affidavit evidence to explain the delays, which were already exorbitant. According to a filenote of a Mr Nicholas Rozenberg, a solicitor employed by Maddocks Lawyers, the solicitors for the defendant, the Registrar rejected the defendant's proposed orders and listed the matter for hearing. On 13 October 2010 Mr Rozenberg advised his supervising partner, Mr Meades, that " to file a defence/cross-claim and further orders (for instance, evidence etc), we will need to put on a notice of motion. Please let me know when we should start on this. " 16No notice of motion to review the Registrar's decision, to seek leave to file a defence and cross-claim, or to extend the time for the service of evidence and giving of discovery, was made until the notice of motion seeking leave to file a defence and cross-claim was filed in court on 18 February 2011. As at the hearing on 3 March 2011, the defendant had still not served any affidavits. It led no evidence that it had complied with the orders for discovery. 17The defendant's solicitor, Mr Meades, deposed that: "Whilst it may appear at first that the delay to date has been considerable, the ability to properly plead to the statement of claim has required the need to examine a complex number of issues and interview a number of people regarding events that date back to 1915." 18It does not only " appear at first " that the defendant's delay has been considerable. The delay is exorbitant. 19Mr Meades deposed that prior to the first directions hearing on 26 February 2010, extensive instructions were taken regarding the background to the proceedings. This was not the first time the defendant had had to consider issues regarding the right of way. The plaintiff seeks to enforce an agreement he alleges was entered into in 2002. The defendant had investigated the issues raised by the plaintiff concerning the right of way in at least 2001 and 2002. On 7 March 2001, a Mr Robin Hopps, project manager for the defendant, advised the plaintiff that, " We have completed our research into the right of way issue ". 20Mr Meades deposed that counsel was briefed in March 2010. He deposed that in about April 2010 a large quantity of documents were produced by means of subpoenas issued by the plaintiff. This included material produced by the Singleton Shire Council, the Department of Lands, and the defendant's former solicitors. It should be noted that it was the plaintiff, not the defendant, who issued the subpoenas. 21Mr Meades deposed that the documents produced on subpoena were " critical to the factual content of the defence ". He deposed that in late April 2010 he and counsel attended the defendant's premises to investigate " a number of the allegations pleaded in the statement of claim" . This was about five months after service of the statement of claim. The orders of 10 May 2010 extending the time for the defendant to file its defence and any cross-claim to 31 May 2010 were made by consent. The defendant and its legal advisers must by that time have known what was required in order to prepare the defence and any cross-claim. Mr Meades deposed that as further work on the large quantity of documents produced in around April 2010 progressed, it became clear by June 2010 " that further information was required before the defence could be finalised with any confidence as to accuracy of a number of facts set out in the statement of claim ." He deposed that, " That work was progressed and further analyses conducted to enable the defence, which needed to address certain issues from 1915 onwards, to be accurately prepared. " 22The evidence as to the work done was given at a very high level of generality. Mr Meades did not say how much time was spent in preparing the defendant's case. He did not say who was interviewed, nor describe with any particularity what documents were inspected, or what further documents if any were thought to be required. He gave no real explanation as to why the defendant could not comply with the orders. 23Mr Meades deposed that he appeared at the directions hearing on 5 July 2010 and advised the court that: "(a) that there has always been an intention for the Defendant to file a full and complete defence; (b) that the delays in filing a defence were largely due to the factual complexity of the matter, the relevant facts spanning a significant period of time; and (c) that, to date, the plaintiff's legal representatives had indicated that their paramount priority was for a mediation and that the filing of a defence was a lesser concern." 24The plaintiff's position was that it required a defence to be filed so it would know the defendant's position before the mediation. The court made an order accordingly. The Registrar ordered the defendant to file its defence by 13 August 2010. The mediation was to take place on 24 and 25 August 2010. Mr Meades deposed that: "The work on the defence continued, in particular the establishment of facts that could allow a denial to a number of the claims asserted. That however was not concluded within the time of the court order although I had [an] outline prepared intending to discuss that at the forthcoming mediation." 25Again, no particulars are provided of the asserted difficulties in establishing relevant facts. It is not surprising, given the defendant's continual default, that the mediation was unsuccessful. 26Further orders were made on 26 August 2010 for the defendant to file and serve its defence, to give discovery and to serve its evidence. None of those orders was complied with. Mr Meades deposed that: "Given the opportunity to resolve the matter that the mediation presented I did not pursue the finalisation of the draft defence that had been prepared. Much time was taken up advising on the potential settlement and awaiting instructions which I am informed required a number of internal senior employees of the defendant considering the matter." 27Mr Meades deposed that following the directions hearing on 13 October 2010: "[W]ork continued on both the defence and cross-claim in order to apply for leave at the same time regarding both pleadings. The work on the cross-claim took longer than I anticipated. I was not in a position to provide the pleadings to the defendant until December at which time, given the significance of the matter to the defendant, I am informed that an internal decision as to whether to proceed on the cross-claim required time." 28Thus it seems that by December pleadings had been prepared. This was a year after the statement of claim had been served. 29Witnesses had been interviewed in April 2010. Mr Meades deposed that in November 2010 he, together with his employed solicitor, Mr Rozenberg, and counsel, interviewed an historian for the purposes of ascertaining information relating to the village of Warkworth and surrounding properties. Mr Rozenberg inspected further documents at Singleton Shire Council, the Singleton Public Library and the Singleton Historical Society between 3 and 4 November 2010. The defendant received further documents from the council on 24 November 2010. Mr Meades gave further evidence of telephone conversations and conferences with local historians. 30Mr Meades also deposed that, " On around 16 November 2010 Mr Rozenberg attended on site at the Wambo mine to review documents in its possession that might be relevant to the proceedings ." 31There was no explanation as to why all documents at the Wambo mine had not been reviewed months earlier. The defendant had been obliged to give discovery by 23 April 2010. 32Mr Meades deposed that on around 14 December 2010 he and counsel met with Mr Robin Hopps, the former deputy general manager employed by the defendant. Mr Hopps was the author of correspondence with the plaintiff in 2001 and 2002 on which the plaintiff relies. It was he who advised the plaintiff on 7 March 2001 that the defendant had completed its research into the right of way issue. If this was the first time Mr Hopps was interviewed (and Mr Meades' evidence does not descend to such particularity), there is no explanation as to why it took over a year after service of the statement of claim for that interview to take place. 33Even though draft pleadings were prepared and submitted to the defendant in December 2010, it was not until 17 February 2011 that the proposed defence and cross-claim were made available to the plaintiff by being annexed to Mr Meades' affidavit of that date. That was the day before the matter was listed before me. 34Mr Meades deposed: "61 I believe that the Defence narrows the issues in dispute significantly, namely to the following: (a)Whether the absence of the right of way granted under memorandum of transfer dealing number A154688, dated 13 January 1915 ( Disputed Right of Way ), from the certificates of title for the land burdened by the right of way in dispute, being lots 82 and 83 of Deposited Plan 548749, deprives of the Plaintiff of any entitlement to the Disputed Right of Way; (b)Whether there is any agreement between the plaintiff and defendant and/or any representations by the defendant that vary the original grant of the Disputed Right of Way under dealing A154688; (c)Whether there are any obligations on the part of the defendant to maintain the Disputed Right of Way. 62 I believe that the delay in the defendant filing the Defence has been due in large part to the following: (a) the complexity in ascertaining an accurate and detailed chronology of the facts: (i)in and around 1971 that led to, and followed, the absence of the disputed right of way from the certificates of title for lots 82 and 83 of Deposited Plan 548749; (ii)in and around the period 2000 to 2002 to determine the Defendant's position as to whether the disputed right of way has been varied by agreement of the representations and/or conduct of the Defendant; and (iii)necessary to determine the Defendant's position as to whether an obligation to maintain the disputed right of way arises; and (b) the Plaintiff's statement of claim seeking a broad and extensive range of relief under a variety of causes of action. ... 64 The Cross Claim applies to extinguish or modify the Disputed Right of Way pursuant to s89 of the Conveyancing Act 1919 (NSW). 65 I believe that the delay in the Defendant filing the Cross Claim has been due to the following: (a) the need to provide a well particularised cross-claim, which requires a detailed knowledge and dissemination of: (i)the history of the use of the Disputed Right of Way between 1915 and the present; (ii)the change in the use and ownership of the Plaintiff's land between 1915 and the present; and (iii)the change in the neighbourhood between 1915 and the present, including the neighbouring properties, local roads and tracks (including their change in condition, quality and legal status), the local village, and local industries." 35The proposed cross-claim would join three other persons as cross-defendants. Although not pleaded in the proposed defence or raised by Mr Meades, counsel for the defendant submitted that an answer to the plaintiff's claim that he and the defendant had agreed to vary the right of way was that other persons (namely, Mr and Mrs Brosi and Ms McLaughlin) were entitled to the benefit of the right of way said to have been varied (if that right of way exists) and they were necessary parties to the proceedings. 36I do not know what Mr Meades means when he says that the defence " narrows the issue in dispute significantly ". He did not attempt to explain what wider issues were in dispute. 37The defence does not admit that the plaintiff's land presently has the benefit of a right of way over lots 82 and 83 in Deposited Plan 548749 (being land owned by the defendant), although the reason for that contention is not pleaded. It appears from Mr Meades' affidavit and from correspondence from the defendant of 23 October 2008 and 19 February 2009 that the defendant relies upon the fact that the certificates of title for those two lots do not state that they are subject to an easement for the benefit of the plaintiff's land. That however is not pleaded. 38The plaintiff's statement of claim did not come out of the blue. It arose from the correspondence written by the defendant on 23 October 2008 and 19 February 2009 by which the defendant appears to have resiled from the position it took in 2001 and 2002. The plaintiff responded to the defendant's correspondence of 23 October 2008 by accusing the defendant of not having made a proper attempt to investigate the history of the dispute or the documentation relevant to it. The defendant could be expected to have done so before writing its letter of 23 October 2008, given that it there asserted that the plaintiff did not have the benefit of the northern right of way because it was not recorded on the titles to two of the northern lots. However, one of the exceptions to indefeasibility of title is the case of an easement validly created that is omitted from the folio of the register ( Real Property Act 1900, s 42(1)(a1)). I deal with this correspondence further below. 39The explanation for the delay in serving the proposed defence and cross-claim is quite unsatisfactory. Mr Meades gave no evidence as to what steps, inquiries and investigations the defendant had carried out in 2008 and 2009. The evidence as to steps taken to investigate the position after service of the statement of claim was generalised. Mr Meades did not explain why the defendant consented on 10 May and 26 August 2010 to further timetables for filing the defence, except to say that as at 10 May 2010 it was anticipated that the defence could then be prepared. There was no explanation for the delay in filing the present notice of motion, notwithstanding Mr Rozenberg's observation of 13 October 2010 to Mr Meades that if a defence or cross-claim were to be filed, the defendant would need to file a notice of motion. 40Mr Meades gave no evidence to explain the default in giving discovery. 41The defendant has treated the plaintiff and the orders of the court with disdain. 42The defendant needs an extension of time for its application to review the decision of the Registrar of 13 October 2010 refusing its application for a further extension of time in which to file its defence and cross-claim. The court must seek to act in accordance with the dictates of justice in deciding whether it should have that extension of time, in carrying out the review of the Registrar's decision, and in deciding whether the defendant should now have leave to file a defence and cross-claim ( Civil Procedure Act 2005, s 58). In making that assessment I must have regard to the matters in ss 56 and 57. I must have regard to the overriding purpose of the Act to facilitate the just, quick and cheap resolution of the real issues in the proceedings. The proceedings are to be managed having regard to the objects in s 57(1). It is also appropriate to have regard to each of the matters in s 58(2)(b)(i)-(vi). 43A further relevant consideration is the need to maintain respect for the court's authority. In Aon Risk Services Australia Limited v Australian National University [2009] HCA 27; (2009) 239 CLR 175 at [30], French CJ observed that the potential for loss of public confidence in the legal system which arises if a court is seen to accede to applications made without adequate explanation or justification is a relevant consideration in dealing with applications for adjournment, or for amendments giving rise to adjournment, or the vacation of trial dates or the like. Bryson J (as his Honour then was) put the matter eloquently in Hartigan v International Society for Krishna Consciousness Inc [1999] NSWSC 57 at [11]. His Honour said: "'Court efficiency' is a terse mnemonic indeed for the public and private interests involved in conducting Court business according to a known and predictable course, on which expensive preparations can reasonably be based, and with due use of publicly-owned resources, paid for by taxation levied under stern laws and for the most part out of the proceeds of personal exertion of persons who make no use of the Court. A lengthy exposition could be made of what is involved in Court efficiency, with an examination of the adverse impact on the private interests of other litigants in the instant proceedings, of other litigants who are claiming the Court's attention, and in the public interest in maintaining the Court's authority by observance of arrangements with which the Court has directed litigants to comply. There is a public interest in the Court's requiring litigants to respect the due exercise of its compulsory powers over litigants, and in itself acting in the same way, and in maintenance of faith with persons who have expended time and energy to conform with the Court's directions. It is injurious to the respect which the Court and others should maintain for the Court's authority if arrangements made with care are set aside for the benefit of persons who have not complied with the rules of Court."