Jardine v Vaughan [2013] ACTSC 264

Supreme Court of the ACT|2013-12-09|Before: Refshauge J, Connolly J

1. The hearing of the Counter-Claim be adjourned for directions to 9:30 am on 7 February 2014.

2. Ms Jardine be required to pay into court the sum of $5,000, on or before 6 February 2014, failing which, absent any appropriate submissions, her defence be struck out and judgment be entered for Ms Vaughan.

3. If that sum is paid into court, the sum abide any order of the court but it be intended to provide security for the costs of the adjournment and the costs thrown away suffered by Ms Vaughan.

4. The right to review that sum be reserved, should there be appropriate submissions made to the Court on 7 February 2014.

1. On 28 February 2004, Coral Jardine sold the business, Coral's Café, to Sonja Vaughan. The agreed purchase price was $130,000, which included goodwill, transfer of the lease, and fixtures and fittings, with stock additionally sold for $1000. Ms Vaughan did not pay the purchase price when Ms Jardine understood that it was to be paid. Payments were made on 22 March 2004 and 10 May 2004 totalling $90,000.

2. On 13 July 2004 Ms Jardine commenced proceedings in the ACT Magistrates Court claiming the balance of $41,000, plus interest and costs. The proceedings had been preceded by some robust exchanges by email, Ms Jardine having returned to South Africa. The proceedings were prosecuted with particulars being sought and provided. A defence was filed which claimed a set-off based on misrepresentations. I do not need to consider whether that properly falls within the concept of a set-off.

3. On 11 November 2005 the proceedings were transferred, by order of Connolly J, to this Court, under s 270 of the Magistrates Court Act 1930 (ACT). Under the orders then made, an amended Statement of Claim was also filed and was met by an amended Defence which pleaded the set-off in somewhat more detailed terms and a Counter-Claim in the same terms. So too were these filed on 21 April 2006.

4. Ms Vaughan, as defendant, then filed a response to the answer to Counter-Claim, curiously calling herself in that document as plaintiff to the Counter-Claim, which is not in accordance with the Rules and is simply apt to confuse.

5. On 14 September 2007, Ms Vaughan, as defendant, issued a third party notice to a firm of accountants, Clarkson Williams Partners Pty Ltd, who, it was said, contravened s 12 of the Fair Trading Act 1992 (Cth) and were guilty of negligent misrepresentation in relation to the dealings leading up to the sale of the business. A defence to the third party notice was filed on 23 October 2007 and a reply to that defence on 9 November 2007.

6. As can be seen, the proceedings were moving at a relatively casual pace. There was some activity in 2008, but nothing thereafter, except notices of intention to proceed filed at various times by various parties. On 25 August 2008, Ms Jardine's solicitors applied for leave to withdraw, although I could not find on the file the fate of that application.

7. On 10 December 2010, Ms Vaughan applied to this Court for the claim by Ms Jardine to be struck out for want of prosecution and this prompted the solicitors for Ms Jardine to file a document which purported to give notice of withdrawal from the proceedings by leave of the court. I could see no leave of the court actually being granted. The plaintiff's solicitors did not seem to have complied with r 2807 of the Court Procedures Rules 2006 (ACT).

8. On 18 April 2011, the claim by Ms Jardine was dismissed for want of prosecution. The application had been served by order of the court on Ms Jardine by post to an address in South Africa. No response was received from Ms Jardine and I was told in these proceedings that it had not actually been received.

9. The proceedings fell into the doldrums again with the only activity being Ms Vaughan filing a notice of intention to proceed in 2012, by which time the proceedings may well have been dismissed under r 75 of the Court Procedures Rules, but that issue was not agitated in these proceedings.

10. The proceedings were revived this year, however, with the proceedings being prepared for hearing in late 2012 and into 2013. At this stage, of course, the Counter-Claim remained on foot, as did the third party notice.

11. On 17 May 2013, Nield AJ made an order which seems to me to be very curious in its terms. It provided:

1. The defendant who should be known as the plaintiff and the third party who should be known as the defendant are now in agreement that the plaintiff's claim and the defendant's defence are ready for hearing. Leave is given for the parties to approach the list clerk today for a hearing before Justice Refshauge estimated to be 3 days; and

2. The costs of this application are the defendant's (third party's) costs in the cause.

12. The order also notes an undertaking as to costs not presently relevant.

13. It is curious because it omits any reference to the Counter-Claim and presumes that the extant proceedings are only between Ms Vaughan, now as plaintiff, and Clarkson Williams Partners Pty Ltd, as defendant.

14. That is inconsistent with correspondence that was sent in 2011 by Ms Vaughan's solicitors to Ms Jardine, making it clear that they intended to proceed with the Counter-Claim.

15. An attempt was made on 2 October 2013 to serve Ms Jardine in South Africa, but I was told that there was no response to service on her of that document. There had been earlier correspondence which, as I have said, suggested that Ms Vaughan was to proceed with the Counter-Claim, and, again, on 2 October 2013, which stated that the proceedings were listed for 9 December 2013 and would then proceed. Again there was no response.

16. There was a reference in that correspondence, also, to the defence that had been filed by Ms Jardine to the Counter-Claim having been struck out, but I could find no order to that effect.

17. Further attempts were made to serve Ms Jardine and this was done, apparently by Facebook, which showed that she now lived in Qatar. This probably explains why there had been no response to any of the correspondence that had been sent to South Africa.

18. A letter dated 29 November 2013 was then received by her from Ms Vaughan's solicitors and she instructed solicitors urgently. Counsel appeared before me today, seeking an adjournment of the proceedings so that Ms Jardine could prepare and properly participate in them.

19. It is tempting to say that Ms Jardine had forfeited the right to an adjournment by inaction since 2008.

20. Nevertheless, it appears that she may not have been contacted since then and that she may have thought that, as a result of her non-activity in the matter, there was no activity generally in the matter and the proceedings had all gone away. The messy nature of the proceedings and the odd order of 17 May 2013, however, do lead me to be concerned that Ms Jardine may not be able to receive justice if an adjournment is not given.

21. The proceedings between Ms Vaughan and Clarkson Williams Partners Pty Ltd can proceed. Whilst there is some risk of inconsistent verdicts, that, it seems to me, is unlikely, as the causes of action are actually quite different, or based on different material. That claim, between Ms Jardine and Ms Vaughan, is based on oral representations, although there are some written documents also involved. The claim between Ms Vaughan and Clarkson Williams Partners Pty Ltd is based on oral representations made in meetings that were had between Ms Vaughan, her husband, Ms Jardine, her husband, and an officer of Clarkson Williams Partners Pty Ltd. Thus, there is some but little commonality in the actual representations.

22. There are good reasons why Ms Jardine is not entitled to any indulgence by the court. One only has to refer to r 21 of the Court Procedures Rules and the approach of the High Court in AON Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175, to see that she has little call on the sympathy or indulgence of the court.

23. Nevertheless, this is an extraordinary case, where no party comes with a good record of progressing the proceedings in a timely and orderly fashion. Was there to be direct prejudice to Ms Vaughan, then I would not be prepared to grant the adjournment sought, but that does not seem to me to be the case here.

24. I am prepared, rather reluctantly, to grant an adjournment, but it must be on terms.

25. What I propose to do, and I will hear from the parties interested as to the orders, I propose to adjourn the hearing of the Counter-Claim for directions to 9:30 am on 7 February 2014.

26. The terms are that Ms Jardine must pay into court the sum of $5,000 on or before 6 February 2014, failing which I would intend, absent any appropriate submissions, to strike out her defence and enter judgment for Ms Vaughan.

27. If that sum is paid into court it shall abide any order of the court but is intended to provide security for the costs of the adjournment and the costs thrown away, suffered by Ms Vaughan, that I will also order. I also reserve the right to review that sum should there be appropriate submissions made to me on 7 February 2014.

I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of his/her Honour, Justice Refshauge.

Solicitor for the Applicant: Chamberlains Law Firm as agent

Solicitor for the Respondent: Donohue & Co, Solicitors

Fair Trading Act 1992(Cth)

Procedures Rules 2006

Fair Trading Act 1992(Cth)

Procedures Rules 2006

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