L & W Developments Pty Limited v Alain Della

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION COMMERCIAL LIST

Friday 26 March 2004 ex tempore Revised 21 April 2004

50143/02 L & W Development Pty Limited v Alain Della JUDGMENT 1 There is before the Court a notice of motion filed on 4 March 2004 pursued by the plaintiff for a vacation of the stay of proceedings ordered on 8 November 2002 in the proceedings. 2 It is unnecessary to repeat the record. Suffice it to say, that the reasons of the Court of Appeal [L and W Development Pty Ltd v Della [2003] NSWCA 140] delivered on 5 June 2003 by Mason P, with whom Giles JA and Santow JA agreed, set out in great detail the then position clarifying the factors which required then to be taken into account in terms of the balancing exercise required by the interests of justice where the subject exercise of discretion came up for determination. Although there has been an interval of time between that date and the hearing of the motion the subject of this judgment, as a general matter, it is quite plain that those very same factors require to be taken into account. There are, however, additional matters which require to be examined and carefully weighed in the balance. 3 In other circumstances, it may have been necessary for the Court to treat with the principles governing the stay sought in these proceedings and the jurisprudential background underpinning the proper exercise of that discretion. That the Court of Appeal has so very carefully and thoroughly treated with that subject matter makes it otiose for the Court now to re-enter that same arena. Having said that, of course it is the case that not every one of the factors which then were of immediate concern to the Court of Appeal are the same factors which are of immediate concern to this Court. This is simply an exigency of the passage of time and the obviously instant-specific needs of an exercise of the relevant discretion on the occasion when a particular application is before the Court. 4 As a matter of convenience I intend to refer to the plaintiff in the Supreme Court proceedings, which is the respondent to the IRC proceedings, as "the plaintiff" and to the defendant in the Supreme Court proceedings, which is the claimant in the IRC proceedings, as "the defendant". 5 Importantly, the plaintiff has produced, and the submissions from the parties have focused upon, a very carefully prepared chronology which forms the fulcrum of most of the attention underpinning the respective stances taken by the parties before me. 6 That chronology is conveniently appended to the judgment as Appendix "A". 7 The gravamen of the reasons given by the Court of Appeal accepted the significance of a stay of proceedings commenced in a superior court and heavily emphasised the fact that the orders effected only a temporary conditional stay of these proceedings: that is to say, provided a regime that suspended further prosecution of these proceedings conditionally upon the expeditious prosecution of the IRC proceedings. So much is apparent from the reasons given by the learned President [at 37], where he made the further point that:

"The temporary, interlocutory nature of the orders and the liberty to apply expressly reserved would allow the appellant to return to the Supreme Court if there were any material change in circumstances."

Further, the President [at 57] clearly took into account the fact that:

"No prejudice flows from a stay which is subject to conditions requiring the expeditious prosecution of the IRC proceedings and is at all times reviewable for change of position. The Supreme Court proceedings can be brought on for trial shortly after the conclusion of the [industrial] proceedings. 8 It is appropriate to commence with an examination of the undertakings and orders put in place on 8 November 2002, which are conveniently set out in the reasons of the President in the Court of Appeal at 33 to 35: · "There were two sets of formal orders, each apparently made on 8 November 2002. · The first set of orders were: The Court: 1. Notes:

The undertaking of the Defendant that he will diligently prosecute proceedings 8168 of 2001 issued in the Industrial Relations Commissioner ("the IRC Proceedings") and he will: (a) use his best endeavours strictly to comply with the timetables and directions set by the Court in the IRC proceedings, (b) within seven days list the IRC proceedings for directions, and (c) within seven days file a motion seeking orders for expedition of the IRC proceedings. 2. Orders: (a) That in the event that the Defendant defaults in compliance with any timetable or direction set by the Court in the IRC proceedings and does not cure the default within two business days the plaintiff be at liberty to apply to the Court to vacate the order made by this Court on 8.11.2002 staying these proceedings, (b) that in the event that the Defendant breaches either undertaking 1(a) or 1(c) above the plaintiff be at the liberty to apply to the court to vacate the order made by this Court on 8.11.2002 staying these proceedings.

Liberty to apply to either party on two days notice in writing. · The second set of orders were: THE COURT ORDERS that:

1. Until further notice, these proceedings are stayed. 2. The Plaintiff to pay the Defendant's costs of the Motion dated 10.10.2002." 9 The submissions of the plaintiff [in respect of the 8 November 2002 paragraph 1 entitled "Notes"] were that the undertaking there noted was effectively and is properly to be read as an undertaking of the defendant that he would diligently prosecute the IRC proceedings and as well would carry out the actions required of him in subparagraphs (a), (b) and (c) of those notes. 10 The submissions by the defendant were that paragraphs 2(a) and (b) (in terms of the orders) were only enlivened in the circumstances specified, that is to say,

(i) in the event that the defendant defaulted in compliance with any timetable or direction and failed to cure the default as required, then there would be liberty to apply to this Court to vacate, and (ii) in the event that the defendant would breach either undertaking 1(a) or 1(c), liberty to apply to vacate would be available to the plaintiff. 11 In my view, it is plain that properly construed, the defendant undertook to diligently prosecute the proceedings before IRC. Indeed, this was the subject of a concession before me by counsel for the defendant [appearing at transcript 55.20]. As to the submission that orders 2(a) and (b) are only enlivened in the circumstances there specified, it does not seem to me that this is a correct reading nor completely states the ambit of the undertaking to diligently prosecute. 12 The short position is that the application to lift the stay is underpinned by the proposition that there has been a clear contravention of that undertaking to diligently prosecute the IRC proceedings and that a proper examination of the events proven makes plain that that breach is a radical breach. This then requires the Court to turn to examine the suggested breaches. 13 Before doing that, there is another general matter which requires to be examined. Whilst not altogether entirely clear to me, at one stage it seemed that counsel for the plaintiff submitted that the Court appropriately returns to the very commencement of the subject events; that is to say, not being constrained by looking forward only from the date when argument took place before the Court of Appeal. 14 As it happens, a cumulative chronology has been kept, and one is able to locate the form of chronology which was before the Court of Appeal [in fact, now being an appendix to the affidavit of Ms Schiff made on 8 November 2002]. 15 My own view is that the proper course is generally to look forward from the circumstances which then obtained, and, in that regard, that the Court in terms of the instant application the subject of this judgment is entitled as a matter of factual matrix and background to look at the anterior events, but it is taken, it seems to me, as a given, that as at the date when the matter was argued before the Court of Appeal in early May 2003 [and likely as at 5 June 2003], the defendant had made good the proposition that the stay, albeit granted conditionally upon the expeditious prosecution of the IRC proceedings, at that time represented a proper exercise of the Court's discretion. 16 An immediate example of the need to look at the anterior position arises in terms of the plaintiff's complaint that the defendant has grievously failed to properly, or at all, deal with the plaintiff's frequent requests for a regime for and for proper discovery. The plaintiff has submitted that its need to obtain full discovery from the defendant has always been, and remains, of extreme importance to it in its endeavours to properly prepare for the industrial proceedings. 17 My general understanding is that if one examines the respective pleadings, crucial or critical matters for which the plaintiff intends to contend [and which the plaintiff requires to prove] go to the experience, background, history and CV in depth of the defendant, being matters in aid of which the plaintiff seeks, for obvious reasons, to obtain the forensic advantage available on proper discovery. 18 The matter apparently had its genesis on 25 September 2002, where Justice Marks stood over the proceedings until 10 October 2002 to enable a change in legal practitioner for the defendant to be formalised and to speak to one another about this question of discovery. 19 On 10 October 2002, Justice Marks stood the matter over to enable the parties to discuss their respective positions in relation to discovery. 20 On 12 November 2002 counsel for the defendant, Mr Dubler, sent a facsimile to counsel for the plaintiff, Mr Wheelhouse, identifying the suggested documents to be made available by the plaintiff on discovery to the defendant. 21 On 20 November 2002 the solicitors for the plaintiff wrote to the solicitors for the defendant responding to the defendant's suggested list and identifying the categories of documents of which the plaintiff required discovery. The content of that same letter is repeated thereafter on a number of occasions, but there simply is never a response to it received. 22 A further letter in generally the same terms was sent by the plaintiff's solicitors on 6 June 2003. A further and similar letter was again sent on 16 September 2003 from the plaintiff's solicitors. 23 As I have said, the undisputed fact is that no response was received at all, and up to this second, on the evidence, no such response has been received. In response to this first and substantial complaint of the plaintiff, the defendant by his counsel has sought to make the point that in terms of the regulations and rules in force under the Industrial Relations Act 1996, there simply is no automatic right to discovery, and that rule 162 gives the commission power on application of a party, or of its own motion, to order discovery. The proposition put by the defendant's counsel is that no such application was ever pursued by the plaintiff. 24 The second matter of complaint concerns the fact that following the filing by the plaintiff on 28 March 2003 of a cross-claim, the defendant by reason of rule 18A(4) of the IRC Rules 1996, became under an obligation to file and serve a reply to the cross-claim within 28 days. 25 On 22 April 2003, the solicitor for the defendant, Mr Mannix, wrote to the solicitor for the plaintiff advising that he had then received detailed instructions from the defendant to respond to the cross-claim and that counsel would be settling the reply shortly. 26 At a directions hearing before Justice Marks, the defendant stated that it would file a response to the cross-claim within 14 days. The issue of discovery was also noted on the court record. 27 The fact of the matter is that on the evidence presently before the Court, no such reply has ever been delivered nor even produced at the hearing before me. The note of 22 April 2003 appearance taken by Ms Schiff [to be found at the paginated page 59 of her affidavit of 23 March 2004] suggests that the matter [by which I would understand the reference to be to the IRC proceedings, although this is not clear], would be reviewed in three months. It further appears from this note that reference was there made to the delay on the part of the defendant being due to a car accident of Mr Mannix. This matter will be referred to below. 28 Although both counsel in the heavily fought application before me took the Court through every parameter as relevant of this careful chronology, it is not necessary for me to do more presently than to simply a refer a reader of this judgment to the whole of that chronology. Certainly parameters of the chronology are referred to in the affidavits where there is a reference given. The short position is that in my judgment, a careful reading of the chronology discloses a sorry state of affairs in terms of the defendant's generally having failed to attend to the requests to respond to the plaintiff's proposed discovery list items and in terms of the defendant's failing to file the reply to the cross-claim. Nor can it be suggested that the defendant's failure to progress matters stops there. As will appear from what follows, there have been substantial concessions made in this regard. 29 During the hearing before this Court, the defendant by his counsel sought to rely upon two matters in particular. 30 The first concerned the defendant's financial difficulties. 31 The second concerned the back injuries and problems which the defendant's solicitor, Mr Mannix, has regrettably had since May 2003. 32 As to the first of these matters, the defendant has deposed in his affidavit of 25 March 2004 that during 2003 and this present year, he has had financial difficulties because of a downturn in his business activities and because he has also had to pay some of the expenses of conducting the proceedings in this court, the IRC and, of course, the Court of Appeal on the appeal from the stay order granted by Gzell J. 33 He further deposes that he has now acquired funds that will enable him to diligently prosecute the claim in the IRC and that it is his firm resolve to act as swiftly as that court will allow to finalise the industrial proceedings. He deposes that he will be under severe financial pressure if he has to conduct cases in both the industrial court and in this court. Mr Mannix has also deposed to there being a factor militating against a timely prosecution of the industrial proceedings, being the defendant's lack of available funds to meet the expenses of conducting the case. 34 It is said that this position has now changed and that there is now a change in solicitors, or to be such. To be more precise, in his affidavit of 25 March 2004, Mr Mannix deposes that he had spoken to Courtney Poulden, a solicitor of Beilby Poulden & Costello, who had agreed to take over the handling of the defendant's cases, both in this court and before the IRC. Mr Mannix has deposed that he has explained to Mr Poulden the urgency of the matters and that Mr Poulden was able to represent the defendant and would appear in the IRC on the directions hearing on, as I understand it, the 29th of this month. He deposes that Mr Poulden will file the appropriate notices in both jurisdictions today, that is, 26 March, and that he has arranged to meet with Mr Poulden today and to hand the complete file to him; also, that he, Mr Mannix, intends to appear as a friend in the IRC on Monday next to ensure that the Court is apprised of all relevant facts. As a matter of interest, he deposes that he has received from the defendant written instructions to enable a reply to be filed in the IRC proceedings and has arranged to have the reply engrossed, filed and served. 35 As to the second of these matters, that going to Mr Mannix's unfortunate history of disability, he has deposed in his affidavit of 17 March to the following: "2. Since May last year I have been largely disabled by a back injury. I have suffered from spinal problems since 1973. In 1981 I underwent surgery on two occasions. In early May 2003 I started to suffer from acute back pain of a different nature. A CT scan revealed a disc lesion at a level different to that at which I had previous surgical intervention.

3. Dr AP Millar has been treating me for my back problem since about 1977. He provided manipulation, prescribed analgesia and bed rest. He arranged for Dr. Kevin Bleasel to operate on me when I had no choice but to go to surgery. In the episode since May last year I have sought his advice and treatment on numerous occasions.

4. This latest episode has caused me considerable pain and discomfort to the extent that it has seriously affected my ability to work in my practice. I have had to turn away new work and transfer clients because I could not cope. The strong analgesia I take also adversely affects me in this regard.

5. In early October 2003, I contracted influenza and this developed into an infection in my pleural cavity. This episode almost totally incapacitated me for several weeks and I was forced to work from home during this period. Again I was not able to attend to my practice for days on end.

6. In January 2004, I was hardly able to leave the house and I was bedridden much of the time. In February I was forced to close my Castlereagh Street office and work from home. I have since tried to start working from the city in a friend's office space but this too is beyond me. I know I should have asked Alain to seek other representation but I hoped I would be able to cope. I have told him I cannot continue and I am seeking other attorney's who are prepared to take on this claim on the same basis as my retainer." Dealing with the matter 36 What, then, is the appropriate exercise of the court's discretion in the circumstances? I begin by making clear that I regard those circumstances as throwing up a clear and sustained breach by the defendant of the undertaking to diligently prosecute the IRC proceedings. 37 The clear urgency of the application the subject of this judgment is that the IRC proceedings are listed for a default directions hearing on Monday. I sat until 6.30 p.m. last evening to hear these submissions. It does seem to me that it is appropriate at the earliest possible time to deliver this judgment so that Justice Marks on Monday will be in a position to be at least informed of the reasons of the court and the orders that it has made. 38 Enough is enough as far as I am concerned in terms of clarity in what will be, or should be, or is hoped to be, the forward conduct of either these or the IRC proceedings or both. 39 Next, I do not accept that the event of the 28 March 2003 service of a substantial cross-claim in the IRC proceedings, has the suggested significance put forward by the defendant's counsel, of having changed the face of the industrial proceedings. Nor that the defendant may be regarded, when one takes into account the filing of that cross-claim, as having diligently prosecuted the industrial proceedings because of the time that would be needed to come to grips with that cross-claim. 40 In so far as the defendant's counsel has heavily stressed the proposition that the plaintiff itself never applied to the IRC for an order to be made for discovery by the defendant, it is plain enough that no such application was ever advanced. That does not, as it seems to me, affect to the slightest degree, what I have said is a set of circumstances which, clearly proved, throws up a clear breach by the defendant of the undertaking to diligently prosecute the IRC proceedings. There is no suggestion, as I have understood it, that the plaintiff as a party to the IRC proceedings, has impeded the defendant's diligent prosecution of those proceedings or the taking of steps necessary to bring those proceedings on. 41 One then turns to the possibilities, and one then returns to the factors so carefully set out in the President's judgment in the Court of Appeal. To my mind and for the reasons identified by the Mason P, the invidious situation which would obtain if both sets of proceedings were to be continued concurrently remains pervasive. On the other hand, the financial difficulties of the defendant to which I have referred and the problems which, regrettably, the defendant's solicitor has had in terms of his disability and health, simply cannot be regarded as excusing the clear lack of diligence in the prosecution of the IRC proceedings. 42 In the circumstances where one party has failed to comply with an undertaking given as a condition of procuring a stay of proceedings in this Court and where, as here, various matters such as financial difficulties and difficulties of a solicitor in terms of health are put forward as factors to be taken into account, the culpable party often forgets to pay due heed to an extremely important parameter. That is simply that there are two parties to the record, and, further, that the entitlement of the plaintiff in these proceedings to a just approach to its rights must obviously be taken as a given. 43 In short, whilst ever there are attempts to explain away and minimise the effect of breaches of a clear undertaking, it is crucial, it seems to me, for the Court to ensure that there is a level playing field as between the parties. Of course, what the parties are about before me and what they were about before Gzell J and what they were about before the Court of Appeal, concerns on which playing field the proceedings are to be conducted. 44 I confess to having wavered as to the proper exercise of the Court's discretion in the instant circumstances. The Court would likely, it seemed to me, be entirely justified in exercising its proper discretion by simply lifting the stay, which was granted upon a condition which has not been complied with. 45 During the course of the taking of submissions the Court enquired of Mr Wheelhouse, counsel for the plaintiff, as to whether, upon the assumption that the Court would accede to the motion and would lift the stay, there was anything which his client wished to put forward by way of its proposed way forward. For example as to whether the plaintiff could indicate that it would move the IRC for a stay of those proceedings. 46 As I recall it, Mr Wheelhouse was not able to obtain any clear instructions in that regard, and the matter being before the Court late in the evening, that is, of course, understandable. But the point of my interest in the position must be obvious. I was simply endeavouring to, in my mind's eye, see whether or not, if the Court was to lift the stay, it would be likely or possible or practicable, or at least in contemplation, that an application for a stay of the IRC proceedings would follow. Absent being in a position, of course, to be sure of what would happen even if such an application were put to the IRC, it seems to me that I should assume that if I was to accede to the motion presently before the Court, all that would happen would be that the stay presently in force in relation to these proceedings would be lifted. The net result would be that there would be two sets of proceedings covering essentially many of the same issues proceeding alongside one another. 47 The curious circumstance of a race between the parties to then get to a hearing before one or other of the preferred jurisdictions - a situation which obviously should be avoided wherever possible - comes to mind. There is, of course, the circumstance that the plaintiff's hand has been stayed ever since the making of orders by Justice Gzell. In that regard it is appropriate to observe that because of that stay, there never was a defence filed to these proceedings nor directions given for such a defence. 48 Mr Wheelhouse submitted that it was the plaintiff's position that it is now ready to prosecute the Supreme Court proceedings in that all of its evidence had been prepared for over a year and, subject to obtaining a formal order for discovery in these proceedings, the plaintiff was ready to have a hearing in the case virtually forthwith. 49 Whilst that, of course, may be the case, the fact of life is that if and when the existing stay is lifted, the first thing which will have to happen will be a direction given to the defendant to file a defence, and, depending upon the issues thrown up by that defence, the usual exchange of submissions in relation to appropriate discovery will take place. Discovery would ordinarily be the next event and, of course, the necessity for the defendant's evidence to be filed would be thrown up. 50 The chronology also indicates the service of experts' reports and affidavits by the parties before the IRC. Mr Della had filed two affidavits in support of the IRC claims to relief on 10 December 2001 and a further affidavit on 11 December 2001. 51 Generally, as I understood Mr Wheelhouse, his client in terms of the IRC proceedings has filed all of its evidence and had done so by, I believe he said, 26 June 2003. 52 The considerations identified by the learned President in the Court of Appeal judgment, which remain, it seems to me, considerations to be weighed in balance on the present application before me, include the following: · That the IRC proceedings were commenced eight months earlier than these proceedings in a genuine invocation of the Commission's jurisdiction. · That the dispute falls squarely within the scope of section 106, at least in part, and cannot be said to be quintessentially commercial. · That this court lacks the jurisdiction to grant the relief sought by the defendant in the IRC proceedings. · That if the commission avoids or varies the contract, or even just the remuneration aspects of it, this would impact upon any damages recoverable in these proceedings and that other aspects of these proceedings may also be affected by issues determined or orders made in the IRC proceedings. · That affidavits and statements used for one proceeding could likely be used in relation to the issues remaining to be determined in the other. · That to allow both proceedings to press on together risks wasteful duplication of judicial resources and inconsistent judicial determinations. · That if possible it was desirable to avoid an unseemly race to judgment between the two sets of proceedings in circumstances where the Court took into account the legitimate forensic interests of both parties in the administration of justice is significant. · That if these proceedings were completed first, there could well remain issues to be decided in the IRC proceedings. 53 On my findings, it is tolerably clear that the defendant's financial circumstances have played a very considerable part in what I regard as the sorry state of affairs which has arisen. Yet there is sworn evidence before the Court by the defendant that he has now acquired funds that will enable him to diligently prosecute the claim in the IRC proceedings and, as I have said, there is now evidence before the Court following the several changes in legal representation by the defendant, that yet another new firm of solicitors, as I understand it, will have today been retained for the purpose of taking over conduct of both sets of proceedings from Mr Mannix. 54 One of the concerns which the Court has and which must be obvious is as to whether, and if so for how long, the defendant's apparently new-found acquisition of funds will permit the diligent prosecution of the IRC proceedings. If the past is any indicator, it would seem unlikely that the defendant is going to be in a position to do that. If the past is a reliable indicator, it would seem that the future will see a continued set of difficulties in the defendant complying with the IRC proceedings timetable, even if there is a final hearing soon ordered in that regard. 55 All of these matters are matters for the genuine concern of the court seeking to strike a proper balance between the legitimate interests of the plaintiff and the legitimate interests of the defendant. Clear it is that if the Court now lifts the stay the defendant, as he swears, will be under severe financial pressure, being required to conduct cases in both courts. 56 My own view is that subject to one matter to which I will refer in a moment, the proper approach to the instant application is to very squarely focus upon the significance to Gzell J and to the Court of Appeal of the fact that the stay was subject to conditions requiring the expeditious prosecution of the IRC proceedings and that the stay orders contemplated recommencement of these proceedings in the event that those conditions were not complied with. That was then, and remains, a very important parameter. 57 In short, the price which the defendant paid for obtaining the stay was its undertaking to comply with those conditions. 58 My own view in all of the circumstances, is that the "enough-is-enough" principle should be applied, but on the following basis. The proper exercise of the discretion is to give to the defendant one only last chance to progress the industrial proceedings. This can be achieved by an order that the stay of proceedings be lifted but staying of the operation of this order for a particular period upon the basis that if, during that period, the defendant can procure from the IRC, a date for the final hearing of the proceedings before the IRC, then the order lifting the stay order will be vacated. 59 In those circumstances, the onus will be upon the defendant to procure from the IRC a final hearing date, and if the defendant cannot procure from the IRC a final hearing date within the period to be stipulated, the lifting of the stay order will come into force with the regrettable but, it seems to me in that circumstance, entirely necessary consequence that both sets of proceedings will then continue on foot. 60 That being, it seems to me, the proper exercise of the court's discretion, the only question is what should be the period of the stay of the operation of the order lifting the stay. The answer to that question is, it seems to me, not an easy one. 61 I take into account the fact that, presumably, in order to procure a final hearing date from the IRC, the defendant will need to be in a position to establish that it is ready, or reasonably ready, for the hearing. I am unaware as to whether or not the IRC will require that the defendant file a reply to the cross-claim. If it be that that will be a requirement of the IRC, then in terms of the evidence presently before the Court, with the new solicitors a reply should be filed very shortly, since the defendant's written instructions to enable a reply to be filed have been given and Mr Mannix has arranged with Mr Poulden to have the reply engrossed, filed and served. 62 If it is to be a requirement of the IRC before it fixes a final date for the hearing of the proceedings before it, that all evidence by the defendant in response to the plaintiff's cross-claim be filed, then, presumably, the defendant will simply have to, in the very immediate future, spend every sinew and considerable funds, in getting that evidence together. 63 All of those matters may require to be attended to by the defendant in order to procure a final hearing date from the IRC, but it seems to me that the defendant has brought all of this upon itself. 64 Doing the best that I can in all of the circumstances to identify a period of time during which it would be appropriate and proper in the exercise of the court's discretion to stay the operation of the order lifting the existing stay, it seems to me that that period should be 28 days and not a day longer. 65 In those circumstances, and for those reasons, the Court makes the following orders:

1. I make an order in terms of paragraph 1 of the notice of motion filed on 4 March 2004 by the plaintiff.

2. I order that Order 1 be stayed for a period of 28 days from 26 March 2003.

3. I grant liberty to the defendant to apply for Order 1 to be vacated if, and only if, a final hearing date of the IRC proceedings is given by the IRC on or before 28 days from 26 March 2004.

4. I order that the defendant pay the plaintiff's costs of the motion filed on 4 March 2004.

I certify that paragraphs 1 - 65 are a true copy of the reasons for judgment herein of the Hon. Justice Einstein given on 26 March 2004 ex tempore and revised on 21 April 2004

      Susan Piggott
      Associate

21 April2004

Date Court Event Required Action Failure Evidence Reference 10 April 2001 L&W Development's solicitors Ernst & Young Law write to John Walsh & Partners, Mr Della's solicitors outlining breaches by Mr Della. 1 May 2001 Alain Della removed as director of L& W Development by shareholders' resolution. 10 December 2001 IRC Summons for relief under section 106 filed by Mr Della. Also 2 affidavits in support. IRC Applicant issues Notice to Produce to the Respondents returnable 11 Dec 01 requesting inter-alia, copies of all bank statements of L & W Development and Peter Li 11 December 2001 IRC Further affidavit of Mr Della sworn. 11 and 14 December 2001 IRC Hearing before Marks J on application for interlocutory injunction. Pages 0044-0051 December 2001 IRC Applicant issues Notice to Produce to Third Respondent returnable on 14 Dec 01 requesting copies of all bank statements of Roseley Enterprises, all documents relating to or evidence in the loan accounts, and all document relating to or evidencing the transfer of money.

12 December 2001 IRC Applicant issues Notice to Produce to First and Second Respondents seeking documents relating to loan accounts between L&W Development and Roseley Enterprises and documents relating to transfer of money from L & W Development to Roseley Enterprises Pty Ltd IRC Respondents' Notice to Produce to the Applicant IRC Applicant files Notice of Motion to amend summons to join Roseley Enterprises. 21 January 2002 IRC Reply to amended summons for relief filed by the Respondents 25 January 2002 IRC Amended summons for relief under Section 106 filed by Mr Della. 14 March 2002 IRC Response to Reply filed by the Applicant 13 May 2002 IRC Conciliation conference before Justice Marks. Conference stood over for 7 days to allow enquiries to be made about the rental claim and to let Mr Della produce the relevant documents in support of the claim that he paid L & W's rent. 23 May 2002 IRC AMT advised IRC their client instructs that the matter cannot be resolved.

5 July 2002 IRC Further conciliation before Justice Marks. Mr Dubler appeared for Mr Della, Mr Gye for the respondents. Draft timetable provided to Mr Dubler. Proceedings stood over to enable the parties to file an agreed timetable. 9 July 2002 IRC GAL writes to John Walsh and Partners requesting a timetable. No response received. Produce timetable No response received 21 August 2002 Supreme L & W development commence Supreme Court proceedings against Mr Della (SC No. 50143/02) ("SC Proceedings"). 19 September 2002 IRC GAL write to Mr Carney advising of directions hearing on 25 September 2002, seek confirmation that he is acting. No response received 20 September 2002 IRC GAL file Notice of Motion in IRC on behalf of Respondents seeking a stay of the IRC proceedings pending determination of the SC Proceedings. Registry advise AMT still solicitors on the record for Mr Della. AMT served with Notice of Motion and affidavit in support. 24 September 2002 IRC AMT serve a Notice of Ceasing to Act and confirm that they forwarded the Notice of Motion and affidavit in support to Mr Della.

IRC GAL fax to Mr Carney enclosing IRC Notice of Motion and affidavit in support and seek confirmation that he is now acting. No response received 25 September 2002 IRC IRC directions hearing and return of respondents' motion. Mr Della appears for himself and advises that Mr Dubler of Counsel is briefed, and that Mannix Lawyers will file notice of acting that day. Mr Della advises that he wants discovery and hands up a letter dated 10 September 2001 purportedly sent from John Walsh (never on the record) to GAL seeking discovery of numerous categories of documents. Scot Wheelhouse of Counsel advises Justice Marks that he is instructed no such letter was ever received by GAL. Justice Marks stood the matter over to 10 October 2002 to enable Mannix lawyers to get on the record, and Mr Wheelhouse to talk to Mr Dubler about the matter.

10 October 2002 IRC Mention of the matter before Justice Marks in the IRC. Mr Mannix appears for Mr Della, Mr Wheelhouse for L&W. Mr Wheelhouse advised His Honour that he did not want him to consider the respondents' stay application until they were in a position to tell the IRC Court that L & W are ready to proceed to hearing in the Supreme Court proceedings. Justice Marks stood the matter over to enable the parties to discuss their respective positions vis a vis discovery. IRC Mannix Lawyers file Notice of Appearance for Mr Della. 21 October 2002 IRC Mannix writes to GAL enquiring about the Notice to Produce issued to Della and the documents which still require production. GAL responds on 22 October 2002. 8 November 2002 Supreme Hearing of Stay Application before Gzell J. Stay ordered Pages 0001-0004 12 November 2002 IRC Fax Mr Dubler of Counsel to Mr Wheelhouse of Counsel re proposed directions. Pages 0052 -0054 13 November 2002 IRC Della files Motion for Expedition 20 November 2002 IRC GAL writes to Mannix about discovery in response to Mr Dubler's fax at item 30. Discovery No response. Affidavit of T Schiff 23 March 2004 Pages 0055 - 0058 27 November 2002 IRC Appearance before Marks J- matter stood over to 3 February 2003. 5 December 2002 IRC Li and Roseley file Motion to be removed as parties to the proceedings. Returnable on 3 February 2003. No evidence filed in Reply by Della Affidavit of T Schiff 23 March 2004 Affidavit of Mohammed Harris filed by L & W development. 5 December 2002 IRC L & W issue summons for production addressed to Sutherland Shire Council returnable 19 December 2002. 14 January 2003 IRC Statement of Peter Li (copy of Supreme Court statement) filed for Respondents and served. No evidence filed in Reply by Della Affidavit of T Schiff 23 March 2004 Further Affidavit of Peter Li filed for Respondents and served. 3 February 2003 IRC Hearing before Marks J. Declined to order expedition. Stood over Respondents' motion for removal until hearing of the matter. Proceedings stood over generally. 3 February 2003 IRC Mr Della issues summons for production addressed to Citibank Pty Limited. Returnable 13 February 2003. 17 February 2003 IRC Applicant Della files Further Amended Summons 20 February 2003 IRC L & W issue summons for production addressed to Union Pacific Pty Limited. Returnable 6 March 2003. 27 March 2003 IRC Statement of Wlodek Kozlowski (copy of Supreme Court Statement) filed by Respondents. Served 22 April 2003. No evidence filed in Reply by Della Affidavit of T Schiff 23 March 2004 28 March 2003 IRC Cross Claim under Section 106 filed by Respondent L & W Development and served. Rule 18A (4) of IRC Rules 1996 Cross Respondent Della to file and serve a Reply to the Cross Claim within 21 days. No document filed by Della Affidavit of T Schiff 23 March 2004 22 April 2003 IRC Letter from Mannix to GAL stating have detailed instructions and will file Reply to Cross Claim Affidavit of T Schiff 4 March 2004 Page 00337 1 & 8 May 2003 Court of Appeal Hearing of L & W Development's appeal of the orders of Gzell J (stay) 12 May 2003 IRC Expert Report of Robert Bendeich filed by Respondent and served No evidence filed in Reply by Della Affidavit of T Schiff 23 March 2004 5 June 2003 Court of Appeal Judgment of Mason P, Giles JA, and Santow JA dismissing Appeal Affidavit of T Schiff 4 March 2004 Pages 0005-0032 6 June 2003 IRC GAL letter to Mannix requiring discovery of certain categories of documents previously requested within 14 days. Discovery by Mr Della No response Affidavit of T Schiff 4 March 2004 Pages 0038-0040 26 June 2003 IRC Respondent L & W files and serves Reply to Further Amended Summons for Relief Rule 18A (5) of IRC Rule 1996, Applicant Della within 14 days file and serve a Response No document filed by Della. Affidavit of T Schiff 23 March 2004 11 September 2003 IRC Directions Hearing before Marks J. Applicant says would file Response to Cross Claim within 14 days. Issues of discovery. Noted on Court Records. Direction noted on Court file. "Reply to Cross Claim to be filed within 14 days. No document filed by Della Affidavit of T Schiff 23 March 2004 Page 0059 16 September 2003 IRC GAL letter to Mannix confirming Reply to Cross Claim due 26 September 2003 and requiring discovery of categories of documents previously requested. Discovery by Mr Della No response Affidavit of T Schiff 4 March 2004 Filing of Reply to Cross Claim by Mr Della Pages 0041-43 29 March 2004 IRC Matter listed for a default directions hearing. Affidavit of T Schiff 15 March 2004

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