RAZVAN v BERECHET

Court of Appeal (NSW)|1989-11-22|Before: Hunt J, Kirby P, David Hunt J, Dr P

KIRBY P, SAMUELS and MEAGHER JJA 22 November 1989, 23 February 1990

APPEAL - practice decision - order dismissing proceedings for want of prosecution - stringent conditions for - need to show that default has been intentional and contumelious or that there has been inordinate and excusable delay and that such delay will give rise to a substantial risk that a fair trial may not be had. Birkett v James [1978] AC 297, 318 (HL) and Department of Transport v Chris Smaller (Transport) Ltd [1989] 2 WLR 578, 581 (HL) referred to; Stollznow v Calvert [1980] 2 NSWLR 749, 751 applied. Alexander vy Cambridge Credit Corporation Ltd (Receivers Appointed) (No 3), Court of Appeal, unreported, 30 May 1986; (1986) NSWJB 103 referred to and explained. JUDGMENTS AND ORDERS

dismissal of proceedings for want of prosecution - Defamation List - application made in April 1987 to dismiss proceedings commenced in 1983 in respect of publication in 1981 - failure of plaintiff to set down for trial - trial judge (David Hunt J) in March 1987 orders plaintiff to pay defendant's costs and warns against "unexplained or unacceptable delay" - declines to dismiss proceedings - in August 1987 following further delay dismisses the proceedings - explanations for delay proffered by appellant and, in part, accepted by Hunt J - whether discretion to dismiss proceedings miscarried in the circumstances - held: It did because (per Kirby P) (a) there was no evidence that further delay was deliberate; (b) there was no evidence of specific prejudice to the respondent; (c) the additional delay was not inordinate and acceptable excuses had been given for it; (d) there was no additional substantial risk that a fair trial might not be had by reason of what had occurred between April and August 1987; (e) there was no evidence that his Honour had weighed, in reaching his decision, the right of the plaintiff to have a trial of his action, which appeared otherwise arguable on the merits; and (f) the relief of dismissal is conserved to clear cases, of which this was not one; (per Samuels and Meagher JJA) The trial judge had exercised his discretion by reference to the failure of the plaintiff to comply with directions given; but there was no such clear direction, default in compliance with which justified the order made. Supreme Court Rules, Pt33 r6.

Kirby P On 28 August 1987 David Hunt J dismissed the appellant's claim againstthe respondent on the basis of the failure of the appellant to prosecute his claim. He ordered the appellant to pay the respondent's costs of the application and of the action. The appellant appeals to this Court.

Alleged defamation in a Romanian journal The action so dismissed was one brought by the appellant on a statement of claim framed in defamation. The principal matter complained of was the publication, in a Romanian language periodical known as BIRE, of an article alleged to have been written and published by the respondent concerning the appellant. The journal is alleged to be published in France. However, it is distributed to Romanian-speaking people throughout the world, including in Australia.

To the statement of claim is annexed, in a schedule, both the original and a translation of an item attributed to the respondent titled "Correspondence from Sydney: The Missionary Church in Australia Searches for 'Solutions"'. According to the schedule containing a transaction in the English language, the following was what was written:

"The Romanian Communist Government uses three categories of people to divide the ethnic community throughout the world:

The first category is that of the missionary priests in whose Churches the people come and pray to God. But Judas witnesses for them. The second category, and as dangerous as the first, are the Doctors to whom the people go not knowing the language of the new country.

And finally, the third category is the one of the hairdressers.

About the first category I wrote several times and apparently I have aroused the interests of a great number of political refugees. I pause at the second category, the one of the Doctors, and refer to the special case of Dr P Razvan from Ashfield, Australia.

On the Ist February, 1981 the missionary priest Gabriel Popescu announced in "Tribuna Romaniei" that on the Ist November "The Cultural Society George Enescu" was formed at the missionary church "St. Mary's" at Sydney under the leadership of Dr P Razvan. At the same time, on the steps of the Royal Post Office in Sydney, four Romanians were on a hunger strike to be reunited with their families, Micula Rusalim, Marian Torgu, Ion Pantea, Archetraritei Mircea. The orthodox priest didn't visit them during their 13 days of suffering because such a visit was not in accordance with his mission. At the same time the Romanian Diplomat Tunsanu was in Sydney trying to stop the publicity coverage in the newspapers, radio and television. Dr P Razvan in his capacity as a Doctor refused to examine the four suffering Romanians when requested by the Australian Romanian Association.

Dr Petre Razvan is very interested in the missionary church in Sydney, being one of the most generous donors, $600 and candles, such donations being mentioned in the so called newspaper "Altural Strapun".

While on a visit to Dr Razvan's surgery with my wife, he told us bluntly that he was not interested in any association or organisation, but only in the Church and demanded no more and no less, "that the members of the association go to Church, increase the membership and thereby the coffers of the missionary church. For the Australian Romanian Association the case of the missionary church and her cultural society does not come as any surprise. All of them are tarred with the same brush.

One question remains to be asked and I suggest that you consider it carefully. Dr P Razvan relinquished his Romanian citizenship, lived in Israel, and after this took up Australian citizenship. The question is what is Dr P Razvan doing in this Church and her cultural society?

In order to better inform public opinion it is necessary to know the future programme of "St. Mary's Church", published in "Altarul Strabun" in May to August 1981: we seek to establish a weekly broadcast and to publish a guide of the orthodox churches, mentioning all their units for ease of identification, and to avoid any confusion with dissident groups. Now understand what Dr P Razvan meant when he said that the association would not make any progress as long as the church still exists. It is well we know, at least, their programme and the ones who apply it."

On 17 July 1982, the appellant filed a statement of claim. In relation to the above-stated matter, he pleaded the following imputations:

"(a) The plaintiff, despite his duties and responsibilities as a medical practitioner, unjustifiably refused a request to attend to four suffering men.

(b) The plaintiff refused to attend to the said men because their political philosophy was at odds with his own.

(d) The plaintiff is working as an agent of the Communist government of Romania, and exploits his positions of special privilege as a medical practitioner, head of a Romanian cultural society, and within the Romanian Orthodox Church, to take advantage of members of the Romanian community in Australia.

(e) The plaintiff has betrayed his Australian citizenship."

It is further alleged in the statement of claim that, in response to a letter to the same publication written by the appellant and annexed to his statement of claim, the respondent wrote and published in the Romanian language a further letter. This too is annexed and translated. I will refrain from setting it out. Suffice it to say that it is alleged that not only did this second letter affirm that the appellant was guilty of the allegations made in the earlier publication. It also contained the imputation that the plaintiff was actively opposed to Romanian anti-Communists and was a pro-Communist supporter of the then Romanian government. Needless to say, both of the publications giving rise to the action occurred long before the political developments in Romania which have attracted so much attention in recent days. It would be open to argument that the letters would be read, in Australia and elsewhere, against the background of the then prevailing, and presumably strong, feelings in ex-patriot communities of Romanians concerning the activities of the then Communist government of Romania.

The respondent by his then solicitor, Mr Salier, filed a defence on 2 December 1982. A reply was filed which, in its final form, bore the date 8 April 1983. Accordingly, by at least that time, the pleading was concluded. The matter was ready to be set down for trial.

No step having been taken for that purpose, the respondent moved the Supreme Court for an order dismissing the proceedings for want of prosecution. That motion came before David Hunt J on 27 March 1987.

Just before the hearing of the motion, Mr Salier filed, but did not serve, a notice that he was ceasing to act as solicitor for the respondent. On the return of the motion, the respondent appeared in person. He argued the matter himself. As appears from the reasons for judgment of Hunt J, the respondent asserted that he had earlier threatened to take proceedings of this kind in 1985. The appellant swore an affidavit that he was unaware of that threat. Without resolving that difference, Hunt J pointed out that, as a matter of fact, the appellant, whether threatened or not, had done nothing to advance his claim since 1983. As his Honour stated, the jury would be instructed (as commonsense suggests) that this inactivity was open to the interpretation that the appellant did not take the injury to his reputation, for which he sued, very seriously and was not greatly, or at all, aggrieved by it.

The respondent also contended that a nervous condition from which he suffered had been aggravated by the delay. His Honour found that such nervous condition as existed, apart from natural anxiety, had not been proved to have been aggravated by the delay in the legal proceedings. No other evidence of particular prejudice was relied upon.

Hunt J then referred to two considerations which obviously affected his approach to the exercise of his discretion at the March hearing. The first was the applicable limitation period:

"1 am nevertheless faced with the situation that, if I dismiss these proceedings for want of prosecution, the plaintiff would be in a position to start fresh proceedings within the relevant limitation period. What we are arguing about then is really the costs incurred by the defendants in these proceedings..."

I am not convinced that the possibility that a party may bring proceedings again is one which necessitates the favourable exercise of discretion then invoked before his Honour although I acknowledge that there are remarks of high authority to support the approach taken by his Honour. See Birkett v James [1978] AC 297, 319 (HL). The respondent, as it seems to me, was entitled to have the Court's discretion exercised on the material before the Court. If the respondent was entitled to have the proceedings dismissed upon that material, such an order should be made. Practical inhibitions, which it may be difficult for a court to assess, would often stand in the way of the commencement of fresh proceedings. The discretion may not be harnessed to rigid rules. See Pambula District Hospital v Herriman (1985) 14 NSWLR 387, 400F, 413. But I pass this consideration by.

The second matter referred to by his Honour was later to be repeated. He said:

"The plaintiff would, in my clear view, be well advised not to proceed, but I cannot use that argument in order to conclude that his prejudice in having the proceedings dismissed is greater or less than that suffered by the defendants in permitting them to be continued."

It is relevant, in considering an application to dismiss a claim for want of prosecution, to consider, necessarily in a preliminary way, the likelihood that the claim could not, or probably would not, succeed. This is because, in such a circumstance, any injustice caused by the peremptory termination of the proceedings is either nonexistent or minimal. Indeed, the court may then be doing the party a favour by reflecting in its order the lack of conviction of success in the litigation which may be inferred from the plaintiffs want of prosecution of the claim. So much has been said in analogous circumstances where applications are made to dismiss proceedings upon the ground that the pleading demonstrates no arguable cause of action. See eg General Steel Industries Inc v Commissioner for Railways (NSW) 112 CLR 125, 130. It has also been expressed as a relevant consideration in rejecting an application for an extension of time to sue or to appeal. If the time default is insubstantial and the claim apparently strong, or at least viable, the greater will be the likelihood that a court will provide the extension of time in the exercise of its discretion. To the contrary, if the time default is large and unexplained and preliminary examination of the cause of action demonstrates its apparent futility, a court will be less likely to provide the extension. To deny it will then involve no, or no substantial, injustice. See Galea v The Egg Corporation of New South Wales, Court of Appeal, unreported, 21 November 1989; (1989) NSWJB 216.

Insofar as Hunt J, in expressing the view that the appellant would be "well advised not to proceed" was thereby expressing doubt as to the viability of his cause of action, I respectfully beg to differ. It is noteworthy that no application had ever been made by the respondent to strike out the various imputations which the appellant pleaded. Some, if not all, of the imputations would appear to me to be arguable. They would be matters for a jury to determine. In a society such as our own, to which have come so many persons from varying ethnic communities, courts should not be insensitive to the strong feelings and possibility of hurt done by wounding words of particular significance to people in the ethnic community

concerned. In this country, the law provides protection to them, as much as to other residents without such a background.

Of course, in the present case, the law did provide its facility to the appellant. What is in issue is his tardy and apparently reluctant use of that facility. It is possible that Hunt J, at the first hearing, was saying no more than that a jury, of four English-speaking Australian citizens chosen at random, might not react well to the kind of complaint made by the appellant, and particularly in the light of his tardiness in pursuing it. In view of what was said at the second hearing, it will be necessary to return to this issue.

The result of the first hearing was that Hunt J dismissed the application. But he ordered the appellant to pay the respondent's costs. He then went on to:

"... direct that those costs be paid as soon as they have been taxed, and to order that - other than to permit the plaintiff to set the matters down for trial - they are not to proceed further until those costs and the costs ordered to be paid by the plaintiff on 9 December 1983 have been paid. I should also make it clear to the plaintiff that, if there is any further unexplained or unacceptable delay by him either in the payment of those costs or in the subsequent prosecution of his proceedings, a fresh application by the defendants to have the proceedings dismissed will almost certainly succeed. At that time, of course, he will be unable to start again."

On 28 August 1987, on the respondent's application, the matter was relisted before Hunt J. By that time, the first of the two conditions fixed by his Honour, for the avoidance of the "almost certain" success of a fresh application had been satisfied. The appellant had paid the costs ordered by his Honour. He did so on 3 July 1987. The delay in such payment is not as great as it seems. The evidence discloses that the assessment of costs for the two hearings, the subject of the order, was not forwarded to the solicitor for the respondent until 3 June 1987. The sum was therefore paid within little more than a month.

The question therefore became for his Honour whether, within the terms of his earlier observations, there had been such "further unexplained or unacceptable delay" by the appellant "in the subsequent prosecution of his proceedings" that would warrant the application's succeeding August, where it had failed in March. It is to be pointed out that the marginal additional time of five months was slight, when compared to the very great loss of time earlier between the completion of the pleadings in April 1983 and the first application for dismissal in March 1987. Four years had passed on that occasion. But Hunt J had warned the appellant. Was the further loss of time unexplained or unacceptable and did it otherwise warrant dismissal?

Upon this issue Hunt J received evidence and heard submissions. The transcript of the proceedings before his Honour on 28 August 1987 was placed before this Court. It records that the respondent appeared in person. It also records briefly that "Mr Salier appeared on the question of costs - no longer appearing in the matter for the defendant". Counsel then appearing for the appellant tendered copy of two letters written by Mr Salier to the solicitors for the appellant dated 12 August and 17 August 1987. These letters have also been placed before this Court. They refer to correspondence of July 1987 and a telephone conversation between Mr Salier and Mr Margiotta, solicitor for the appellant. At this stage the parties, through those solicitors, were apparently exploring settlement of the action. The letter of 12 August 1987 said (relevantly):

Mr Berechet telephoned the writer on 11th August 1987.

He confirmed that our instructions are that in respect of any suggestions for settlement the only basis on which he would be prepared to settle is that there would be a verdict for the defendant in the proceedings and your client pay the whole of the costs of our client incurred to date.

In the event that settlement cannot proceed on that basis we are instructed that the Application presently returnable on 14 August 1987, will be pursued by Mr Berechet."

I have previously stated that in March 1987 Mr Salier had filed a notice of ceasing to act as a solicitor for Mr Berechet. However, by his letter of 17 August 1987 Mr Salier confirmed that "there is no evidence on our file that copy of the notice of ceasing to act as solicitor was served upon your firm". It was sent with the letter of that day. Notwithstanding that notice (of which those representing the appellant were unaware) Mr Salier continued (apparently after a conversation with Mr Berechet) to act as a "conduit" for the endeavours to settle the matter. Those endeavours apparently extended at least from late July 1987 until mid-August 1987.

Mr Margiotta, in his oral evidence before Hunt J recounted three attempts for the appellant, to file a notice setting the case down for trial. He took these steps after the costs had been paid on 30 July 1987. On a date after then, his clerk attempted to file the notice in the Supreme Court. According to Mr Margiotta, the file was said to be unavailable, being in the "basement" - doubtless because of its great age. A second attempt was made, apparently on 10 August with the same result. It was only on the third attempt, on 17 August 1987 that the notice was accepted. Mr Margiotta also gave evidence about suffering an illness and that he had been overseas for some part of the period.

Hunt J accepted all this evidence, including Mr Margiotta's impression that Mr Salier was still acting for the respondent. He also accepted that there were apparently "some efforts to settle the matter with Mr Salier acting as a conduit during the current month". But according to his Honour "it was all far too late'. This conclusion means, that according to Hunt J it had become too late by July 1987. This was less than four months after the earlier hearing. At least three of those four months could reasonably be explained by the delay awaiting the assessment of the costs which his Honour had earlier ordered to be paid. Such costs were then paid within that month. In view of the matters accepted by Hunt J, it is difficult to see what it was that rendered the attempts to settle and set the matter down for trial "far too late". The one certain difference between the earlier proceedings and those then before Hunt J was that, between the two hearings, the limitation bar had descended. Now, the proceedings could be finally terminated and the appellant would be out of court.

Hunt J returned in his concluding remarks to something which he says he did not take into account but which, in my opinion, he was entitled to take into account:

"This is an action in which the plaintiff's chances of success are probably of a small order only but I do not, for the purposes of coming to my final decision, take that opinion into account. Nor do I take into account the clear circumstance that I would be doing everybody, including the plaintiff, a favour if the matter was killed, as it should have been at birth. I come to my final decision simply upon the basis that the plaintiff has failed properly to comply with the directions which were given and that he has delayed the matter sufficiently to show that not

even what was said on 27 March has taught him that he must proceed with expedition in this matter. The defendant's prejudice has been magnified by this further delay."

It was in these circumstances that his Honour proceeded to dismiss the claim on the basis of its non-prosecution."

A number of principles can be stated as applicable to the appeal: The decision by Hunt J results in a final judgment being entered in favour of the

respondent. The appellant, who brought proceedings to the Supreme Court and still wishes to have them heard on the merits. By the order challenged he is denied such a hearing. To deny any person who wishes to bring a contest the opportunity of a hearing and the resolution of that contest in court after evidence and argument is, of course, a serious thing. Our system of justice reserves peremptory orders such as here made to the clear case precisely because it operates on a rational principle of reasoned decision-making. Dismissal for want of prosecution, whether under the Rules or the inherent jurisdiction of the court, is therefore reserved (as other peremptory relief) to the clear instance where it is manifestly warranted. It is not available as a punishment or to teach litigants that they cannot trifle with judicial impatience. In the present congested state of court lists, delay can have a serious effect upon the opposing party. Even when Rules of Court and judicial orders are strictly obeyed, there is still further delay whilst a case awaits a hearing. Thus, a jury trial of the present action would, if it be permitted, not come on in the ordinary course (without an order of expedition) for a number of years. Even so, the appellant is not responsible for ordinary delays of the courts. He should be deprived of his normal entitlement to a trial of his action on the merits only in a clear case. The circumstances which justify such an order should be manifest and plainly demonstrated;

The discretion to dismiss the proceedings for want of prosecution exists both in the inherent jurisdiction of the Court to protect its process and also in particular Rules of Court, to one of which Hunt J made specific reference. His Honour referred to Pt33 r6 of the Supreme Court Rules. This Rule says:

"6(1) Where a plaintiff does not, within six weeks after the pleadings are closed, set the proceedings down for trial, the Court, on motion by any party may, on terms, dismiss the proceedings or make such other order as the Court thinks fit." There is no doubt that the defaults of the appellant attracted this Rule. The power of Hunt J to act as he did is not in dispute. What is disputed is his Honour's exercise of that power and especially in the light of the reasons given by him;

The decision made by his Honour is one which may be classified as of a procedural character, ie one of practice. This is not ordinarily a matter which will attract the intervention of this Court. Practice decisions must be made by the hundreds every day in the trial Divisions of the Supreme Court. Restraint is exercised by this and other appellate courts from intervening to correct such decisions (even where a different conclusion might have been reached) simply because there must be an end to litigation. The reasons for such restraint are too well known and too frequently rehearsed to be repeated here. Nevertheless, where, as here, the effect of the order is to terminate the appellant's claim entirely, it is not interlocutory in character. The contrary was not argued. It is a final order disposing forever of the appellant's right to a trial of his action on the merits. The inhibitions which require special restraint in interlocutory orders do not operate with the same powerful force upon a final order such as is now under challenge;

The exercise of the discretion, both under the Rule and under the inherent jurisdiction of the Court, involves very much a matter of impression. No fixed rules may be laid down in advance, for the circumstances of each case will be different. Stollznow v Calbert [1980] 2 NSWLR 749, 751. In reaching his conclusion, Hunt J referred to the speech of Lord Diplock in Birkett v James [1978] AC 297, 318 (HL). That was a case of an application for dismissal of an action for want of prosecution. The plaintiff had sued upon an oral agreement said to have been made in December 1969. His writ was issued in 1972. There was a great delay between 1973 and 1975. At first instance, the action was dismissed for want of prosecution. The English Court of Appeal dismissed an appeal. However, the House of Lords reversed the Court of Appeal.

It stressed that the power of a court to dismiss an action for want of prosecution should be exercised only where the plaintiff's default had been intentional and contumelious or where there had been an inordinate and inexcusable delay on his, or his lawyer's part giving rise to a substantial risk that a fair trial would not be possible or to serious prejudice to the defendant. Birkett v James, and particularly Lord Diplock's expression of the approach to be taken, has been referred to in several cases in this Court. See eg Stollznow (above) and Alexander v Cambridge Credit Corporation Limited (Receivers Appointed) (No 3), Court of Appeal, unreported, 30 May 1986; (1986) NSWJB 103. Birkett v James was obviously in his Honour's mind as he approached the exercise of his discretion. That decision has recently come in for some criticism in England. See eg Westminster City Council v Clifford Culpin and Partners, unreported, Court of Appeal (England) 18 June 1987 and M Beaumont, "Want of Prosecution: a retreat from Birkett v James" (1989) 86 Law Soc Guardian Gazette 14 and cases there cited. However it has also recently been reaffirmed by the House of Lords. See Department of Transport v Chris Smaller (Transport) Ltd [1989] 2 WLR 578, 581 (HL). Courts in Australia are not bound by Birkett or Smaller. They should not follow those decisions to the extent that they suggest that fixed rules may be substituted for the exercise of a discretion as required by the consideration of the distinct circumstances of each case. Where serious consequences will follow virtually automatically from orders, in default of which peremptory dismissal of an action will result, it is an obvious requirement of fairness that those earlier orders should be clear. If they are to have, legally or effectively, a self-executing operation, it is plainly necessary that their terms should be precise and that there should be no room for doubt on the part of the party in jeopardy. The dangers of self-executing orders are obvious. In so far as it was here suggested that what had been said on 27 March 1987 had not been complied with, it is essential to go back to, and analyse, precisely what was said and ordered on that occasion and to measure against those orders what the appellant did and did not do.

I therefore turn back to what Hunt J did in the August hearing. I approach his Honour's order with a due measure of understanding of the need for a sense of urgency in defamation proceedings and respect for the great experience which his Honour brings to bear in the Defamation List. In accordance with legal principle, I must also reserve a disturbance by this Court of the exercise by his Honour of his undoubted discretion to a case where it is clear that the discretion has miscarried. Unfortunately, and with respect to his Honour, I believe that it did here.

Even on the criteria stated by Lord Diplock in Birkett, it cannot, I believe, be said that the default of the appellant between March and July was intentional and contumelious. It is to be noted that the criteria stated by Lord Diplock are cumulative. The disobedience must amount to an abuse of the process of the court. In the light of the explanation for the delay waiting the assessment of costs, the prompt payment in a month of those costs and the immediate commencement thereafter of attempts to set the matter down for trial, such a firm conclusion could not be reached in this case. Nor do I believe that a conclusion could reasonably be reached that the marginal delay of a further five months in all (two months only after the assessment of costs) was "inordinate" and "inexcusable". Cf Birkett v James, ibid, 319. Indeed, the excuses given were partly accepted by his Honour. The only significant delay was that between the end of March and the beginning of June when the costs were being assessed for the respondent. But that was a delay occasioned by the respondent's former solicitors, not by the appellant. Nor can it be said that the delay gave rise to "a substantial risk that it is not possible to have a fair trial of the issues in the action". The additional delay is what is in issue. This is because in March his Honour had not felt the making of the order to be warranted. Although he said that "the defendant's prejudice had been magnified by this further delay", no evidence of real prejudice was called. The only suggestion made, that of anxiety, had been rejected by his Honour in March 1987. Therefore, even accepting the criteria stated by Lord Diplock in Birkett v James, the peremptory order made would not be justified. Those criteria are stringently expressed, for the reasons which I have already outlined.

There is an additional consideration. Quite apart from Birkett v James it is essential, as this Court said in Stollznow (at 751), in each case of delay to weigh up, in the end, the prejudice to the defendant against the loss to the plaintiff of his cause of action. That, Hunt J did in the March hearing. But in the August hearing there is no reference whatever to this consideration. The only mention of it in passing is a reference to the "plaintiffs chances of success" which his Honour considered to be "probably of a small order" but which he said he put out of his mind and declined to take into account. Whilst it may be presumed that his Honour would be fully aware of the seriousness of depriving a party of a trial on the merits, there is no reflection of this in his reasons.

In my opinion the appellant's likelihood of success in the action was greater than Hunt J judged it. If a jury determined that the imputations pleaded were open upon the matter complained of and that they were published by the respondent concerning the appellant, it would be open to the jury to take a very serious view of the matter indeed. Delay would certainly provide the respondent with a significant forensic argument. But suggestions that a medical practitioner neglected patients for political reasons; was a religious hypocrite or was timorously supporting the oppressive Communist regime in Romania instead of tending to patients and citizens in Australia are capable of being viewed by a jury most seriously. To the observation that the publication would be unlikely to change the opinion of many readers concerning the appellant, the answer comes back that the journal is an international one. It is alleged to be published widely. This Court knows nothing of the diversity and geographical spread of the Romanian-speaking community who would have received the journal both in this jurisdiction and beyond.

The result is that, even approached with appropriate reluctance to disturb such an order, I am led (as indeed the House of Lords was in Birkett v James) to the conclusion that, in this case, the order was wrongly made because the stringent requirements for it were not, or were not clearly, made out. The marginal delay complained of was not deliberate and contumelious. Most of it was explained. Most of the explanations were either uncontested or were accepted by Hunt J. No evidence was received of additional actual prejudice to the respondent. The great part of the additional delay appears to have been occasioned by delay in the nomination of the respondent's costs which had to be paid. Although the appellant might (as his Honour's earlier orders contemplated) have set the matters down for trial even without the payment of those costs, it was arguable that delaying until the costs were paid was reasonable in the circumstances. Furthermore as Mr Margiotta said in evidence admitted in this Court, there were "numerous conversations" between himself and Mr Salier about settlement at this time. As well, it is not clearly demonstrated that his Honour weighed up the respective interests of the parties. One interest, relevant to the appellant's prospect of success, he expressly said he put out of his mind.

The exercise of discretion miscarried. This Court has the materials upon which to exercise the discretion for itself. I am led to propose the following orders:

Set aside the orders of David Hunt J of 28 August 1987;

In lieu thereof, order that the application for dismissal of the proceedings for want of prosecution be dismissed;

Order that the costs of the application be costs in the cause;

Order that the respondent pay the appellant's costs of the appeal but have, in respect thereof, a certificate under the Suitors' Fund Act 1951; and

Return the proceedings to the Common Law Division for trial.

Samuels JA I need not set out the facts which have been recorded in the judgment of Kirby P which I have had the advantage of reading in draft.

I find Hunt J's reasons somewhat ambiguous and my own view of the result of the appeal depends upon which of two possible versions (as it seems to me) is the correct one to adopt in the sense of the one which correctly expresses his Honour's reasoning.

The learned judge, having recapitulated the orders and exhortations made on 27 March, continued by saying that notwithstanding these stimuli, the plaintiff (the present appellant) did not set the matter down for trial until 17 August 1987. He notes facts which make both for and against the plaintiff's position including the acceptance of evidence that the plaintiffs solicitor was overseas for some of the period, and that during August, at least, there were some efforts made to settle the proceeding. So far, it seems that his Honour is weighing up the significant facts in order to determine on which side the balance of justice descends: see Witten v Lombard Australia Ltd [1968] 88 WN (Pt 1) 405 at 411 and 412 cited by Moffitt P in Stollznow v Calvert [1980] 2 NSWLR 749 at 751. If Hunt J's decision was reached in this way, and according to that reasoning, I am inclined to think that it would be unassailable as the exercise of a discretion in a matter of procedure which is not apparently tainted by error of the kind which may justify or compel appellate intervention: see In Re The Will of FB Gilbert (Deceased) 46 SR 318 and Stollznow ibid.

However, the reasons for judgment continue with his Honour noting that he does not take account of the plaintiff's rather unlikely prospects of success in the action in "coming to my final decision". And then he says: "I come to my final

decision simply upon the basis that the plaintiff has failed promptly to comply with the directions which were given and he has delayed the matter sufficiently to show that not even what was said on 27 March has taught him that he must proceed with expedition in this matter. The defendant's prejudice has been magnified by this further delay". The use of the phrase "I come to my decision simply upon the basis that" suggests to me that that basis was either the sole ground for reaching the decision or was, at least, a necessary ground without which the same decision might (I cannot say would) not have been reached. Whether the learned judge might have reached the same decision by a different path, invoking perhaps the earlier passages in the judgment to which I have referred, is not to the point. I conclude that, so far as the material before us reveals, the learned judge took critical account of the plaintiff's failure to comply promptly with his Honour's directions. This then is the way in which I feel the judgment must be read, and, so understood, it reveals, if I may respectfully say so, what appears to me to be an error.

The orders made on 27 March related to the taxation and payment of costs and prohibited the plaintiff from proceeding further in the matter until the costs were paid. To that prohibition there was an express exception which was that the plaintiff might set the matter down for trial before the costs had been paid. But there was no order made that the plaintiff should do so and yet, since it was obviously the failure to set down which most moved Hunt J, it must follow that the failure to comply with "the directions which were given" must mean that the omission to set the matter down earlier than 17 August amounts to the failure to comply which was the factor which led his Honour to his final decision. The error, of course, resides in the fact that there was no direction about setting the matter down, with which the plaintiff's not acting until August could be a non-compliance. Thus, there was, in my respectful opinion, a miscarriage of his Honour's discretion within the celebrated formula laid down in House v The King 55 CLR 499 at 505 in that the learned judge mistook the facts or, it may be, took into account an irrelevant matter - that is to say, a matter irrelevant to the grounds upon which he purported to exercise discretion.

That being so, it is unnecessary for me to examine in any detail the way in which a judicial discretion of this kind should be exercised. In any event, that task has already been performed by this Court (Moffitt P, Hope and Mahoney JJA) in Stollznow. I think that I should say, perhaps, that in that case Moffitt P at 751 said this:

"While useful guidance is provided by the manner of exercise of the discretion in other cases, and by the factors considered in those cases to favour the exercise of the discretion in a particular way, each case must depend on its own facts. It would be contrary to what I understand to be the accepted law in this country, to confine the exercise of a judicial discretion by judgemade rigid formulae."

Accordingly, there must therefore be some tension between this view and that expressed by the House of Lords in Birkett v James [1978] AC 297 and, in particular, with what was said by Lord Diplock in that case at 318. Certainly, where the matters to which his Lordship there refers have been positively established, it would be improbable that the court would not exercise its discretion in support of the moving party, and against the party guilty of disobedience of a peremptory order of the court or of inordinate and inexcusable delay giving rise to a substantial risk that it will not be possible to have a fair trial. But, even so, the exercise of discretion should not be circumscribed by regarding these as criteria which will compel a particular result. They should therefore be

regarded, in my respectful view, as guidelines only, or as indications of those factors which might incline a court to make orders of the kind in question. I should add that in Alexander v Cambridge Credit Corporation Ltd (Receivers Appointed) (No 3) (Court of Appeal, 30 May 1986 unreported) the claimants, rather than the court itself, accepted Lord Diplock's speech as stating the relevant law.

Since Hunt J's exercise of discretion miscarried this Court must make the decision itself. In all the circumstances I consider that the appellant did not act unreasonably, and that the prejudice which would be occasioned to him by summary termination of the proceeding outweighs any which the respondent has already suffered, and might still suffer in the future, as a result of the delay for which the appellant has undoubtedly been responsible. Accordingly, I would not dismiss the proceeding for want of prosecution, and I agree in the orders proposed by the President.

Meagher JA I have read in draft the reasons of Kirby P in this matter, and I reluctantly have come to the same conclusion as his Honour, although for somewhat different reasons.

The alleged defamatory utterances of which the plaintiff complains were apparently published in 1981-1982; the Statement of Claim was dated July 1982; pleadings were completed when the plaintiff's Reply was filed in April 1983. Yet the plaintiff did not set the matter down for hearing between 1983 and 1987. This delay is inexcusable and remains unexplained.

Not surprisingly, the defendant moved in March 1987 to have the proceedings dismissed for want of prosecution. On this occasion Hunt J said:

"Tf this was a matter in which the Statute of Limitations had already expired, I would have drawn the clear inference that the plaintiff was so unconcerned with the progress of his proceedings that they should not be permitted to continue. Indeed, an inference of the plaintiff's lack of concern is still available, and I draw it. But I am nevertheless faced with the situation that if I dismiss the proceedings for want of prosecution, the plaintiff would be in a position to start fresh proceedings within the relevant limitation period."

His Honour, therefore, refused the application. In this regard, in my view, his Honour's decision was unexceptionable. The fact that an order if made would be a futility has always been recognized as a valid ground for refusing to make a discretionary order.

"T propose, therefore, to refuse the applications, but to order the plaintiff to pay the defendant's costs of those applications, to direct that those costs be paid as soon as they have been taxed, and to order that - other than to permit the plaintiff to set the matters down for trial - they are not to proceed further until those costs and the costs ordered to be paid by the plaintiff on 9 December 1983 have been paid. I should also make it clear to the plaintiff that, if there is any further unexplained or unacceptable delay by him either in the payment of those costs or in the subsequent prosecution of his proceedings, a fresh application by the defendants to have the proceedings dismissed will almost certainly succeed. At that time, of course, he will be unable to start again."

These directions, in my view, did not oblige the plaintiff to set the proceedings down for trial either within any specific time limit or at all. They directed the taxation and payment of costs; and they also directed all "subsequent" steps to be

taken without delay. The word "subsequent" must fairly be read as meaning "after taxation of costs". They permitted, but did not direct, an immediate setting down for trial.

The evidence discloses that the costs were taxed and paid with reasonable expedition, but the matter was not set down for trial until July 1987.

On the hearing of the defendant's second application to have the matter dismissed for want of prosecution, Hunt J in August 1987 said:

"T come to my final decision simply upon the basis that the plaintiff has failed promptly to comply with the directions which were given and he has delayed the matters sufficiently to show that not event what was said on 27 March has taught him that he must proceed with expedition in this matter. The defendant's prejudice has been magnified by this further delay."

This conclusion seems to me insupportable. There was no failure to comply with the order for costs, and no direction was even given as to the setting down for trial. There was no failure to take any step "subsequent to" taxation of costs.

As I have said, I have reached this conclusion with great reluctance. This is because a trial judge's decision on a discretionary matter should be interfered with only in exceptional circumstances: see Re Will of Gilbert (1946) 46 SR (NSW) 318. This is particularly so in matters of practice and procedure. It is all the more so when one is dealing with a specialized field like defamation in which the trial judge has considerable experience and expertise. Nonetheless, in my view the decision in question was vitiated by the error of law to which I have referred. I therefore concur in the making of the orders proposed by the President.

Set aside the orders of David Hunt J of 28 August 1987;

In lieu thereof, order that the application for dismissal of the proceedings for want of prosecution be dismissed;

Order that the costs of the application be costs in the cause;

Order that the respondent pay the appellant's costs of the appeal but have, in respect thereof, a certificate under the Suitors' Fund Act 1951; and

Return the proceedings to the Common Law Division for trial.

Counsel for the Appellant; J Hamilton QC with H Gulpers Solicitors for the Appellant: Margiotta Counsel for the Respondent: In person

Solicitors for the Respondent: White Barnes and McGuire

At a glance

Court

Decision date

Before

Source

Judgment (98 paragraphs)

Parties

Cases Cited (1)

Cited By (1)