Kiwi Munchies Pty Ltd v Thai Airways International Public Company Ltd

Kiwi Munchies Pty Ltd v Thai Airways International Public Company Ltd - [2002] NSWSC 82 - NSWSC 2002 case summary — Zoe

[30]

[3] The Amended Summons of 15 February seeks to bring on appeal to this Court not only the order of summary dismissal pronounced on 7 June 2001; but also the costs order made by the learned Local Court Magistrate on 25 October 2001 in favour of Thai and in connection with Thai's Notice of Motion for summary dismissal. 4 It is, of course, completely clear that the Notice of Motion filed on 24 January 2002 is grossly out of time. The relevant Rules of Court required the applicant to move in this Court not later than 28 days after the date of the judgment from which it was desired to appeal to this Court. A period of 28 days from 7 June 2001, calculated in accordance with SCR Part 2, ended on 6 July 2001. As previously explained, this Court was not approached for an extension of time until the filing on 24 January 2002 of the present Notice of Motion. This is a delay of some 6-1/2 months. It is a gross delay and not lightly to be excused. 5 I apprehend, having regard to the way in which the present Notice of Motion was argued, that it would be useful to re-state some fundamental principles. 6 The first such principle is that the applicant bears the onus of proof of its proper entitlement to the extension of time that it now seeks. The standard of proof is, of course, proof to the civil standard: that is to say, proof on the balance of probabilities. A classic exposition of what this concept actually means is found in the judgment of Dixon J in Briginshaw & Briginshaw [1938] 60 CLR 336 at 362, where his Honour says: "…………………. (R)easonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters 'reasonable satisfaction' should not be produced by inexact proofs, indefinite testimony, or indirect references." 7 The second such principle is that it is well settled law that an applicant for, relevantly, the indulgence of an extension of time in which to lodge an appeal must establish affirmatively on the probabilities a series of distinct propositions. A convenient summary and discussion of those propositions will be found in the judgment of McHugh J of the High Court of Australia in Gallo v Dawson [1990] 93 ALR 479. The relevant propositions can be extracted conveniently, and as follows, (and omitting references to curial decisions), from the head note: "1. The grant of an extension of time is not automatic. The discretion to extend time is given for the sole purpose of enabling the court to do justice between the parties. 2. 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. 3. In considering an application for an extension of time in which to file an appeal it is necessary to consider the prospects of the applicant succeeding in the appeal and to bear in mind that upon the expiry of time for appealing the respondent has a vested right to retain the judgment unless the application is granted. 4. A case would need to be exceptional before a court would enlarge by many months the time for lodging an appeal simply because an applicant has refrained from appealing until he or she has researched the issues involved." 8 I propose to look separately at each of the foregoing propositions.

[31]

On 31 January 2002 the solicitor for the applicant swore an affidavit in support of the present Notice of Motion. The affidavit brings up to date the history previously herein recounted. The additional items in that continuing history are as follows, quoting in the first instance from the said affidavit: "20. Even though the plaintiff was aware of the time limit for filing an appeal against the summary dismissal order, it was unable to fully evaluate the merits of such an appeal until the time allowed for filing had expired. 21. By early August 2001 it became apparent that counsel who had been initially briefed to assist the plaintiff was not going to be able to fulfil her brief. The plaintiff then decided to brief alternate counsel …………………….. . His brief was delivered by mid-August. 22. Between mid-August 2001 and 25 September 2001 the plaintiff was able to assemble the relevant evidence on the issue of notice and that evidence was presented to ………… [the learned Local Court Magistrate] ………… on 25 September." 9 The written submissions put in for the applicant contend that the applicant was unable to obtain, prior to 7 December 2001, a copy of the judgment delivered on 25 October 2001. It is submitted that there was a delay of only 4 days thereafter in the filing of an appeal against the summary dismissal ordered on 7 June 2001. 10 The same written submissions indicate three categories of evidence upon which the applicant seeks to rely on the issue of delay. The affidavit of the applicant's solicitor sworn on 31 January 2002 is one such source. The other two sources are said to be documents constituting, in each case, a chronology of events, in one case from 16 May 2001 to 7 December 2001; and in the other case from 13 July 2001 to 7 December 2001. 11 I rejected the tender of these documents at the hearing of the Notice of Motion. I did so because I took the view that in the circumstances of the present case Thai, as respondent to the Notice of Motion, was entitled to have set out clearly on affidavit all of the grounds upon which the applicant relied in connection with, relevantly, the history of the proceedings and the associated issue of delay. I am prepared, however, to assume for present purposes that the purport of the documents, had their contents been properly proved, would have been to give a colour of credibility to the suggestion made in the written submissions that it was not until 7 December 2001 that it had become possible to obtain a copy of the judgment delivered by the learned Local Court Magistrate, not on 7 June 2001, but on 25 September 2001. 12 It is, in my opinion, important to make at once the point that it is a misconception to speak of an appeal filed on 11 December 2001. The fact of the matter is that no appeal has yet been filed in compliance with the requirements in that behalf of the Supreme Court Rules. The time for filing an appeal has lapsed. The filing of an appeal at any time after the expiration of 28 days after 7 June 2001 was incompetent without the prior leave of the Court. The real measure of the relevant delay is not to be taken by reference to any day upon which a purported appeal, incompetent because of non-compliance with the Supreme Court Rules, was filed or attempted to be filed. The relevant reference date is 24 January 2002, the date upon which the necessary Notice of Motion for an extension of time for appeal, was filed.

[32]

The Conduct of the Parties 13 The conduct of the applicant has been throughout, in my opinion, unsatisfactory. This is particularly so, in my opinion, in connection with the way in which the proceedings in the Local Court were handled on 7 June 2001. I shall return presently to this aspect of the present application. 14 The conduct of the applicant, by its legal advisers and representatives, in the wake of the judgment of 7 June 2001 has been also, in my opinion, unsatisfactory. As will be seen presently, the judgment given in Thai's favour on 7 June 2001 was given ex tempore. Whether correct in law or not, the judgment was at least brief, and completely clear in what it said. At the close of the proceedings on 7 June 2001, the applicant cannot have been in any doubt, not only about the fact that its then current proceedings against Thai had been dismissed summarily, but also of the process of reasoning upon the basis of which the learned Local Court Magistrate had come to the conclusion that a summary judgment of dismissal was a just order on the evidence, such as it was, that had been then presented to his Worship. If, as the applicant now contends, the summary judgment of dismissal was clearly premature, and unfair both procedurally and substantively, then it seems to me that nothing would have been simpler than for an immediate appeal to have been lodged. 15 The written submissions for the applicant recognise the problem that this state of affairs poses for the applicant in connection with the present Notice of Motion. The written submissions seek to deal with that problem by advancing the following propositions: "The determination of the legal issue of whether the …… (applicant)……….had a cause of action against …………(Panalpina) ……….wholly outside the Convention was not made by ………..(the learned Local Court Magistrate) ……….until 25 September. Had the appeal been lodged before that determination ………. (the present applicant) ………ran the risk that it would lose the appeal because there was no determination that ………….(Panalpina) ……… was a 'contracting carrier' and hence bound by the Convention. The only viable cause of action against ……….(Thai) ……….was under the Convention and only if ……….(the present applicant) ……… could prove that the mandatory Notice of Claims was given within the stipulated time. As the ……(present applicant) …… had to rely on Article 4 (deemed notice), it could not prove deemed notice until it was held that ……..(Panalpina) …….. was a 'contracting carrier' under the Convention." 16 These submissions entail, in my respectful opinion, a fundamental misconception. No appeal against the judgment of summary dismissal of 7 June 2001 could in any event succeed unless it was demonstrable that such judgment had been pronounced erroneously in law. In order to establish such error in law, it was necessary to establish, not that the learned Local Court Magistrate could have, or might have, or more probably than not would have, come to a different conclusion had his Worship had before him evidence which was not adduced in connection with the hearing on 7 June 2001. The question on an appeal from the decision of 7 June 2001 was, always and simply, whether the evidence then before the learned Local Court Magistrate was such as to permit in law the giving of summary judgment in favour of Thai. 17 It cannot be correct, in my opinion, to suppose that in those circumstances the present applicant was entitled, as it were, to lie by without regard for the requirements of the Supreme Court Rules as to the giving of notice of appeal; and upon the basis that, should subsequent developments appear to improve the applicant's prospects of success in an appeal against the summary judgment, then such appeal could, more or less as a matter of course, be brought without any need to be troubled greatly by a failure, however substantial, to comply with the relevant Supreme Court Rules. 18 The applicant could have taken an alternative position with regard to the summary judgment: that is to say, the applicant could have taken the position that what occurred on 7 June 2001 amounted to a denial of natural justice such as vitiated the judgment itself. Once again, however, there was no need to tarry in lodging an appeal against the judgment. Nothing that happened after 7 June 2001 could have had any relevance to a challenge, based upon an alleged denial of natural justice, or upon any other alleged vitiating procedural irregularity, in connection with the conduct on 7 June 2001 of the proceedings in the Local Court. 19 During the hearing of the present application, there was an exchange between the Court and learned counsel appearing for the present applicant, the exchange being directed to the question whether the applicant was wishing to contend that this Court should intervene because the way in which the applicant's case was conducted on 7 June 2001 was an example of that "flagrant incompetence" that was discussed in the decision of the Court of Criminal Appeal in Reg v Birks [1990] 19 NSWLR 677. The principles thus established are now well known, and it is not necessary to repeat them in detail. The decision was, of course, a decision in a criminal case; but I would not see, as at present advised, why an analogous stance could not be taken, in a proper case, in the context of civil litigation. Be that as it may, no such submission was put in support of the present application. 20 If a reasonable view be taken, overall, of the comparative conduct of the parties and of the relevant history of the proceedings, then in my opinion it is fair to say that no fault can be attributed to Thai in the matter of the egregious delay in the bringing of the present application; and that such delay has not been satisfactorily explained.

[34]

The Hearing in the Local Court on 7 June 2001 24 The hearing began with all three parties represented. An in-house solicitor appeared for the present applicant; and counsel appeared, separately, for Panalpina and for Thai. 25 The proceedings began with an outline by learned counsel for Panalpina of its case in support of its Notice of Motion to dismiss the applicant's claim against it. The outline culminated with this statement: "But before sitting down, what is not clear at this point is whether your Worship has to deal with a contest over the propositions which we advance and whether they are accepted and this is really a question of whether the plaintiff should be permitted an opportunity to amend. On the other hand, there may be some contest over that. Perhaps in time we will find out." 26 The learned Magistrate then invited the applicant's solicitor to be heard. The solicitor replied: "Your Worship, as far as the first defendant is concerned there is a whole issue as to what capacity it actually acted in, was it merely an agent or was it a carrier. If it was an agent, it's disputable in our minds whether or not that convention actually applies to it. If it was a carrier, then the issue arises as to whether or not it was actually authorised to do so on behalf of the plaintiff and I say that for a number of reasons. The standard terms and conditions -" 27 At that point the learned Magistrate interrupted. His Worship told the applicant's solicitor that it seemed to him that all that counsel for Panalpina had asked "really is is there a contest on this and are you asking for an opportunity to amend the pleadings or are you just saying there is a contest". 28 The solicitor replied simply: "There is definitely a contest". 29 The learned Magisrate responded: "Alright, so long as we understand that, we'll come back to you in a moment". 30 Counsel then appearing for Thai read, thereupon, the affidavit evidence in support of Thai's Notice of Motion. 31 After Thai's evidence had been read, the learned Magistrate asked the applicant's solicitor whether she was proposing to call any evidence. She responded: "No your Worship. I simply have some submissions to make in respect of this matter". (The transcript of the proceedings in the Local Court attributes this statement to counsel appearing for Thai. I think, however, that it is plain from a fair reading of the context, that such is a misprint and that the statement is to be attributed properly to the applicant's solicitor.) 32 Submissions then began. They commenced with lengthy submissions from counsel for Panalpina. At the conclusion of those submissions, counsel for Thai made submissions. 33 Counsel put at the forefront of his submissions the proposition that the Warsaw Convention was clearly applicable. Counsel continued: "To the extent that there's any issue about the first defendant's position and whether with any aspect of the carriage it was otherwise an international air carriage, that issue does not affect my client. There is no question, we are the airline, it's pleaded against us that we carried the goods on air from Auckland to Sydney. So there is absolutely no issue with respect at least to my client that the Convention applies in all its terms, including the requirement for written notice within 14 days. The evidence that's been filed makes it abundantly clear that there has been no written notice within 14 days. Nothing was received by my client." 34 Counsel then referred to a table set out in paragraph 3 of an affidavit which had been sworn on 23 May 2001 by Panalpina's solicitor, and which had been read in support of Panalpina's Notice of Motion. The table summarised material extracted from further and better particulars that had been provided by the present applicant to Panalpina. The table shows seven particular items. Each item is identified by a particular billing number. In respect of each such item a date of delivery to the present applicant is shown, together with the date of written complaint in any case where the further and better particulars enable such a date to be fixed. There were certain other particulars not now relevant. As to one of the items, numbered 360155, the further and better particulars propounded a date of delivery of 14 January 2000 and a date of written complaint of 11 January 2000. For four out of the remaining six items, the further and better particulars could not point to any date of written complaint. That left two items as to each of which the further and better particulars suggested a date of delivery of 24 December 1999 and a date of written complaint of, in one case 17 February 2000, and in the other case 11 January 2000. The practical upshot of that evidence was that, excepting only the delivery covered by item 360155, it was plain that the Warsaw Convention, if it applied, entailed that the present applicant could not succeed because it could not prove a written complaint made within 14 days of the date of delivery to the applicant. 35 Counsel pointed out, quite correctly and reasonably in my opinion, that the applicant had had every opportunity to dispute the accuracy in fact of the contents of that table; and had not done so. It was submitted that the learned Magistrate "ought to proceed on the basis that that table accurately reflects the position. There is no other evidence.". 36 Counsel for Thai rounded out his submissions as follows: "On that basis, at least with respect to the second defendant, there is no cause of action which lies. That's the effect of the Convention and the effect of the Commonwealth Act. No amendment with respect to a claim against the second defendant can cure that position because it's simply a matter of fact, and the position follows from that matter of fact. Doesn't matter whether it's pleaded in any cause of action, even though, as my friend has indicated, the only cause of action available is under the Convention. But whatever in the end is proposed, it will never cure that fact. And as your Worship said earlier, it is game, set and match against the second defendant." 37 The solicitor then appearing for the applicant was invited, then, to make her submissions. The solicitor did so, and in some fair detail so far as concerns what she had to submit about the position of Panalpina. The course of those submissions led the learned Magistrate to interpose the following observations: "You've been giving me a whole lot of evidence for about the last five minutes from the Bar table. But has it occurred to you or to your client to put on an affidavit?" 38 This drew from the present applicant's solicitor the following exchange with the learned Magistrate: "[SOLICITOR]: Well I mean basically today I came down here to seek an adjournment in order to amend the pleadings. I notified both parties on Monday that that was to happen. Got a copy of the draft………….. [BENCH]: You didn't tell me that when you walked in at 11 o'clock. [SOLICITOR]: Well the problem is that my learned friends who stood up and continued with their submissions, I found it very hard to say anything. [BENCH]: I'm sorry but I thought I asked you whether you were planning to amend the pleading or not. Have you misunderstood what I asked you? [SOLICITOR]: I was under the impression you asked me whether or not we were willing to contest it. It certainly wasn't my application --- [BENCH]: And then you were planning to amend the pleadings? [SOLICITOR]: I don't I don't recall your Worship. I might have been --- [BENCH]: I'm sorry, maybe I should have made myself more clear. [SOLICITOR] I don't recall. Because if that was the case, I have faxes that I sent to both parties on Monday indicating that I intended to amend the pleadings based on significant developments, as I call them, over the past few weeks, and that was my application before the Registrar this morning. My friend then stood up and said that we had a hopeless case. I don't agree with him. It is a complex case, it's becoming more complex the more we look at it, but I think at the end of the day, the plaintiff should be allowed to bring its action. [BENCH]: Then the first question is whether you should be allowed to plead the action that you actually want to run and amend your Statement of Claim, and then I suppose we can see about whether it's a futile cause or not. But that's what you're asking to do now, is it? [SOLICITOR]: Well my submissions seen before the Registrar this morning were in faxes sent to both parties on Monday that we wished to amend the pleadings. I knew I wouldn't have the pleadings ready by today. I didn't want to be here today arguing these points, and clocking up costs for those parties, and I though that ………". 39 The Magistrate then put to the present applicant's solicitor that counsel for Thai had argued that whatever might be done in the matter of an attempted amendment of the pleadings, nothing useful could be achieved so far as concerned proceedings against Thai. His Worship concluded this passage of his remarks, and after a brief reference to the position of Panalpina, by saying: "So again I could give you an adjournment to go away and amend the pleadings and come back and see where we stand, in fact that might be the fairer thing to do really." 40 The applicant's solicitor's response was to say that there was another issued that she wanted to raise. She then raised some matters about, essentially, the discovery of various documents. This new issue touched off a further exchange of submissions. They culminated, so far as concerned Panalpina, in a statement by counsel for Panalpina that "quite frankly I was expecting an adjournment application, but it didn't come. If your Worship takes a view that your Worship prefers to give the plaintiff an opportunity to consider it, I'm not going to take your Worship's time now in opposing it. There are grounds for doing so, but I don't think there's anything that I could say that would not have already occurred to your Worship". 41 Counsel appearing for Thai was not so accommodating. Counsel opposed any adjournment so far as concerned the proceedings against Thai. He submitted: "…………….. The plaintiff's claim against my client is clear. It's claimed that the goods were carried by air by my client. There is no question that it's covered by the Convention, it can't be pleaded any other way. The restrictions on the ability of the plaintiff to claim clearly have been taken to those. There's nothing with respect to my client that can be cured about that. ……………………… To put that in context, if the plaintiff's case is that the first defendant's not a carrier, then this doesn't apply and there's no question that no notice was given to my client, so we're out. If the plaintiff ……. (not transcribable) …….. is a carrier then the evidence discloses that even though a complaint was made, it wasn't made within the 14 days. Again, we're out. So in my submission, the only thing I will say about the adjournment, to the extent that any leave is given to amend to the plaintiff, as in its (sic: but presumably as in its proceedings against), the first defendant I have nothing to say but in my submission the proper application of principle would be there is no point incurring further costs and no point in giving the plaintiff leave to amend as against my client. In effect to bring the matter before the court will inevitably do the same thing, the same things can be said." 42 The applicant's solicitor was invited to respond. She did so in these terms: "Yes, I don't agree, I simply don't agree. The reason for that is that we were made to believe that our correspondence had been passed on and we should not have to suffer the consequences of that." 43 Pressed to respond in a more particular way to the submissions that had been addressed to the Court by counsel for Thai, the applicant's solicitor said: "Well at this point I think it's imperative that we have a look at the documents for delivery. It is imperative that we look ---." 44 This response touched off yet a further exchange about documents. At the conclusion of that exchange the learned Magistrate indicated to the applicant's solicitor that he could not see what cause of action her client had against Thai. His Worship invited any further submissions on that aspect of the matter before the Court. His Worship received the following response: "Your Worship, I came, and I repeat, I came down here this morning to argue the point for an adjournment. I don't have any other authorities on me. With regards to the second defendant apart from the fact that I read out that article which says that notice to one is notice to both. ………………… .' 45 There then ensued exchanges between the learned Magistrate and various of the legal representatives. The upshot was an indication by the Magistrate that he would give the applicant "an adjournment to do something about your pleadings in relation to" Panalpina. His Worship went on to say that he was "unconvinced " in relation to he position of the claim against Thai, excepting only the item identified by the number 360155. 46 The learned Magistrate then delivered an ex tempore judgment, being the judgment that is the subject of the present application. The significant portions, for present purposes, of that judgment read as follows: "I have been taken to the various conventions which are part of the Civil Aviation Carriers Liability Act 1959 and the authorities which have considered it. It is clear that the second defendant, Thai Airways International, is a public company and its only part in relation to this action was in relation to the air transport of the goods which the plaintiff alleges were damaged and consequent loss is suffered. It appears to me on a consideration of the law here that the only action available to the plaintiff against the second defendant is an action under the conventions pursuant to the Act just referred to. One of the principal requirements of a course of action under the conventions is that pursuant to Article 26 that notice be given within fourteen days from the receipt, in the case of cargo, of the goods. In other words, a complaint has to be made within fourteen days of receipt or delivery of the cargo or no course (sic) of action is available to the consignee. I have been taken to he decisions of the House of Lords, the Supreme Court of the United States, and the Court of Appeal Singapore, and also the New South Wales Court of Appeal, all of which say that the Convention is a code, that there is no common law action available to consignees in a situation akin to this one. Therefore, it seems to me that, there being no evidence whatsoever that complaint was made either to the actual or the contracting carrier within fourteen days except in relation to airway bill 360155, the plaintiff's course (sic) of action cannot succeed at all in relation to the second defendant. In relation to airway bill 360155 I think that there is evidence which gives rise to a live issue between the parties, and in relation to that issue, the action obviously can continue. I am not persuaded at this stage that it is an utterly futile course on the plaintiff's part." 47 As I have previously pointed out in this judgment, the applicant cannot succeed in any appeal against that judgment of 7 June 2001 unless the applicant can demonstrate that the judgment was erroneous in law. The written submissions put in for the applicant propound as follows, omitting references to authorities, the following errors of law: "2.1 The error of law is that his Worship, in making the order for dismissal at that stage of the proceedings, and without allowing the plaintiff time to amend and re-formulate the pleading against the second defendant (Thai Airways) acted contrary to established principles governing summary dismissal …………………… . 2.2 His Worship erred because in all the circumstances the making of such an order was premature and the stage had not yet been reached in the proceedings where the plaintiff should be denied its right to pursue those particular claims (the bulk of its claims) against the second defendant. 2.3 It is submitted that his Worship ought to have made the same order in the claims against the second defendant as he did for the claims pleaded against the first defendant (Panalpina World Transport). That is, he should have allowed the plaintiff time to amend and re-plead and made a final determination of the second defendant's motion for dismissal after reviewing the amended pleading and hearing further evidence and submissions on 25 September 2001 as he did for the first defendant on its motion for dismissal. 2.4 It is submitted that had his Worship done this there can be no doubt at all, based on his written judgment handed down on 25 October 2001, that he would not have dismissed the plaintiff's claims against the second defendant and the plaintiff would have been able to take those claims to a full hearing and have them decided on their merits." 48 In connection with these submissions, I express the following opinions:

[45]

The Consequences to Thai Airways of the Grant of the Present Application 50 There must be, in my opinion, significant disadvantage to Thai Airways from the grant of the present application. 51 First, it has not been shown that Thai Airways did anything unconscionable in connection with its Notice of Motion for summary dismissal. It was a legitimate application to make; and it was made regularly according to the relevant Rules of Court. In so far as it might be thought that there were short-comings in the present applicant's representation on 7 June 2001, there is no rational basis upon which the consequences of such short-comings ought justly to fall upon Thai Airways. 52 Secondly, and as Gallo v Dawson makes plain, Thai Airways has a vested right to retain its judgment unless the present application is granted. To speak in that context of a vested right is not to speak of a mere formality, or to speak in any other sense of something lightly to be set aside. That must be all the more so when, as in the present matter, the application to set aside that vested interest is made after an inordinate delay for which, as I think, no reasonably satisfactory explanation had been advanced by the applicant. 53 Thirdly, it would not be, in my opinion, either just in principle or reasonable in fact to decide the present application upon the basis that, since Thai Airways must, as matters stand, meet in any event the re-formulated claim based upon the one particular item of which I have earlier spoken, it can make no great difference if the present judgment is set aside and four or five additional claims are permitted to be revived. Thai has placed itself, without any unfairness or impropriety of any kind, in a position of forensic advantage as between itself and the present applicant. The applicant has placed itself in a corresponding position of forensic disadvantage because of its own conduct, not he least aspect of which for present purposes is the aspect, to which I have more than once referred already, of inordinate and unsatisfactorily explained delay.

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