Nilac Pty Ltd v Cain Building Group Pty Ltd (in liq)

Catchwords: PROCEDURE – application to vacate hearing date – revisiting informal ruling made five weeks earlier – no material change in circumstances – no demonstrated incapacity to prepare for trial – prejudice to other parties because applicant an undischarged bankrupt – application dismissed

Legislation Cited: Bankruptcy Act 1966 (Cth) s 58

Category: Procedural rulings

Parties: Nilac Pty Ltd (Plaintiff / First Respondent to the motion)
Cain Building Group Pty Ltd (in liq)
Nicholas Patrick Cain (Second Defendant / Applicant on the motion)
Karen Anne Cain (Third Defendant / Second Respondent to the motion)

Representation: Counsel:
J Hutton SC (Nilac)
M Luitingh (Nicholas Cain)
M Klooster (Karen Cain)
Solicitors:
Cooper Grace Ward Lawyers (Nilac)
A J Lucas Group Ltd (Nicholas Cain)
Jane Button & Associates Pty Ltd (Karen Cain)

File Number(s): 2022/00174968

Publication restriction: Nil

Ex tempore JUDGMENT

1. LEEMING JA**:** By motion filed on 2 June 2025, the second defendant to these proceedings commenced slightly more than three years ago, Mr Nicholas Patrick Cain, seeks among other things that the hearing be vacated and the matter set down for a trial at some later date. The trial was set down for hearing to commence on 28 July 2025 with an estimate of five days. That happened as long ago as 15 November 2024, itself somewhat more than two years after the proceedings were commenced.

2. As Mr Luitingh who appears for Mr Cain has emphasised, the allegations in the litigation are of the utmost seriousness. Red blooded fraud is alleged against him, and it is rightly said that if on the civil standard the plaintiff’s allegations of overcharging and theft of materials are made out in full, then he would be exposed at least to the risk of the papers being referred to the authorities with a view to prosecution.

3. There are two aspects to the explanation put forward in support of the vacation of the hearing today. The most immediate is the personal circumstances of two of the legal practitioners involved. The third defendant to the litigation is Mr Cain’s wife, Ms Karen Anne Cain, and I accept what has been said from the Bar table that her solicitor has been placed in a situation of utmost personal difficulty over the last few days. Moreover, Mr Luitingh who appears for Mr Cain himself has been ill-disposed: he has been able to appear today by AVL link and has advanced submissions with appropriate force, but I accept what he says that for a period of time in recent days he has been incapacitated.

4. However, the difficulties in the personal circumstances of two of the legal practitioners acting for the defendants in the last fortnight fall well short of establishing that nothing could have been done to prepare Mr Cain’s case since his motion last came before the Court on 6 June so as to establish a material change of circumstances from the position on that occasion.

5. The more substantial reason for the delay put forward in the material is the fact that Mr Cain is presently an undischarged bankrupt. That happened by sequestration order made on 4 December 2024 upon a debtor’s petition filed on 29 November 2024. At that stage, s 58 of the Bankruptcy Ac**t 1966 (Cth) had the effect of staying further against him in the proceedings. That stay remained in place until, on 28 May of this year, the plaintiff was granted leave to proceed against him by a federal court. During the period of his bankruptcy prior to the grant of leave, Mr Cain appears not to have taken steps to progress the matter. In particular what has been emphasised today is the failure to take steps to respond to the expert evidence supplied by the plaintiff towards the end of last year, a couple of months before his bankruptcy. In short, Mr Cain’s bankruptcy as an explanation for vacating the hearing does not address the time before Mr Cain became bankrupt, nor does it address the time after the plaintiff obtained leave to proceed against him. Most fundamentally, this was prominent when the application last came before this Court.

6. The motion came before Stevenson J on 6 June 2025. The motion not merely seeks to vacate the hearing, but also seeks a raft of other orders, concerning filing evidence, issuing subpoenas and notices to produce, granting access to the property to experts, and so on. Stevenson J dealt with it in informal but unequivocal terms:

HIS HONOUR: … As to the evidence, I don’t propose to give your client leave to do anything. If he wants to serve evidence that he would seek to rely upon, then he can do that, and he can then make an application to rely upon that particular evidence, and I’ll hear or someone here will hear submissions as to whether that is to be permitted. I’m not going to give leave in advance, so that’s that.

Access to the extra property, if there’s evidence from an expert as to why the expert needs access, I’ll think about that. Notices to produce. You can issue a notice to produce. You can issue subpoenas. I’m not going to give you leave to do it in advance. You can ask for all the particulars you like, and I’m not going to vacate the hearing date. That’s where we are. It’s not good enough. Your clients have had every opportunity to adduce this evidence, and I’m not, at this stage, going to impose upon the plaintiffs the severe prejudice of vacating the hearing date, so tell them to get cracking. They can circulate proposed evidence, and someone here - it won’t be me - will hear any application your client wants to make to rely upon that evidence, but if the plaintiff can’t meet it, if I were the decision maker, it wouldn’t be allowed, and that’s not a preliminary view. That’s what I’m doing. What do you want me to do with your motion? Stand it over for a few weeks while you serve your evidence?

7. The notice of motion was stood over until today. Mr Cain advised that, once again, he sought to vacate the hearing. Accordingly, I directed argument in the first instance to paragraph 9 which seeks a vacation of the hearing. In light of the seeming lack of finality in what had occurred on 6 June I proceeded formally. Aside from what was said from the Bar table concerning the incapacity of two of the legal practitioners, Mr Cain relied only on an affidavit made in late May, which had been before Stevenson J, and the plaintiff read the same affidavit in response which had been before his Honour.

8. Thus I am asked today to revisit what Stevenson J had unambiguously rejected on the last occasion. Aside from the two matters of incapacitating medical conditions suffered by Ms Cain’s solicitor and Mr Luitingh who is Mr Cain’s counsel, the evidence otherwise is precisely that which was before Mr Stevenson. I have heard various submissions about what has happened and statements that there has been a deal of industry and indeed draft reports have been supplied but none of that is before me.

9. Even if there were nothing more, I would be most reluctant to conclude that there has been anything like a material change of circumstances warranting this Court coming to a different view from that which was so firmly and, if I may say so, obviously correctly determined by Stevenson J five weeks ago. The material which I accept and which I have only been told from the Bar table concerning the incapacitating personal circumstances of two of the legal practitioners, one of whom is directly involved, the other less directly involved in the preparation of Mr Cain’s case, on no view explains either why there has been some material change in what was disclosed by Mr Cain's affidavit of 29 May 2025, nor does it explain or confirm the level of industry that has been spoken of during addresses today.

10. Various other facts tell against vacating the hearing. There is the fact that Mrs Cain does not support the application to vacate (nor does she oppose it) while the plaintiff does oppose it. Next, there is the not insignificant matter that Mr Cain is an undischarged bankrupt. As Mr Luitingh candidly acknowledges, he is not in a position to in any way address the obvious and immediate prejudice occasioned by the order that he seeks vacating the hearing. There is not even leave to take any further steps in the event that some extra costs order is made against him and of course his trustee in bankruptcy is not before me. There is no suggestion of any undertaking to pay any or all of the costs thrown away by or occasioned by the vacation of the hearing date which as I have said was set down some nine months ago.

11. Instead at the forefront of the submissions is the seriousness of the allegations made by the plaintiff against him. The difficulty with accepting that submission is that there has been no change to the Commercial List Statement that was filed more than three years ago. At all times Mr Cain has been aware of the seriousness of the allegations put forward by the plaintiff. What is more, I have indicated a disposition – no more than that – that if there is, as is put by Mr Luitingh although necessarily in the abstract in the absence of evidence, critical or material evidence that is sought to be adduced on his behalf then notwithstanding the orders that have previously been made I would be minded to accede to its being adduced subject of course to the other parties’ entitlement to demonstrate irremediable prejudice. I do not regard that stance as materially different from what Stevenson J said on 6 June: the key question will be whether the plaintiff can meet the late evidence.

12. At the moment, argument has proceeded in the abstract. I do not know the nature (except that apparently they are voluminous) of the reports that have been served in draft how long it would take to respond to them. It is not possible to address those matters which turn upon their granular detail in the abstract. What I have said is sufficient to explain why I have concluded that nothing has been put forward today to warrant my taking any different approach than what Stevenson J expressed on the last occasion.

13. For those reasons, paragraph 9 of the notice of motion will be dismissed.

14. [Discussion of procedural steps to be taken to ready matter for hearing]

15. The following orders will also be made:

2. To the extent necessary, vary the existing orders to permit the second defendant to file and serve further lay and expert evidence on or before 4pm on 17 July 2025.

3. Order 2 is without prejudice to the entitlement of other parties to object to the late service of that evidence.

4. Direct the plaintiff to file and serve a court book including a judge’s working copy to be supplied to Level 12 of this building by 4pm Wednesday 16 July 2025.

5. Stand the matter over before me for further directions at 10am Tuesday 22 July 2025.

6. Stand over the balance of the notice of motion filed 2 June 2025 to the directions hearing on 22 July 2025.

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