Plaintiff v Defendant

Plaintiff v Defendant - [2006] VSC 170 - VSC 2006 case summary — Zoe

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1 By notice of appeal dated 6 April 2006 the plaintiff appealed to a judge against the decision of the Senior Master made on 30 March 2006 to dismiss its application that this proceeding be reinstated. The appeal was heard by me in the Practice Court. The appeal raised an important issue of practice and procedure. Accordingly, I reserved my decision.

FACTS

2 The proceeding was commenced on 14 January 2000. The plaintiff makes allegations concerning the conduct of the defendant in and between 1990 and 1994. There have been a number of versions of the statement of claim. Some of the issues which were initially raised have been the subject of summary judgment against the plaintiff, and other allegations have been struck out. There is no doubt that there has been inordinate delay by the plaintiff in the prosecution of the proceeding.

3 On 27 February 2002, Master Kings ordered pursuant to Rule 63.03(3)(a)[1] that the proceeding be stayed until such time as the plaintiff paid the sum of $25,723.40 ("the stay amount") to the defendant. This amount was due in respect of unsatisfied costs orders made by the Court on previous applications. Further, Master Kings ordered that certain paragraphs of the then current statement of claim be struck out and that the plaintiff have leave to file and serve an amended statement of claim within 14 days of payment of the stay amount.

4 The plaintiff did not pay the stay amount. Accordingly, the proceeding remained stayed for over a year.

5 Following correspondence from the Prothonotary's office to the solicitors for the plaintiff in 2003, Bongiorno J ordered on 22 August 2003, on the Court's own motion, that the proceeding be dismissed "with a right of reinstatement".

6 In about April 2004, Mr Leslie Thomas, who is the sole director and shareholder of the plaintiff, met and persuaded a solicitor to act for the plaintiff. Soon after, on 14 May 2004, Thomas (with the assistance of his daughter) borrowed the stay sum and procured the drawing of a bank cheque for that amount in favour of the defendant's solicitors, Mallesons Stephen Jaques. For reasons which are not explained in the evidence, this bank cheque was never tendered to the defendant or its solicitors and became stale.

7 By summons dated 22 August 2005, the plaintiff made its first application to have the proceeding reinstated ("the first reinstatement application"). The first reinstatement application was heard and determined by Master Efthim on 3 October 2005.

8 The plaintiff relied upon two affidavits sworn by Thomas. These affidavits deal with the underlying events about which the plaintiff complains in the proceeding, and with the procedural history of the proceeding. Further, Thomas deposes to his own limited financial means and the fact that he required the assistance of his daughter to borrow money enabling him to procure the bank cheque for the stay amount in May 2004. As I have said, there is no explanation as to why the bank cheque was not tendered to the defendant or its solicitors.

9 Master Efthim also considered a detailed written outline of argument on behalf of the defendant dated 30 September 2005. This written outline discloses that the first reinstatement application was opposed on a variety of grounds, including submissions that:

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21 The Senior Master held that the "new material" relied upon by the plaintiff, being the payment of the stay amount and the production of a proposed further amended statement of claim, did not satisfy the test of "new evidence" required by the decisions in Guss and Stragan. Accordingly, he dismissed the second reinstatement application as an abuse of process, without considering the merits of the application.

22 As I have said, by notice of appeal dated 6 April 2006, the plaintiff appeals against the decision of the Senior Master.

23 On the hearing of the appeal, I was asked to proceed in the same way as the Senior Master proceeded, and hear and determine the oral application by the defendant to dismiss the second reinstatement application as an abuse of process. Although the hearing of an appeal from a Master is a rehearing de novo, I accepted the submission of both parties that I should proceed in this way. Having considered the written outlines of argument filed on behalf of the parties, it seemed to me that, if the defendant's submissions concerning the applicable law were correct, this would avoid the necessity for the Court to consider the merits of the second reinstatement application and the substantial affidavit material filed in respect of it.

APPLICABLE LAW

24 On behalf of the defendant, it was submitted that I was bound to find that the second reinstatement application was an abuse of process because it was not based upon "new evidence" which was not available at the time of the hearing of the first reinstatement application. Reliance was placed upon the Court of Appeal decision in DA Christie Pty Ltd v Baker[7] and on the application of the principles discussed in Christie by Batt J in Guss and Beach J in Stragan.

25 In Christie, the Court of Appeal considered an appeal from a decision of a County Court judge to allow a second application for an extension of time within which to bring an action under s. 23A of the Limitation of Actions Act 1958 (Vic). An initial application for extension of time had been dismissed by a different County Court judge on the grounds that there was no explanation for the delay. The second application was supported by material explaining the delay. The appeal was allowed by majority, Brooking and Hayne JJA, (Charles JA dissenting).

26 Brooking JA decided the appeal on the basis that the second application was caught by the principle of issue estoppel.[8]

27 Brooking JA continued:

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37 In National Parks and Wildlife Service v Pierson[21] the Court of Appeal in New South Wales considered a second application to reinstate a proceeding which had been struck out for default in compliance with the Court's directions. Palmer AJA, with whom Mason P and Santow JA agreed, considered that if an application for reinstatement was made before the default had been cured, and was dismissed for this reason, there was no bar to a second application after the default had been cured. This was because "there will have been a change in the circumstance which led to the refusal of the first application."[22] Further, Palmer AJA considered that it was not impossible for a second application for reinstatement to succeed, even if the default has not been cured prior to the making of the application, "because the overriding principle governing the approach of the court to interlocutory applications is that the court should do whatever the interests of justice require in the particular circumstances of the case."[23]

38 In Philip Morris Ltd v Attorney General for the State of Victoria & Lindsey[24] the Court of Appeal considered a ninth application by a vexatious litigant for leave to commence proceedings. Maxwell P was of the view that it was not open to Philip Morris to argue that the application itself was an abuse of process.[25] However, as the matter had been fully argued, Maxwell P considered whether the application was itself an abuse of process. In doing so, Maxwell P considered Christie, Manning and Pierson.[26] Although Maxwell P did not state expressly that he disagreed with the majority in Christie, a full reading of his Honour's judgment indicates a preference for the approach by the New South Wales Court of Appeal in Manning and Pierson, and the dissenting judgment of Charles JA in Christie. However, Maxwell P confined himself to distinguishing Christie on the basis that it was a different kind of application and did not involve "judge shopping."[27]

39 Ormiston JA was not convinced that Philip Morris could not argue that the application was itself an abuse of process.[28] As to whether Christie should be applied to interlocutory applications generally, and not just applications to extend time to commence proceedings, Ormiston JA stated:

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40 Eames JA agreed with Ormiston JA that Philip Morris was not prevented from arguing that the application was itself an abuse of process. Whilst agreeing with the reasons of Maxwell P as to why the application in that case did not constitute an abuse of process, Eames JA stated that he did not consider Maxwell P to have cast doubt on the statements of principle made in Christie. With respect, as I have said, my view of the judgment of Maxwell P is that it indicates, without deciding, a clear preference for the approach of the New South Wales Court of Appeal over that expressed in Christie.

41 My review of the authorities has led me to the conclusion that I am not bound, in considering the second reinstatement application in this case, to apply Guss and Stragan, with the effect that I am limited to considering any "new evidence" which was not available on the hearing of the first reinstatement application. I am of this view for the following reasons.

42 In the first place, although the second reinstatement application is of a similar kind to an application to set aside a default judgment, it is a different application.

43 Secondly, the decision of Mandie J in Global Realty constitutes a single judge decision which is contrary to the decisions in Guss and Stragan. In these circumstances, the weight to be attached to the fact that the decisions in Guss and Stragan concern matters of practice and procedure is diminished.

44 Thirdly, and most importantly, both Brooking and Hayne JJA in Christie clearly stated that they were not purporting to lay down any general rules to be applied in determining whether any interlocutory application constitutes an abuse of process.

45 Fourthly, the variety of interlocutory applications and of the circumstances pertaining to each individual application dictate, in my view, that it is undesirable that there be a set of rigid rules to be applied to every case where a second interlocutory application is made after the refusal of a first application for the same relief. In this regard, I respectfully adopt the passage from the judgment of Heydon JA in Manning quoted above[30] which was referred to with apparent approval by Maxwell P in Philip Morris.[31]

46 As a result, it is my view that the correct approach to apply to second or subsequent interlocutory applications is that stated in Manning and Pierson that "the overriding principle governing the approach of the court to interlocutory applications is that the court should do whatever the interests of justice require in the particular circumstances of the case."[32] As I have said, this statement was referred to with apparent approval by Maxwell P in Philip Morris.[33] Further, this approach is consistent with the statement of Brooking JA in Christie quoted above in respect of interlocutory applications concerning questions of practice and procedure that:

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