Plaintiff v Defendant

Plaintiff v Defendant - [2017] VSC 487 - VSC 2017 case summary — Zoe

[69]

MR McKENZIE: Yes, sir. The situation is that I have had an opportunity to have a discussion with my client. I did say that the tribunal would be minded to be concerned about the way in which this particular respondent has conducted themselves but they had had opportunities and time in circumstances. My instructor tells me that some document was filed yesterday with the registry. We haven't been served with anything.

MR DAVIS: Well, I don't think I know about that document. I don't think it's on the file, that I'm aware. There certainly is a defence, but that - there's an amended points of claim but that's last August. So I don't think that's the one we're talking about. And I don't know - - -

MR McKENZIE: No. We haven't amended our points of claim, sir. We

only - - -

MR DAVIS: No, no, sorry. Amended defence and setoff was filed, but that was last August, and I note that in - - -

MR McKENZIE: We haven't - it must be in the wrong proceeding or wrong heading, sir.

MR DAVIS: Well, there could be all sorts of things but because there was all sorts - I've been to Shepparton and there were all sorts of files on my desk - and some of them seemed to have nothing to do with me - this morning.

MR McKENZIE: Right.

MR DAVIS: And I was having - but it was only on 24 January, which was yesterday, that Senior Member Riegler made the order but, more importantly, it was only on 19 January, which was last week, that - - -

MR McKENZIE: Deputy President - - -

MR DAVIS: - - - made the order, listed for one day commencing - but it looked to me like more than a one-day matter, having quickly looked at it, but you might know more about it than me, but it looked a lot more than one day.

MR McKENZIE: It depended what the defence was, and if there was one.

MR DAVIS: I mean, if it was a highly fought matter, I don't think we would do this in a day, but - - -

MR McKENZIE: To the extent that - we either served the notice or we didn't, and we therefore have the - have taken up the option or we haven't, we say it's a fairly simple matter from our point of view.

[76]

Yesterday afternoon the respondent requested an adjournment because, apparently, its legal representatives were in Brisbane. Senior Member Riegler told the registry to communicate with the respondent's solicitor, informing him that there would be no adjournment, and he could remake an application before me today. The respondent has not shown before me today. I decided that the matter should proceed to hearing undefended, as the respondent was not here and orders have not been complied with. I have since heard evidence from Mr O'Halloran's solicitor for the applicant.

He has informed me that a notice of renewal of option was sent, which appears to renew the option that the applicant is seeking in terms of a declaration that is sought. That is a declaration by letter dated 27 May 2016 referred to in paragraph ten of the applicant's exercise of option for a further term commencing dated 2 December 2016. Further, it is clear on the material which I have read that the applicant is seeking specific performance of an agreement of a lease, including an order that the respondent prepare, execute and provide to the applicant a lease concerning the premises for a period of two years for a period of 2 September 2016 to 1 September 2021, on the terms of the lease as viewed by the renewal lease and containing six options for further terms for five years.

Thus, I am satisfied that the applicant has made out its case. I am satisfied that the applicant has been caused a disadvantage in this matter pursuant to s 78(1)(g) of the Victorian Civil and Administrative Tribunal Act. That disadvantage has been caused by the respondent failing to attend the hearing this day, as well as a disadvantage in failing to comply with orders of this tribunal. As a result, I intend to make the orders sought by the applicant. And I will make an order for the hearing fee, as I am allowed to do. And I believe that there has been a degree of vexatiousness in this matter. And I think that, as a result of that, insofar as the hearing fee is concerned, section 92 of the Retail Leases Act 2003 is complied with in the sense that the applicant is entitled to that fee. And I will make those orders accordingly.

[78]

MR McKENZIE: Yes, sir. There's only one aspect that I might raise with the tribunal, which - - -

MR DAVIS: Yes.

MR McKENZIE: I'm looking at the order that was made by Senior Member Riegler on 24 January.

MR DAVIS: When was this order made?

MR McKENZIE: It was 24 January, yesterday's order by - - -

MR DAVIS: Yes.

MR McKENZIE: - - - the Senior Member, and it said:

The plaintiff's application to the ..... shall be heard before the presiding member.

Now, I don't think we got a formal order to say that the plaintiff - sorry, the respondent's application - that the respondent has not appeared, and therefore no application has been - - -

MR DAVIS: Well, I think I've said the fail to appear. I didn't - that's order 1.

MR McKENZIE: Yes.

MR DAVIS: ..... now, it does mention about by telephone, but I don't think there was any telephone number given, and it was never asked. I perhaps should note - I will put a note on the order.

MR McKENZIE: So I would just like to tell you that in case they come back and no longer - - -

MR DAVIS: Yes. Noted that while, pursuant to order 2 of the orders of 24 - it is noted that while, pursuant to order 2 of the orders of 24 January 2017, the applicant was given leave to appear by telephone on this day, no application to appear by telephone was made, and no details were provided.

MR McKENZIE: I'm troubled, sir, with the difficulty we've had with these people. The letter from Case Legal, 24 January, does identify a responsible person and a telephone number.

MR DAVIS: Well, do you think we should have rung them?

MR McKENZIE: I don't think it was required that we ring them, but - - -

MR DAVIS: Well, that's the normal way it happens.

MR McKENZIE: But when they say they're given leave to appear by telephone at the return of its application to vacate the hearing, in effect, we called them, they made no telephone call and no number was given.

MR DAVIS: Well, that's why I'm saying no details were provided.

MR McKENZIE: Well, I was troubled by that, bearing in mind that they wrote on the 24th - they actually said they won't be here, and they don't intend to be available to deal with it, but that's all they say.

MR DAVIS: Well, do you want me to say that specifically? Well, I think that I said there was no application to appear by telephone, no details were provided. Do you want me to cross out the words "no details provided"?

MR McKENZIE: I'm not - I was concerned .....

MR DAVIS: All right. I will cross those words out.

MR McKENZIE: ..... cause me some difficulty because - - -

MR DAVIS: I think - - -

MR McKENZIE: Yes, thank you, sir.

MR DAVIS: All right. And if it comes to the point where you argue it, well, that's something you can - - -

MR McKENZIE: Have to deal with.

MR DAVIS: I'm sure you will attend with that.

MR McKENZIE: Yes, sir.

MR DAVIS: I mean, we all know, as I've said, when you start taking bets on what's likely to happen.

MR McKENZIE: Exactly.

MR DAVIS: All right. Well, if that's satisfactory, I will - - -

MR McKENZIE: Thank you, sir.

MR DAVIS: I will make those orders.

[102]

I agree, and I would add only the following additional remarks of my own.
It appears not to be widely appreciated that the rules of natural justice apply with as much rigour to decisions of courts of law as they do to administrative decisions. This is the second time in a week when I have had to deal with an issue where solicitors refused to agree to a reasonable request for adjournment. It is axiomatic that a party required to respond to a proceeding, an application, a summons, is entitled to reasonable notice of that application and a reasonable opportunity to prepare his or her case in answer to it. That is a bedrock principle of justice and it is vitally important that every practitioner be aware of it.
Leaving aside for the moment the inconvenience and cost which the respondent's refusal of the adjournment has occasioned, the refusal of the adjournment appears to me to betray a failure to appreciate that fundamental principle. The solicitors for the respondent were informed, by a person whose credibility they had no reason to doubt, that he had just received the papers for an application to be heard the following day. He requested an adjournment for 14 days and it was refused.
The reasons given in the affidavit of the solicitor in question are consistent with the mistaken position which the respondent has adopted throughout in relation to the question of adjournment. That is, the respondent has mistakenly treated its quite legitimate complaints about what is said to be Mr Hallett's non-compliance with procedural rules of the County Court as somehow affecting his bedrock entitlement to natural justice. Mr Hallett may well have been egregiously in default of County Court orders. He may have gone overseas in a way which would be capable of being characterised as showing indifference to the proceeding that he was supposedly conducting. But these mat__ters were nothing to the point. No prior default on his part could in any way have disentitled him to procedural fairness in relation to the application to dismiss.
It is a matter of real concern that this principle appears not to have been appreciated even as late as today. The respondent still maintains in this Court that to have allowed Mr Hallett an adjournment would have enabled him 'to achieve by stealth' an extension of time with respect to the pleadings. That submission confuses two quite different concepts. What the applicant wanted, and what he was entitled to, was reasonable time to prepare to meet a very serious application - of which his solicitor had just received notice - to dismiss his proceeding. That had nothing to do with getting more time to file a pleading. The time was required to enable him to deal with an attack based on his non-compliance, which may turn out to have been wholly justified. It is no more relevant to say in opposition to this application for leave to appeal that there had been default than it was relevant to say that in opposition to the adjournment application at the time. Nor, I would add, is it in any way relevant to raise on this application an argument that there were costs orders unpaid and that this was another reason why the County Court judge should have dismissed the proceeding. To repeat, the plaintiff's application for adjournment did not raise the question of the merits of the application to dismiss the proceeding. The only issue was whether the applicant required time in order to exercise his right at law to respond to the application.
For the reasons given by Eames JA, it is clear that the plaintiff was not given that opportunity and that there was a breach of natural justice. The decision dismissing his proceeding must therefore be set aside because it was arrived at in breach of natural justice.
... [T]here will be no grant of a certificate. The costs of the appeal have been entirely occasioned by the respondent's conduct of the adjournment application and of this appeal. For the reasons I have given, the respondent has mistaken the nature of the adjournment application and the appeal and the principles in issue.

[107]

The tribunal is bound by the rules of natural justice and bound as part of the requirement to afford natural justice to afford each party a reasonable opportunity to present his or her case. Failure to do so is an error of law and possibly also jurisdictional error. But it is not every breach of the rules of natural justice that will render a decision invalid. The court may refuse relief if satisfied that what appears on face to have been a denial of natural justice could have had no bearing on the outcome.
As has already been recorded, Mr Easy made a suggestion late in the hearing that he be given an adjournment to obtain further evidence about the nature of the secondment arrangements. The appellant now contends that Mr Easy's suggestion constituted a request for an adjournment and that the member's response, that he was loathe to grant further time, was tantamount to a refusal. Thus it is said that the appellant was denied an opportunity properly to present its case.
The respondent submits that there are two answers to the appellant's contention. The first is that the appellant should have anticipated that the secondment arrangements were likely to be a significant issue in the case and had plenty of opportunity in advance of the hearing to prepare its evidence accordingly, and hence that the appellant was given a proper opportunity to present its case. ...
I do not think the respondent's first answer to be very persuasive. It is not to the point that the appellant might have anticipated the need for evidence on the secondment arrangements. Applications for adjournments are not to be decided on the basis of whether a party could have anticipated the requirement which gives rise to a need for adjournment. It is not an occasion for punishment of a party for its mistake or for its delay in making its application. The paramount consideration is to do justice and thus to enable the parties to present their case as fully as necessary within the limits of the law. Delay of itself is rarely a basis for refusal.
Here it became apparent in the course of the hearing that the member regarded the nature and terms of the secondment arrangements as a significant issue. As was later to emerge from the member's written reasons for decision, the member also thought to be significant the fact that the appellant did not provide any documentary evidence of the arrangements. In those circumstances, the refusal of an adjournment to allow the appellant to adduce written evidence was likely to create an appreciable risk of injustice. Yet the only apparent reason for the member's reticence to allow more time was the minor inconvenience of delay.
It goes without saying that any decision to allow or to refuse an adjournment was a matter in the member's discretion and that it was the sort of exercise of discretion with which an appellate court is hesitant to interfere. But an appellate court will interfere if satisfied that the discretion has been exercised in such a way as to result in an injustice to one of the parties. In this case I think that it was.

[117]

In my opinion, bearing in mind the submissions of counsel directed to the provision here under scrutiny, the subject matter, scope and purpose of the Act show that if the tribunal forms a belief concerning the matters required by s 78(1)(a) of the Act the following matters must be considered in the exercise of the discretion under subs (2):
- The subject matter of the belief formed by the tribunal for the purposes of subs (1).
- The nature of the power conferred by subs (2) in the context of the armoury of power conferred upon the tribunal by ss 75-77. By this I mean, particularly, that s 78(2) operates in circumstances which at least do not require that the proceeding be frivolous, vexatious, misconceived, lacking in substance or otherwise an abuse of process; and which at least do not require that the circumstances demonstrate want of prosecution. Put another way, the subsection contemplates the making of an order with very serious consequences in circumstances that very probably would not fit the templates set up by ss 75 and 76. Whilst it can rightly be said that the creation of such a remedy in the situation contemplated by s 78(1) shows that an intention that orders be made in some cases where the situation exists, it should also be firmly concluded, in statutory context, that the remedy should be of last resort and not first resort.
- The requirement imposed upon the tribunal by s 97. That section should be considered to import the concept that, ordinarily, the interests of case management should not be employed so as to shut a party out of litigating its case. The ultimate aim of the tribunal, as much as of a court, must be the attainment of justice in respect of issues joined.
- The requirement imposed by s 98(1)(a), to the extent that a party should ordinarily be given an opportunity to be heard upon the merits. That opportunity is not absolute. It may be lost without breach of the rules of natural justice. But the consequence that the making of an order under s 78(2) will deprive a party of an opportunity to be heard upon the merits is surely relevant to exercise of the discretion whether to so order.
- The power to make costs orders conferred by ss 109(2)(3) and 78(2)(c). The last-mentioned, it appears, might be exercised even though no order is made under s 78(2)(a) or (b).
It may be that in a particular case the tribunal will consider some other matter to be relevant. It does not follow from the fact that only some matters must be considered that other matters are necessarily irrelevant. Other matters will only be irrelevant if they infringe an implied limitation on the factors to which regard may legitimately be held. Any such limitation must be found in the subject matter, scope and purpose of the statute.

[136]

Rule 21(2)(b) indicates that the rules concerning civil litigation no longer are to be considered as directed only to the resolution of the dispute between the parties to a proceeding. The achievement of a just but timely and cost-effective resolution of a dispute has an effect upon the court and upon other litigants. In Sali v SPC Ltd Toohey and Gaudron JJ explained that case management reflected:[60] "[t]he view that the conduct of litigation is not merely a matter for the parties but is also one for the court and the need to avoid disruptions in the court's lists with consequent inconvenience to the court and prejudice to the interests of other litigants waiting to be heard ..."
It will be recalled that in J L Holdings the plurality said that nothing in Sali v SPC suggested that principles of case management might be employed "except perhaps in extreme circumstances, to shut a party out from litigating an issue which is fairly arguable".[61] Their Honours said that case management was not to be seen as an end to itself and that the ultimate aim of the court remained the attainment of justice, even in changing times.[62] In Gale v Superdrug Stores Plc[63] Millett LJ expressed a similar concern, regarding the need to ensure that justice is not sacrificed. Waller LJ, delivering the judgment of the Court of Appeal in Worldwide Corporation Ltd v GPT Ltd,[64] said that such a concern did not pay sufficient regard to the fact that the courts are concerned to do justice to all litigants. Where a party had had a sufficient opportunity to plead his or her case, it may be necessary for the court to make a decision which may produce a sense of injustice in that party, for the sake of doing justice to the opponent and to other litigants.[65]
The statement of Waller LJ identifies a fundamental premise of case management. What may be just, when amendment is sought, requires account to be taken of other litigants, not just the parties to the proceedings in question. The statement is consistent with what was said in Sali v SPC, which reflected a proper understanding of case management. The statements in J L Holdings do not reflect such an understanding and are not consistent with what was said in Sali v SPC. To say that case management principles should only be applied "in extreme circumstances" to refuse an amendment implies that considerations such as delay and costs can never be as important as the raising of an arguable case; and it denies the wider effects of delay upon others.

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