Plaintiff v Defendant

The appeal

1 The plaintiff, Melbourne Estate Agents Pty Ltd, has appealed pursuant to s 148(1) of the Victorian Civil and Administrative Tribunal Act 1998 from orders made on 28 February 2005 dismissing an application under s 120 of that Act seeking to review a decision made in its absence by the Victorian Civil and Administrative Tribunal (VCAT) on 24 January 2005.

Background to the appeal

2 By application dated 21 December 2004 filed at VCAT, Mr Romanos had sought damages in the sum of $9,450.00 for alleged false and misleading misrepresentation which constituted contraventions of the Fair Trading Act 1999 and an order setting aside an exclusive auction authority which he had given to Melbourne Estate Agents Pty Ltd.

3 The matter came on for hearing before the Tribunal on 24 January 2005. Melbourne Estate Agents Pty Ltd was not present at the hearing. By letter faxed at 1.05 pm to the Tribunal on 24 January 2005 the solicitors acting for Melbourne Estate Agents Pty Ltd advised VCAT as follows:

"We advise we act on behalf of Melbourne Estate Agents and have been advised by Mr Paul Violi at 12.15 pm this day, that a matter has been listed for 2.00 pm this day. Whilst neither our client nor our office has been served with the application we understand that it pertains to matters presently listed for hearing in the Melbourne Magistrates' Court on 2 February 2005. No stay has been sought or granted in respect of these proceedings that were issued on 11 May 2004. Our client is unable to attend at 2.00 pm this day on such short notice and we are unable to obtain instructions as stated, as our client has not been served. Finally, we note that the applicant made an application to file a counter-claim in the Magistrates' Court on 18 August 2005 and failed to do so, the Magistrates' Court has jurisdiction to hear and determine any matter arising out of the parties' transactions.

Should you have any question in relation to this matter please do no hesitate to contact our Mr Griffin."

4 The matter proceeded on 24 January 2004 and orders were made, inter alia, that Mr Romanos was not liable to Melbourne Estate Agents Pty Ltd for any amount owing pursuant to the exclusive auction authority dated 5 March 2003 for marketing expenses and that Melbourne Estate Agents Pty Ltd pay Mr Romanos the sum of $4,950.00 being losses claimed by him. The applicant's costs were reserved. Senior member J Preuss who dealt with the matter noted on the record of the order the following:

"1. The letter dated 24 January 2005 from Griffin Law Firm to the Tribunal.

2. The letter dated 24 January 2005 from Griffin Law Firm to the applicant's solicitors Paul Violi & Co.

3. That there has been no application for an adjournment of today's hearing by the respondent or its solicitors.

4. There was no attendance today at the Tribunal at the time listed for the hearing of this matter by the respondent or its solicitors.

5. While the letter of 24 January 2005 from Griffin Law Firm to the Tribunal states the respondent was not served with a notice of hearing, the Tribunal file indicates that service was effected on the respondent by Express Post on 11 January 2005 to both the registered office of the respondent and to its business address.

6. By letter dated 24 December 2004, to its business address and its registered office, the Tribunal notified the respondent of the provisions of s 104A of the Fair Trading Act 1999."

5 Melbourne Estate Agents Pty Ltd applied to the Tribunal to have the decision reviewed. The application was supported by a statutory declaration sworn by Jamie Griffin. In respect of the reasons for non-attendance or representation at the original hearing, the statutory declaration stated the following:

"a. The respondent was not served with the application.

b. On 18 January 2005 a Notice to Admit was served on the applicant's solicitor by facsimile and by post.

c. On 19 January 2005 the applicant's solicitor telephoned Griffin Law Firm and left a message with Nicole Smith stating that the matter was being heard in VCAT.

d. On 24 January 2005, Natalie McCabe telephoned the applicant's solicitor, Mr Paul Violi, at 12.15 pm to inquire about the message.

e. The applicant's solicitor advised Ms McCabe that the hearing of his client's application in VCAT was at 2.00 pm that day.

f Ms McCabe advised Mr Violi that neither the respondent nor its solicitor were aware that the proceeding had been transferred to VCAT and could not be present at the hearing at such short notice.

g. At 1.05 pm on 24 January 2005, the Tribunal was advised by facsimile transmission that the respondent could not attend the hearing and that I was unable to obtain instructions from the respondent in relation to the application.

h. The applicant's solicitor was also informed by facsimile transmission that the respondent could not attend at the Tribunal at such short notice.

i. I am informed by Mr Rustu Senol, director of the respondent that the registered office was closed over the Christmas period and did not re-open until Monday 24 January 2005.

j. The Glenroy road address for the respondent was 207 Glenroy Road. This is no longer a place of business of the respondent. Whilst mail from the Glenroy Road address will be re-diverted, based on the conversation with Registrar O'Keefe, the letter from VCAT as addressed to Glenroy Road was incorrectly addressed and therefore would have been delivered to a premises of the other side of the road if such an address exists. The statutory declaration was sworn by Jamie Griffin, the solicitor for Melbourne Estate Agents Pty Ltd."

6 Mr Romanos also filed a statutory declaration attached to which were photographs which Mr Romanos stated he had taken of premises at 207 Glenroy Road which purported to be the premises of Melbourne Estate Agents. He also stated that he had attended the office and obtained a business card of Mr Rustu Senol (referred to in the above statutory declaration filed on behalf of the company) and business cards of one Roy Saker purporting to be a director of Melbourne Estate Agents and the address displayed on the cards was 207 Glenroy Road Glenroy.

The decision of the Tribunal on the review application

7 The application to review the 24 January 2005 decision came before Professor Cremean on 28 February 2005. It was brought pursuant to s 120 of the Victorian Civil and Administrative Tribunal Act 1998. That section is in the following terms:

"120. Re-opening an order on substantive grounds

(1) A person in respect of whom an order is made may apply to the Tribunal for a review of the order if the person did not appear and was not represented at the hearing at which the order was made.

(2) An application under sub-section (1) is to be made in accordance with, and within the time limits specified by, the rules.

(3) The rules may limit the number of times a person may apply under this section in respect of the same matter without obtaining the leave of the Tribunal.

(a) hear and determine the application if it is satisfied that the applicant had a reasonable excuse for not attending or being represented at the hearing; and

(b) if it thinks fit, order that the order be revoked or varied.

(5) Nothing in Division 3 of Part 3 applies to a review under this section."

8 Professor Cremean, in dismissing the application, gave the following reasons:

"I am satisfied in this matter that the requirement of s 120, that is the showing of reasonable excuse for not attending or being represented, has not itself been satisfied. If I assume that it can be said that the applicant for review did not attend and was not represented, there is an open question to my mind whether the (indistinct) party was represented even though not attending.

Nevertheless, it seems to me that there was a hearing (sic) between 10 past 12 and the time of 2 o'clock during which it could be possible for the applicant for the review to be represented at the hearing if that had not already taken place or for attending at the hearing by way of either a person from the solicitor's office at Campbellfield or wherever it is, isn't that far away, or by briefing a member of counsel to attend here.

The other party was able to brief counsel and I do not see any reason why in that short time a member of counsel could not be briefed to appear and to seek an adjournment which in all probability would have been granted. In my view a reasonable excuse for not attending has not been established to the required level of satisfaction. Accordingly, the application for review is dismissed."

"1. Order dated 24 January 2005 shall remain in force.

2. I direct the principal registrar to pay out of trust the sum of $4,099.59 to the applicant (George Romanos) forthwith.

3. I order the respondent to pay the applicant's cost of $660.00. Stay of 30 days."

Grounds of appeal

10 The notice of appeal identifies the following issue of law:

"The ground of appeal, and the error of law, on which the appeal is brought is as follows:

Having regard to the facts that:

(a) orders of the Tribunal made on 24 January 2005 ('the first orders") were made at a hearing conducted in the absence of the plaintiff; and

(b) the plaintiff's excuse for failing to attend the hearing on 24 January 2005 was that the plaintiff was unaware of the hearing and the solicitors for the plaintiff had less than two hours notice of the hearing and could not obtain instructions for the plaintiff or attend the hearing on short notice;

the Tribunal erred at law in finding that the plaintiff did not have a reasonable excuse for not attending the hearing on 24 January 2005 within the meaning of s 120 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic)."

Submission of the appellant

11 Counsel for the appellant submitted that the Tribunal erred because it failed to give sufficient weight to the time frame in which the appellant's solicitors found themselves on 24 January 2005. It was also put that the underlying assumption to the Tribunal's reasons was that the solicitor had implied authority, and an obligation, to either drive from Campbellfield to King Street or brief counsel to appear to seek an adjournment. Counsel questioned whether such authority existed and argued further that it confirmed the insufficiency of the weight given to the time frame that existed.

12 On the question of whether the solicitor had authority, the law appears to be that the solicitor has authority to act within the area of express or implied authority and that a general retainer will authorise such matters as flow from the retainer. As to expenses, a solicitor is not entitled to incur any unusual expense without the consent of the client and if the solicitor does the expense will be disallowed on taxation of costs.[1] The research of counsel, and my research, has not revealed any cases directly in point. It is difficult to conceive, however, that a solicitor would not have had authority to engage counsel to salvage the situation for the client. Applying general agency principles the solicitor would have had authority incidental to its retainer to do whatever was necessary or normally incidental to the activity expressly authorised.[2] The solicitor, having authority to represent the company in the dispute in question, he would have had authority to take whatever procedural steps were necessary to protect the position of the client, including the incurring of any reasonable costs.

13 Counsel submitted that the reasons advanced provided a reasonable excuse for the non attendance and non representation. Alternatively, he submitted that to the extent that the failures of the solicitor were being visited upon Melbourne Estate Agent Pty Ltd, the general rule was that the failures of the solicitor should not carry adverse consequences for the client in this sort of situation and one should excuse it because it had no knowledge of the proceeding. Counsel referred to Collins Book Depot Pty Ltd v Bretherton[3] and White v Dortenzio.[4] Counsel also relied upon the consideration of s 120 by Bongiorno J in Alesci v Salsbury.[5] Counsel referred to his Honour's statement that:

"4. Section 120 of the Victorian Civil and Administrative Tribunal Act 1998 provides a mechanism for the reconsideration of a decision made in the absence of a party. It concentrates on the actions of the person affected by the order made in his or her absence.

. . .

6. Section 120 is a section which is to be construed liberally. It would be difficult, I think, to put forward a case where a blameless non attending defendant would not be entitled to a review of the order made in his or her absence. As I have said, Ms Burden Smith (the Tribunal member) in her findings of fact, exonerated the plaintiff. To then proceed to say that the entrusting of his legal representative with the conduct of the matter did not constitute a reasonable excuse, in my opinion was not sustainable. Saying that a conclusion is not sustainable is equivalent to saying that it was a finding or a conclusion which was not open to her to make. That such constitutes an error of law is beyond argument."

Analysis

14 Section 120 is worded somewhat ambiguously. It is not entirely clear whether the Tribunal may not hear an application unless it is satisfied that the applicant had a reasonable excuse for not attending or being represented or whether that requirement is simply a specific requirement that must be satisfied under the legislation before an order can be made revoking or varying the original order. Ultimately, it probably does not matter. What is critical is that the legislation requires that, before an order may be revoked or varied, the Tribunal be satisfied that the applicant had a reasonable excuse for not attending or being represented at the hearing.

15 The difficulty for the appellant in this case is that in challenging the finding on that issue, it must establish an error of law and to do that it must demonstrate that the conclusion reached by the Tribunal was not reasonably open to it on the evidence.

16 The case put below was in essence that Melbourne Estate Agents Pty Ltd was not aware of the application and that when its solicitors became aware of it the time frame was such that it could not be reasonably expected to attend or represent the company at the hearing.

17 In the course of discussion, Professor Cremean made it clear that he saw the critical period for which a reasonable excuse had to be found as being the period between 12.10 and 2.00 o'clock. He did not specifically address the question whether the company was aware of the application but appeared to proceed on the basis that he would assume that issue in favour of the company. This course was open because the company was accepting that the acts of the solicitors were its acts. There was, however, no finding made on the question of the company's awareness.

18 The reasons of the Tribunal focus on that period of approximately two hours and focus on the question of whether it would have been possible for the solicitors to attend or to brief counsel to attend. In the end it would appear the Tribunal took the view that the latter option was an obvious one and no reasonable excuse had been offered for that option not being taken. In fact, the company gave no explanation for not briefing counsel to appear. The Tribunal then concluded

"in my view a reasonable excuse for not attending has not been established to the required level of satisfaction".

19 On the basis of the evidence before the Tribunal, while another person may have come to a different conclusion, it cannot be said that the decision reached was not reasonably open.

20 As a further issue, counsel for the appellant, relying upon the authority mentioned above, argued that the failings of the solicitor should not be held against the client and that even if the view was formed that the conduct of the solicitor was not reasonable, the question ultimately was whether the failure of the client to attend one way or another could be reasonably excused and that in view of the non-service of the application on the company and its reasonable reliance on its solicitors to do all things necessary to protect its interests, it had established a reasonable excuse. This argument involves a change of position from that taken at the original hearing..

21 The appropriate approach to be taken on appeals in that situation has been discussed many times in the authorities. A recent statement of relevant principle is found in the case of Whisprun Pty Ltd v Dixon[6]:

'It would be inimical to the due administration of justice if, on appeal, a party could raise a point that was not taken at the trial unless it could not possibly have been met by further evidence at the trial. Nothing is more likely to give rise to a sense of injustice in a litigant than to have a verdict taken away on a point that was not taken at the trial and could or might possibly have been met by rebutting evidence or cross-examination even when no question of further evidence is admissible, it may not be in the interests of justice to allow a new point to be raised on appeal, particularly if it will require a further trial of the action. Not only is the successful party put to expense that may not be recoverable on a party and party taxation but a new trial inevitably afflicts on the parties worry, inconvenience and interference with their personal and business affairs."

In the present appeal, the matter sought to be raised was not raised below and it cannot be demonstrated that it could not have been met by further evidence below.[7] Thus this alternative argument while involving a question of law is not one that can be canvassed on this appeal.

Conclusion

22 For these reasons, the appellant has failed to demonstrate that any error of law was made. The appeal should be dismissed.

[1] Cordery on Solicitors 9th Edition, F2 - F3.

[2] Bowstead & Reynolds on Agency 17th Edition 3 - 003 and Article 27, 3 - 018.

[3] [1938] VicLawRp 11; [1938] VLR 40.

[4] [2004] VSC 381 per Kellam J.

[5] [2002] VSC 475.

[6] [2003] HCA 48; [2003] 200 ALR 447 at [51].

[7] E.g. evidence concerning whether the documents mailed by the Tribunal giving notice of the application were appropriately addressed, whether they were returned to the Tribunal and whether at the relevant time the company was carrying on its business at 207 Glenroy Road.