Nitopi v Nitopi - [2021] NSWSC 669 - NSWSC 2021 case summary — Zoe

Nitopi v Nitopi - [2021] NSWSC 669 - NSWSC 2021 case summary — Zoe

Christina Nitopi is Giuseppe Nitopi's mother. Mrs Nitopi sues her son for restitution, damages for deceit and equitable compensation claiming an amount of $6.5 million. That claim is said to arise out of a series of oral agreements made between Mrs Nitopi and her son between 1999 and 2009 pursuant to which Mrs Nitopi, at the request of Mr Nitopi, borrowed $5,100,000 from the ANZ Bank upon the security of her property at 280 Garfield Road, Riverstone. Mrs Nitopi alleges that she then advanced that money in various tranches to Mr Nitopi to assist him with his personal business concerns. It is alleged that Mr Nitopi agreed that in consideration of these advances to him, he would make all repayments to the bank, presumably including principal and interest, and effectively keep his mother indemnified against any claim that the bank may have against her for the recovery of her borrowings. Mrs Nitopi alleges that in all of this she was misled and deceived by her son who, in breach of the alleged agreements, did not repay any monies to the bank in discharge of her indebtedness, with the result that the bank appointed a receiver of the property and sold it to realise its security.
Mr Nitopi denies these claims or that he ever received any monies from his mother pursuant to any such agreements or indeed at all. Moreover, Mr Nitopi has filed a further amended cross-claim dated 14 June 2017 against his mother alleging in general terms that, contrary to her allegations, he and his sister agreed to develop the property in return for a share of the amount by which the value of the property was thereby increased. Mr Nitopi alleges that he contributed $1,000,000 of his own money to that endeavour. He therefore claims that he is entitled to the repayment of monies expended by him, as well as damages for breach of contract in an amount exceeding $5,000,000.
The proceedings have a long and somewhat languid history in this Court since their commencement in 2015, with extended periods of relative inaction interrupted by occasional enthusiastic episodes or litigious fervour. Among other things that have occurred, on 5 April 2018 R A Hulme J ordered that the proceedings be dismissed on Mr Nitopi's application to dismiss his mother's claim for want of due despatch. That decision was set aside on 18 April 2019 by the Court of Appeal: see Nitopi v Nitopi [2019] NSWCA 81. In some respects, Mr Nitopi's present concerns seek to reprise his application to R A Hulme J inasmuch as he persists in maintaining that his mother's egregious delays continue to cause him significant prejudice.
Mr Nitopi alleges that on 22 July 2017, important documents were stolen from his home in Drummoyne. In his 12 June 2019 affidavit, Mr Nitopi described these documents as "the majority of personal and business records since 1998". Unfortunately, little detail about these documents is provided. For example, the best that can be said is to be found in paragraphs 13 to 15 of Mr Nitopi's affidavit as follows: "13. On 22 July 2017, my home was forcibly broken into and ransacked. Personal property of mine was stolen including my coin collection; note collection; jewellery that belonged to me and my two children; personal items left to me by my grandfather, grandmother, and father; cash; as well as files containing documents relating to the family estate matter and the commercial matter that my mother had commenced against me. 14. The documents that were taken were stolen from two, full, locked filing cabinets at my premises at Drummoyne. I do not remember every single document that was contained in those filing cabinets, but it was the majority of my personal and business records since 1998. For instance, all business documents relating to past tenants at 280 Garfield Road, Riverstone including, but not limited to, tenant's leases, bank and deposit reconciliations, deposit and cheque books, and all files relating to each of the individual tenants, which contained details about their various leases and negotiations leading up to those leases as well as renewals, extensions and evidence of collection of rental. 15. Most of my records relating to cheques that were passed onto my mother and sister in my capacity as the Property Manager were also taken in this home robbery. These documents were going to be used by me in my cross claim against my mother and sister, and included evidence of monies that I had spent to improve the property, which I had undertaken using the proceeds from building materials and equipment that had been left to me by my father as part of Family Law Orders on 6 November 1996."
Mr Nitopi's mother has recently been found guilty by a Magistrate on charges of break and enter and conspiracy. Mr Nitopi maintains that Mrs Nitopi's convictions relate to a break and enter at his home and that the documents that were stolen from him were stolen by her.
In order to make good that contention, Mr Nitopi relies upon the affidavit of his solicitor, Sam Parisi, sworn on 31 May 2021. Mr Parisi deposes to the fact that, after an investigation by the police, criminal charges were laid against Mrs Nitopi and her brother Michael Portello. A Court Attendance Notice annexed to his affidavit contains details of nine offences, including a charge that Mrs Nitopi was an accessory before the fact to attempted break-ins and break-ins at Mr Nitopi's Drummoyne premises in June, July, August and December 2017. Mrs Nitopi is scheduled to be sentenced in the Burwood Local Court on 21 June 2021.
In support of Mr Nitopi's complaints in this application about his mother's delays, Mr Nitopi relies on the following paragraphs of Mr Parisi's affidavit as follows: "6. The two main factors which have caused delay in the running of this case have been the Plaintiff and the Second Cross Defendant repeatedly changing their legal representation, which has caused delay due to the new representatives having to inform themselves of the matter and, often, seeking to make changes to pleadings. It has also meant that requests for documents or Notices to Produce have not been attended to in a timely fashion, often due to the fact that previous solicitors have held onto their files by way of liens. 7. The second factor which has caused delay has been the theft of the Defendant's documents as a result of two robberies that happened at his residential home at Drummoyne between June 2017 and December 2017. The Defendant was also the victim of two attempted break-ins during that period. Part of the material which has been stolen includes original documentary evidence which is in support of the Defendant's claim. The Defendant has previously provided an affidavit sworn on 12 June 2019 which outlines the categories of evidence that were stolen."
In the hearing of this application, neither Mr Nitopi nor Mr Parisi was cross-examined. Nor was any objection taken to their affidavits. It is therefore reasonable for present purposes to infer that Mrs Nitopi does not contend that Mr Nitopi did not lose certain documents in the break-ins to his Drummoyne premises and that some of them at least were documents upon which Mr Nitopi might wish to rely in these proceedings.
However, Mrs Nitopi does not accept either that she was involved in these breaks-ins or attempted break-ins. Even though it is accepted by her counsel that she has been found guilty of these offences, I am informed that Mrs Nitopi intends to appeal to the District Court against her convictions. I remain unaware of the basis for any such challenge.
Mr Nitopi's application relies upon two decisions of this Court: Palavi v Radio 2UE Sydney Pty Ltd [2011] NSWCA 264 and Clark v State of New South Wales [2012] NSWCA 139. Palavi concerned a finding that the plaintiff had deliberately destroyed two mobile phones belonging to her that were discoverable and relevant to a defence of truth pleaded in her claim for damages for defamation. Clark concerned the destruction of a cassette tape by the plaintiff which would have been determinative of an allegation by the plaintiff that a policeman had solicited a bribe from him in order to refrain from charging Mr Clark.
Referring to the decision of Johnson J at first instance, the Court of Appeal in Clark said this: "[47] His Honour then summarised the relevant principles as follows: '100 The principles surrounding the consequences of destruction of potential evidence by a party have emerged largely from cases where destruction has occurred before the commencement of proceedings. 101 Applications for a stay or dismissal of proceedings (Fuji) or entry of a verdict for the defendant (British American Tobacco Australia Services Limited v Cowell) have not been granted. Where destruction of potential evidence or fabrication of evidence has occurred after proceedings have commenced (Arrow Nominees), dismissal of proceedings has been ordered. In cases where material is intentionally suppressed but is finally produced (Logicrose), the Court has taken the view that the Court's processes have not been defeated and that the proceedings should be allowed to proceed. 102 In other cases, the issue has been left to the drawing of inferences adverse to the party who has destroyed the material prior to trial, applying the principles in Allen v Tobias and Katsilis. Whether an adverse inference will be drawn, and the strength of the inference, will depend upon the particular circumstances of the case. In a clear case of conscious destruction of material which was likely to be used in evidence, a strong inference adverse to the destroying party may be drawn with the ultimate inference being of the type referred to in Marsden v Amalgamated Television Services Pty Limited. 103 However, the remedies available in such circumstances are not confined to the drawing of appropriate inferences. If the conduct of the destroying party may be characterised as an abuse of process, then the power of the court to stay or dismiss proceedings may be utilised in an appropriate case. This power is to be exercised sparingly. 104 Ordinarily, a party is entitled to initiate and continue proceedings with the court determining those proceedings on their merits. Where, however, a party to proceedings intentionally destroys material which is significant to the determination of the proceedings, and such destruction occurs after the proceedings have been commenced, then a clear foundation would appear to exist for the court to call in aid its power to stay or dismiss the proceedings. The court will have in mind the interests of the individual parties to the civil proceedings, but also the protection of the administration of justice and the integrity of the courts and the system of justice generally. Resolution of an application for a stay or dismissal of the proceedings will consider the question whether a fair trial may take place in the absence of the destroyed material even where an appropriate inference may be drawn adverse to the destroying party.' His Honour's statement of principle was approved in Palavi v Radio 2UE Sydney Pty Ltd [2011] NSWCA 264 at [93]."
Unlike this case, Clark concerned an application made to Johnson J for an order staying or dismissing the proceedings generally pursuant to UCPR 13.5. In Palavi, the issue was whether the trial judge was correct to strike out certain imputations in the plaintiff's statement of claim upon the basis of her destruction of the mobile phones.
In these circumstances, Mrs Nitopi submitted that I am essentially being asked on an interlocutory basis whether she has engaged in serious criminal conduct and was thereby responsible for the destruction of the material about which Mr Nitopi complains. The evidence about that goes no further than that Mrs Nitopi has been found guilty of two of nine charges referred to in a Court Attendance Notice which she proposes in any event to contest. Mr Nitopi has failed to identify the material, in the form of documents that he claims were stolen, with precision and none of Mr Nitopi's evidence goes any way towards demonstrating the relationship that these documents are alleged to have to his defence of Mrs Nitopi's claim or the prosecution of his cross-claim. Nothing in evidence before me identifies or establishes the existence of a critical or essential connection between these vaguely described documents and Mr Nitopi's forensic position.
It also seems to me that Mr Nitopi's reliance on UCPR 14.28 is misplaced. He does not attack the adequacy of the current version of the statement of claim or contend that the pleading discloses no reasonable cause of action or that the pleading has a tendency to cause prejudice, embarrassment or delay in the proceedings. He also does not claim that the pleading is otherwise an abuse of the process of the court. Mr Nitopi is really asking for a stay of the proceedings upon the basis that his mother's criminal conduct, yet finally to be determined by a foreshadowed appeal and allegedly involving the destruction of documents that are essential to his position in this litigation, even though not identified with any precision, parcelled up as an application for dismissal for want of due despatch.
In this last respect, Mr Nitopi continues to assert that his mother is in effect guilty of inexcusable and substantial delay. The evidence about that is less than satisfactory. In any event, the fact that R A Hulme J's order was set aside by the Court of Appeal means that any delays up to that time can be disregarded. The significance of any post-18 April 2018 delays was considered and rejected on 25 September 2020 by Registrar Jones in her determination of a similar application, largely in the light of the criminal charges that Mrs Nitopi was then facing.
In my opinion it is instructive to recall the following observations of the Court of Appeal when considering R A Hulme J's order dismissing the proceedings: "18. Although the primary judge observed that he had been given to understand that the proceedings were 'not complex', it is not difficult to imagine that the documentary evidence may be extensive. The Court does not have before it on the leave application either the current (or any) version of the statement of claim or the cross‑claim. It appears not to be in dispute that the plaintiff obtained bank loans secured against an industrial property in an amount exceeding $6 million. The issues appear to involve counter allegations as to who received the moneys, who was obliged to make payments under the mortgages and for whose benefit the moneys were obtained. The sum involved in the claim is not insignificant. Although there is no evidence as to the amount involved in the cross‑claim, the Court was informed by counsel that it was in excess of $5 million. 19. The plaintiff's written submissions noted that while the defendant is keen to have the plaintiff's proceedings dismissed, there is no suggestion that the cross‑claim will be withdrawn. Based on the explanation given by counsel for the defendant in this Court, the cross‑claim is likely to proceed and it is at least possible that a number of the issues between the parties with respect to the same business arrangements which are apparently intertwined will be litigated in any event. There is a real possibility of injustice to the plaintiff if her claim is not to be heard. The plaintiff also noted that the defendant has been in default with respect to directions in relation to his cross‑claim. 20. It appears that the evidence of the plaintiff was ultimately filed three days after the date provided by way of the last directions, but it had been filed by the time the motion to dismiss the proceedings was heard. The judge was informed that a final version of the plaintiff's affidavit, together with annexures, was provided very shortly before the hearing. Accordingly, the pleadings with respect to the plaintiff's claim were complete and the evidence‑in‑chief had been filed. The matter was not ready for hearing, but that was because the defendant had not filed his evidence and the cross‑claim was not ready to be heard. The purpose of dismissal proceedings is not limited to policing non‑compliance with interlocutory orders. 21. In these circumstances it would appear that, although the plaintiff seeks leave to appeal from a procedural ruling, she has reasonably good prospects of success and it cannot be said that the proposed appeal is merely arguable. 22. Further, although it is three years since the proceedings were commenced, the fact that there have been regular and detailed communications from the plaintiff's solicitors to the defendant's solicitors throughout that period is, on its face, not consistent with an allegation that the delay is totally unexplained. 23. There is no dispute that the amount involved is a considerable sum for individual litigants. Nor was there any attempt by the defendant to demonstrate that the plaintiff's substantive claim was not reasonably arguable."
It seems to me that there are several reasons why the present application cannot succeed. Fundamentally, Mr Nitopi has not established that his mother's criminal convictions equate to the destruction of his documents by her, even assuming favourably to him that he has satisfied me what those documents are and that they are critical or relevant to him in these proceedings. More generally, particularly considering the cautious approach adopted by the Court of Appeal in 2019, it is not appropriate at an interlocutory stage to strike out Mrs Nitopi's pleadings or dismiss the proceedings. Such a course should only be contemplated in the clearest of cases, of which the present case is not an example.
It follows that Mr Nitopi's application should be dismissed with costs.