District Court Rules 2005 (WA)

Jeruth Pty Ltd v Haybale Pty Ltd [2004] VSC 319

Ruby v Doric Constructions (Australia) Pty Ltd [2013] WASCA 94

The Owners of Riviera Apartments (Strata Plan 35851) v Wembley Lakes Estate Pty Ltd [2009] WASC 37

1 DEPUTY REGISTRAR KUBACZ: This is the plaintiff's application dated 4 August 2014 for orders that the dismissal of the action pursuant to r 44G(1) of the District Court Rules 2005 (WA) (the Rules) be set aside and the action be ordered active.

2 The plaintiff's application is supported by an affidavit of Narinder Singh Jessy dated 30 June 2014, an affidavit of Timothy Wayne Kennedy dated 28 July 2014 and affidavits of Fraser Alexander Robertson dated 1 July 2014 and 28 August 2014.

3 In opposition to the application, the defendant has filed and served affidavits of Robert Lelio Marando dated 8 August 2014 and 17 September 2014.

4 This matter was commenced by way of a writ of summons on 13 March 2013. In his statement of claim, the plaintiff claims, in brief, that on or about 22 February 2007 he entered into an agreement with the defendant whereby the defendant agreed to sell opals belonging to the plaintiff. The opals were subsequently given to the defendant in or about April 2007. On or about 19 December 2012, the plaintiff demanded that the defendant return the opals but the defendant refused or failed to return the opals.

5 In his prayer for relief, the plaintiff seeks the return of the opals together with costs. No damages are claimed.

6 A defence was filed on 24 May 2013 whereby the defendant denies the allegations made by the plaintiff.

7 Following the filing of the defence, on 27 May 2013, the District Court issued a case management timetable which set the entry for trial milestone at 21 September 2013.

8 Further, on 27 May 2013, Principal Registrar Gething by the court's own motion made orders that 'unless otherwise ordered, the plaintiff must enter the case for trial by 21 September 2013'. The order, together with the case management timetable, was posted to both the plaintiff's and defendant's solicitors.

9 The matter was then listed for a directions hearing on 5 June 2013 before Deputy Registrar Hogan. At the directions hearing orders were made foreshadowing an application by the plaintiff to strike out parts of the defendant's defence.

10 The application was listed for a special appointment on 31 July 2013 but was subsequently vacated as the parties had entered into negotiations to resolve the matter.

11 From the court's view and following a review of the court file, no further documents were filed by the parties (apart from a notice of change of address for service by the defendant on 9 August 2013) and no hearings were requested or listed from the vacation of the special appointment on 31 July 2013.

12 In accordance with the Rules, a Form 2 Notice of Default (entry for trial) (Form 2 Notice) was issued by the court on 24 September 2013 and posted to both parties. In the Form 2 Notice, the plaintiff was put on notice that unless the matter was entered for trial on or before 9 October 2013, the action would become inactive.

13 On 11 October 2013, according to the court records and pursuant to r 44 and r 44D of the Rules, both parties were issued with a notice that the case was on the inactive cases list and that if certain steps were not taken within a six-month period, the matter would be dismissed for want of prosecution (44D Notice).

14 According to the court records, no further documents were filed by the parties. Therefore on 10 April 2014 pursuant to r 44G of the Rules, the matter was dismissed. The parties were given notification of this on 11 April 2014, when a notice was sent to both parties.

15 On 14 August 2014, some four months following the notice of dismissal, the plaintiff filed a chamber summons seeking orders that the dismissal be set aside.

16 The primary issue in this application is whether the court properly dismissed this matter for want of prosecution pursuant to r 44G of the Rules and in particular whether the 44D Notice was valid. Secondly, I need to determine whether the dismissal should now be set aside.

17 The Rules that determine whether a matter has been properly dismissed for want of prosecution are quite clear however it is convenient to set out the relevant Rules here.

(1) Unless otherwise ordered, the plaintiff must enter the case for trial within 120 days after the date upon which a defence is filed

1. Plaintiff failing to enter case for trial consequences

(1) if a plaintiff does not enter the case for trial in accordance with rule 37(1), the relevant registry must send each party a Form 2 Notice of Default

(a) the plaintiff must, on or before the date specified in the form, enter the case for trial; and

1. Effect of non-compliance with Notice of Default

if a plaintiff does not comply with r 38(2)(a), the case is taken to be inactive.

44D. Parties to be notified of case being on Inactive Cases List and to advise clients

(1) where a case is taken to be inactive under rule 44 or 44A ... the Principal Registrar must ...

(b) give all parties written notice that the case is on the Inactive Cases List and the effect of r 44E and 44G

44E Consequences of case being on Inactive Cases List

If a case is on the Inactive Cases List, only these documents can be filed in the case

(aa) ...

(a) a Form 1 (Entry for trial);

(b) a consent order finalising the case;

(c) a summons for an order under rule 44F(3).

...

44F Removing cases from Inactive Cases List

(1) If a Form 1 (Entry for Trial), or a consent order finalising the case, is filed in a case on the Inactive Cases List, the case is taken to have been taken off the list.

(2) Any party to a case on the Inactive Cases List may apply to the Court for an order that the case be taken off the Inactive Cases List.

44G Certain inactive cases taken to have been dismissed

(1) a case that is on the Inactive Cases List for 6 continuous months is taken to have been dismissed for want of prosecution;

(2) If a case is dismissed under subrule (1), the Principal Registrar must give all parties to the case written notice of the fact;

(5) The Court may, in exceptional circumstances and on such terms as it thinks just, set aside the dismissal of a case under sub-rule (1).

18 The defence in this matter was filed on 24 May 2013. In accordance with r 37, the entry for trial milestone was set at 21 September 2013, which was 120 days after the filing of the defence.

19 This standard District Court timetable was supplemented by a formal signed order, made by the principal registrar ordering that 'the plaintiff must enter the case for trial by 21 September 2013'.

20 At no time after the formal order was made did the plaintiff raise any questions or make any application to challenge the entry for trial order. Further the fact that a formal order was made setting the entry for trial date takes this matter outside the auspices of the issues dealt with in the case of Ruby v Doric Constructions (Australia) Pty Ltd [2013] WASCA 94. In oral submissions, the plaintiff conceded that that case has no application to this present case.

21 The plaintiff had a further opportunity to raise the issue of the entry for trial at the directions hearing before Deputy Registrar Hogan on 5 June 2013. According to the plaintiff's counsel in oral submissions, at the time of that directions hearing, the entry for trial date appeared to be reasonable and the main issue at the hearing was for orders for an application to strike out the defence.

22 There is no contention by the plaintiff, either in oral or written submissions, that the entry for trial date ordered made by Principal Registrar Gething was improperly made, or that it failed to comply with that order and did not enter the matter for trial by 21 September 2013.

23 Given the plaintiff's default, in accordance with r 38(1) the court sent both parties a Form 2 Notice on 24 September 2013 clearly stating that 'if the plaintiff did not enter the action for trial on or before 9 October 2013 it would become inactive'.

24 In the affidavit of Fraser Alexander Robertson dated 1 July 2014, it is acknowledged that the plaintiff's solicitors received the Form 2 Notice on 27 September 2013 and in oral submissions there was no contention from the plaintiff's counsel that the Form 2 was invalidly or improperly sent to the parties.

25 Further there is no contention that the plaintiff failed to enter the matter for trial by 9 October 2013, in accordance with the Form 2 Notice.

26 Given that the Form 2 Notice was not complied with, and pursuant to r 44, the matter was taken by the court to be inactive. In accordance with r 44D(1) the matter was therefore placed on the inactive cases list and a 44D Notice was sent to the parties on 11 October 2013 advising that the matter had been placed on the inactive cases list.

27 It is the actions under r 44D to which the plaintiff takes issue. The plaintiff's contentions, made either orally or in written submissions, are two-fold:

1. In oral submissions it was argued that the 44D Notice was issued irregularly, given that r 44D(2)(b) states that the principal registrar must give all parties notice that the matter is on the inactive cases list; and
2. If the plaintiff fails in its argument that the 44D Notice was irregular, then it submits that they never received the 44D Notice and were therefore unaware that the matter had been placed on the inactive cases list, particularly in light of the state of flux in the law at the time in the wake of the Ruby v Doric Constructions (Australia) Pty Ltd decision.

28 This submission was raised by the plaintiff's counsel orally at the commencement of the hearing.

29 The plaintiff's counsel did not point to any case law to support the submission and relied solely on the wording of r 44D which states that the 'Principal Registrar must give all parties written notice' being a positive wording allowing only the principal registrar to issue a 44D Notice and not the District Court registry.

30 The plaintiff's counsel further submitted that this wording is important as distinction can be drawn to the wording in r 38(1) which states that the Form 2 Notice can be issued by the 'relevant registry'.

31 The plaintiff's counsel stated that the 44D Notice was not signed by the principal registrar nor is there any reference in the 44D Notice that it was sent by the principal registrar and therefore it is non-compliant with the Rules and is irregular. Therefore anything that flowed from the issuing of the 44D Notice, including the dismissal of the action, is also invalid.

32 The defendant's counsel disagreed with the plaintiff's interpretation of the Rule and submitted that the 44D Notice was regularly issued. There were no further submissions.

33 There is nothing in r 44D which states that the principal registrar must sign any notice sent out pursuant to the rule or that the principal registrar cannot delegate the duties under r 44D to another person. This is a matter of interpretation and can be the subject of argument.

34 However, the District Court Act 1969 and the Supreme Court Rules 1971 provide some assistance.

35 Section 53 of the District Court Act states that:

... a registrar who is or has been a legal practitioner has, and is deemed to have always had, for the purposes of this Act, in addition to the powers and authorities conferred upon him by this Act, all the powers and authorities of the Master and registrar of the Supreme Court and every registrar or other officer of the Court in all such actions, matters or causes, discharge any duties that a corresponding officer of the Supreme Court has the authority to discharge.

36 Order 67 Rule 2 of the Supreme Court Rules provides:

Where under these Rules a Registrar (including the Principal Registrar) is required or empowered to do an act of a ministerial nature, it is sufficient that the act is done by other officer of the Court or by a clerk in the Central Office.

37 The Supreme Court Act does not define a ministerial act. However, the Osborn's Concise Law Dictionary defines a ministerial act as 'an act or duty which involves the exercise of administrative powers or the carrying out of instructions as opposed to a judicial or discretionary act'.

38 This definition of ministerial act is supported in a number of other legal and political dictionaries.

39 I am therefore satisfied, that the issuing of the 44D Notice constitutes a ministerial act and therefore pursuant to O 67 r 2 of the Supreme Court Rules, the principal registrar was able to delegate the issuing of the 44D Notice to a clerk in the central office.

40 I am therefore satisfied that the 44D Notice was not irregular or invalid.

41 In the affidavits of Fraser Alexander Robinson dated 1 July 2014, pars 27 - 31, and Narinder Singh Jessy dated 28 July 2014, par 9, it is stated that the plaintiff's solicitors never received notice that the case had been placed on the inactive cases list and they were therefore unaware of this fact.

42 I find the proposition that the plaintiff's solicitors did not know that the matter was on the inactive cases list very difficult to accept for a number of reasons:

1. The plaintiff accepts that they received the Form 2 Notice on 27 September 2013 (affidavit of Fraser Alexander Robinson dated 1 July 2014 at par 18);
2. The Form 2 Notice stated that if the plaintiff did not enter the action for trial on or before 9 October 2013, it would become inactive;
3. A 44D Notice was issued on 11 October 2013 and send to both the plaintiff's and defendant's solicitors;
4. The court's copy of the 44D Notice clearly shows that it was issued to both CS Law and Momentum Legal at the same addresses as the Form 2 Notice;
5. The defendant's solicitor received the 44D Notice on 14 October 2013 (affidavit of Robert Lelio Marando dated 9 August 2014, par 15);
6. The defendant's solicitors by email dated 14 October 2013, notified the plaintiff's solicitors that the matter was now inactive (affidavit of Robert Lelio Marando dated 9 August 2014, par 15).

43 It is not reasonable for the plaintiff's solicitors to submit, as they have, that they were unaware that the action had been entered onto the inactive cases list as the Form 2 Notice on 27 September 2013 clearly stated that the matter would be put on the inactive cases list if the matter was not entered for trial on 9 October 2013.

44 The plaintiff did not enter the matter on 9 October 2013. Therefore it follows that the matter was placed on the inactive cases list.

45 If in fact the plaintiff's solicitors did not receive the 44D Notice, it was already on notice that the matter was on the inactive cases list by virtue of the fact that the plaintiff's solicitors did not enter the matter for trial by 9 October 2013.

46 I further find that the 44D Notice was issued by the court, it was received by the defendant's solicitors and the defendant's solicitor subsequently informed the plaintiff's solicitors that the matter was inactive.

47 If the plaintiff's solicitors were in any doubt about the status of the matter, it was always able to inspect the court file, which would be the expected course of action of a prudent legal practitioner.

48 I therefore do not accept that the plaintiff's solicitors were not aware of the matter being inactive.

49 Once the matter was placed onto the inactive cases list on 9 October 2013, the plaintiff's solicitors did nothing further in relation to this matter, from the court's perspective.

50 It was submitted by the plaintiff's solicitors that the reasons for failing to enter the matter for trial included that negotiations were on foot at the time, the opals were returned and so the plaintiff had to reconsider his case and that it requested the defendant to sign consent orders extending the entry for trial milestone, which it refused to do.

51 By the very fact that the plaintiff sought the consent of the defendant to extend the entry for trial milestone, it is clear that the plaintiff's solicitors were aware that they were in breach of the entry for trial order and that it knew that the matter would be placed on the inactive cases list if the matter was not entered by 9 October 2013.

52 The plaintiff submits that whilst it was waiting on the defendant's solicitors to respond to its request for an extension of time, the matter was placed on the inactive cases list.

53 Irrespective of this, the plaintiff's solicitors could have at any time from the placing of the matter on the inactive cases list for a period of six months filed and served a chamber summons seeking that the matter be reactivated and a new entry for trial date set.

54 However, the plaintiff's solicitors did nothing with respect to the expiry of the entry for trial.

55 I understand the plaintiff's submissions that the plaintiff was in the process of having the opals valued to determine the nature and quantum of the claim, but from the court's point of view this is irrelevant. It is up to the plaintiff to manage the matter and ensure that if it cannot comply with a court order, that the appropriate steps are taken so that the matter does not become inactive.

56 By the plaintiff's counsel's own admission in oral submissions, their 'eyes were taken off the ball' and there is no real justifiable reason why the matter was not entered for trial or that steps were not taken to rectify the situation before it became dismissed for want of prosecution.

57 I am of the opinion that the matter was properly dismissed for want of prosecution pursuant to r 44G(1).

Setting aside the dismissal and the delay in bringing the application

58 Pursuant to r 44G(5), the court may in exceptional circumstances and on such terms as it thinks just set aside the dismissal of a case.

59 This matter was dismissed on 10 April 2014, however the plaintiff did not bring any application to have this set aside until some four months later on 14 August 2014.

60 In written submissions, the plaintiff's solicitors state that the reason for the delay was because it needed to advise their client of the implications of the action being dismissed, they were waiting on a valuation of the opals and they were in negotiations with the plaintiff regarding the matter.

61 In oral submissions, the plaintiff's counsel had no submissions regarding the delay.

62 In the matter of The Owners of Riviera Apartments (Strata Plan 35851) v Wembley Lakes Estate Pty Ltd [2009] WASC 37, in circumstances not dissimilar to these, Master Sanderson found that a delay of four months in bringing an application to set aside a dismissal of the action for want of prosecution brought about the default of the case management system, was not reasonable.

Faced with the dismissal of the action it was to be expected that the plaintiff would have acted promptly. It was necessary for the plaintiff's solicitors to take instructions. I am also prepared to accept that consultation with a number of member of the plaintiff would take some time and that it may have been prudent to continue negotiations with the defendant's solicitors. But taking even the most benign view of these matters, it is difficult to see why it should have taken more than four months to bring this application. It could have been brought almost immediately.

64 I am of the opinion that a delay of four months of which is largely unexplained is too long and is not reasonable in this matter. The application should have been brought immediately.

65 In any event, I am to determine whether any exceptional circumstances arise that would lead me to set aside the dismissal.

66 A circumstance is exceptional on if it is unusual or atypical and causally related to the default in question: Musolino v Osmond [1996] SADC 3526 [3] (19 December 1996).

67 The plaintiff's counsel submitted that this matter falls within the definition of exceptional circumstances as:

1. The 44D Notice was not received and there was therefore an assumption by the plaintiff's solicitors that the matter had not been entered onto the inactive cases list;
2. The plaintiff's conduct prior to the dismissal was not the sort of conduct contemplated by the inactive cases list as this was not a case where the plaintiff took no steps to progress the action given that settlement negotiations had taken place, the opals were found and eventually returned;
3. Following entry onto the inactive cases list the plaintiff was required to undertake a valuation of the recovered opals;
4. The plaintiff has already enjoyed partial success in the action; and
5. The defendant would not suffer any prejudice.

68 For the reasons I have outlined earlier in this judgment, I do not believe that the assumption by the plaintiff's solicitors that the matter had not been entered onto the inactive cases list to be an exceptional circumstance.

69 Further, there is nothing unusual or atypical and causally related to the default in question in the plaintiff's solicitor's conduct of settlement negotiations and determining the nature and basis of this case which relates to the default. These are issues which solicitors deal with on a daily basis in the litigation process whilst being mindful of court procedural requirements. To simply ignore court procedure whilst negotiations and the like are taking place, is not acceptable.

70 The default was caused by the plaintiff's solicitors not entering the matter for trial in breach of a court order and for not applying the court to rectify the consequences of the breach in a six-month period.

71 For all of the reasons above, there are no exceptional circumstances which cause me to find that this matter should be reactivated. The plaintiff's application is therefore dismissed.

73 There is no contention by the plaintiff that if they were unsuccessful in this application, that he should pay the defendant's costs of the application.

74 The issue of costs therefore is of the costs of the whole action. The general rule is that the successful party to an action recovers his or her costs.

75 The general rule usually follows when there has been a decision of the case on its merits or by consent of the parties.

76 However, this action was not dismissed following a decision on the merits of the case. It was dismissed following breaches of the procedural rules of the court. There was therefore no 'successful' party as such.

77 Redlich J in Jeruth Pty Ltd v Haybale Pty Ltd [2004] VSC 319 [2] - [8] summarised the governing principles of costs in a matter which was concluded without a determination on the merits as follows:

... where no hearing on the merits has taken place the criteria upon which costs are normally awarded, namely the success of failure of the litigant, is absent and the appropriate order is generally that each party bear its own costs.

... costs orders may be made where there has been no hearing on the merits and the action is discontinued due to compromise or events after issue of the proceedings which have rendered it otiose ...

... If a supervening event or compromise so removes or modifies the issues in dispute that it cannot be said that one side has won, the Court should not attempt to assess the merits of the case ...

... where it is not clearly discernible that a party would have won and it appears that the parties have acted reasonably in commencing and defending the proceedings ... the Court would usually make no order as to costs.

78 In these circumstances, given there was no trial on the merits and given the parties, in my view, have acted reasonably in commencing and defending the action, the only order that is appropriate is that there be no order as to costs of the case.

79 I therefore dismiss the plaintiff's application and make orders that the plaintiff pay the defendants costs of the application and there otherwise be no order as to costs with respect to the action.