JOHNSON J: On 25 October 2019, I delivered a judgment in proceedings between the Plaintiffs, Richard Craig Sutherland and Quadratus Pty Limited (Subject to Deed of Company Arrangement) (ACN 072 537 912), and the Defendant, GHR Accounting Group Pty Limited, with respect to an application by the Defendant that the proceedings be dismissed under Rule 12.7 Uniform Civil Procedure Rules 2005 ("UCPR") upon the basis that the Plaintiffs had not prosecuted the proceedings with due despatch: Sutherland and Anor v GHR Accounting Group Pty Limited (No. 1) [2019] NSWSC 1635 ("Sutherland (No. 1)").
In that judgment, I outlined the lengthy and tortuous history of this litigation in the Court. The litigation has come before a number of Judges and Harrison AsJ who have delivered judgments referred to in Sutherland (No. 1).
The particular foundation for the application made on 25 October 2019 concerned continuing failures by the Plaintiffs, and, in particular, Mr Sutherland (who is the active Plaintiff) to comply with orders of the Court with respect to discovery and particulars.
I note that Mr Sutherland is unrepresented and seeks to appear, as well, for the Second Plaintiff.
In Sutherland (No. 1), I spelt out the unhappy history of the litigation since April 2019, with continuing failures to comply with orders for discovery and particulars. This is to be considered against the background of litigation relating to events which occurred a significant number of years ago.
As was made clear in Sutherland (No. 1), the Court effectively stayed its hand from the remedy of last resort sought by the Defendant, being the dismissal of the proceedings for want of due despatch. In taking that approach, I had regard to the request by Mr Sutherland for four more weeks to comply with the orders of the Court.
As Sutherland (No. 1) (at [22]-[23]) makes clear, in case there had been any prior confusion on the part of Mr Sutherland, the submissions made on that day emphasised what was required of Mr Sutherland to comply with the orders of the Court, with respect to particulars and discovery.
Sutherland and Anor v GHR Accounting Group Pty Limited [2019] NSWSC 1636 | Case summary | Zoe
I indicated in Sutherland (No. 1) (at [40]) that should the Plaintiffs not comply with the orders of the Court by provision of proper responses to the request for particulars and discovery by 21 November 2019, then the litigation may well have "reached the end of the line given the multiple indulgences extended to the Plaintiffs against the background of this litigation". I made clear that this was an opportunity being given to Mr Sutherland to comply with the orders of the Court.
I note that a copy of Sutherland (No. 1) was emailed by my Associate to the parties on 28 October 2019, including to Mr Sutherland at his provided email address.
Today, Mr Simpkins, who appears for the Defendant, has read the affidavit of Laura Kate Reisz affirmed 21 November 2019. That affidavit reveals that on 20 November 2019 an email was received by her from Mr Sutherland with a number of documents annexed. There was a letter from Mr Sutherland of 20 November 2019 together with a document headed "List of Requested Documents" and a document headed "Response to Request for Particulars" which had some handwritten and typed documents which accompanied it.
On 20 November 2019, Ms Reisz sent a letter to Mr Sutherland indicating that, in the Defendant's view, the documents provided did not comply with the request for further and better particulars in a number of fundamental respects, and that the list of requested documents furnished with respect to discovery failed to comply with Rules 21.3 and 21.4 UCPR both as to form and verification. The Defendant made clear that it would be argued today that there was continuing failure by Mr Sutherland to comply with the orders.
FIRST PLAINTIFF: I did not receive that letter, your Honour.
HIS HONOUR: The letter is in evidence Mr Sutherland. Please remain seated. Thank you.
Mr Sutherland has risen to inform the Court he did not receive that letter of 20 November 2019. I note that the letter was sent by email, presumably to the same email address to which my Associate sent a copy of the judgment on 28 October 2019. Whether or not Mr Sutherland received that letter, the content of the letter would have been hardly surprising.
It is clear on the face of the documents provided by Mr Sutherland that they fail to comply, both in form and substance, with respect to discovery and the provision of further and better particulars. Having regard to what was discussed at the hearing before me on 25 October 2019, it was not a matter for the Defendant to have to tell Mr Sutherland of the fundamental failures on his part with respect to these documents. The fact that Mr Sutherland states that he did not receive that letter does not take the matter any further from the point of view of the function of the Court today.
In light of the steps taken by Mr Sutherland since 25 October 2019, Mr Simpkins has pressed the application that the proceedings be dismissed under Rule 12.7 UCPR on the basis that the Plaintiffs have not prosecuted the proceedings with due despatch. Mr Simpkins submits that there is continuing failure to comply with orders of the Court, that the deficiencies in the documents provided are not merely defects as to form but substance, and that there is a continuing failure on the part of Mr Sutherland to comply with orders of the Court.
Mr Sutherland argues that the documents provided are responsive and informative to the requests made. He submits that although the list of requested documents may not comply with the UCPR, it could be amended so that it does comply with the Rules. With respect to the response to the request for particulars, Mr Sutherland submits that it is responsive, and that the Defendant really knows the answers to all of these things in any event.
Mr Sutherland's submission appears to be that the litigation is clear-cut and meritorious, that the merits of the litigation are obvious, and that this ought be clear to the Defendant at this stage.
Mr Sutherland submits that it would be contrary to the interests of justice to dismiss the proceedings at this point given their apparent merit.
Section 56 Civil Procedure Act 2005 ("the Act") sets out the overriding purpose of civil litigation in this Court. It is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. Section 56(3) provides that a party to civil proceedings is under a duty to assist the Court to further that overriding purpose and, to that effect, to participate in the processes of the Court and to comply with directions and orders of the Court.
Section 58 of the Act provides that, in deciding whether to make any order or direction for the management of proceedings, the Court must seek to act in accordance with the dictates of justice. Section 58(2) provides that, for the purpose of determining what are the dictates of justice in a particular case, the Court must have regard to the provisions of ss.56 and 57 of the Act. In addition, the Court may have regard to matters including the degree of difficulty or complexity to which the issues in the proceedings give rise, the degree of expedition with which the respective parties have approached the proceedings (including the degree to which they have been timely in their interlocutory activities), the degree to which any lack of expedition in approaching the proceedings has arisen from circumstances beyond the control of the respective parties, the degree to which the respective parties have fulfilled their duties under s.56(3) of the Act, the degree of injustice that would be suffered by the respective parties as a consequence of any order or direction and such other matters as the Court considers relevant in the circumstances of the case.
Section 59 of the Act provides that, in any proceedings, the practice and procedure of the Court should be implemented with the object of eliminating any lapse of time between the commencement of the proceedings and their final determination beyond that reasonably required for the interlocutory activities necessary for the fair and just determination of the issues in dispute between the parties and the preparation of the case for trial.
Section 61 of the Act provides that directions may be given as to practice and procedure generally in civil proceedings. Section 61(3) provides that if a party to whom such a direction has been given fails to comply with the direction, the Court may by order do one or more of a number of things, including dismissing the proceedings whether generally and in relation to a particular cause of action, or in relation to the whole or part of a particular claim.
That statutory scheme provides the background to the task which the Court is to exercise today.
The history of this litigation has extended over a number of years as set out in Sutherland (No. 1). As I noted in Sutherland (No. 1) (at [24]), the obligations upon parties under s.56 of the Act constitute a fundamental starting point. I noted in Sutherland (No. 1) (at [25]-[31]), the exceptional nature of the remedy of summary dismissal for want of due despatch, with reference being made to a number of cases which have emphasised that point, but also the clear power of the Court to exercise the power and grant that remedy in an appropriate case.
I observed in Sutherland (No. 1) (at [29]) that the issues of discovery and particulars were important procedural features of civil litigation, and that litigants such as the Plaintiffs have an obligation to participate in the litigation, and comply with orders of the Court, including the giving of discovery and proper responses to request for particulars.
I noted in Sutherland (No. 1) (at [34]) that the failure of the Plaintiffs to comply with orders of the Court had meant that the litigation had effectively stalled.
I also noted in Sutherland (No. 1) (at [37]) that it is Mr Sutherland who has determined to bring this litigation on behalf of the Plaintiffs, and that the Court cannot, effectively extend, on a type of open-ended basis, time for him to comply with his obligations as a litigant to obey orders of the Court.
It is against that background, set out with clarity and at some length in Sutherland (No. 1), that the response of Mr Sutherland to the orders of the Court must now be considered.
I emphasise that the Plaintiffs are under an obligation to comply with orders of the Court in both form and substance. In my view, the response of Mr Sutherland with respect to discovery is fundamentally deficient as to compliance with the relevant Rules. Beyond that, however, and more fundamentally, it seems to me that Mr Sutherland is not providing what is required by law and the Court (and not just the Defendant) in the process of giving discovery.
Mr Sutherland's purported response to the request for particulars does not seek to engage at all with the request for particulars. The request for particulars dated 6 May 2019 appears behind Tab 7 of MFI 2, a folder which was utilised at the hearing on 25 October 2019. Mr Sutherland has completely failed to respond to a structured request for particulars in any meaningful way.
I regret to say that it suggests a mindset on Mr Sutherland's part that he will do things his way and not the way the law and the Court requires. Having regard to what has happened up to this point, I regret to say there is no real prospect of a different approach being demonstrated by Mr Sutherland. This is the way in which he will continue to approach this litigation.
Mr Sutherland made clear, both on 25 October 2019 and today, that he regards this litigation as clearly meritorious and, in a sense, that he does not need to comply with his obligations as a litigant because it is a clear-cut case so that the Defendant should just admit liability and pay out. Civil litigation does not proceed in that way.
This is not litigation which has only been on foot for a few months. It has been on foot for years and Mr Sutherland has been appearing in the litigation for years. He has had opportunities from other Judges of the Court, and from Harrison AsJ, to comply with orders of the Court in discharge of his obligation under s.56(3) of the Act.
It seems to me that Mr Sutherland's responses of 20 November 2019 indicate an unwillingness to comply with his obligations. He wishes the litigation to be run on his terms. The problem is that the purported response to the request for particulars is entirely unresponsive. It is a failure to comply with the order of the Court. It does not address particular questions. It includes propositions where Mr Sutherland merely restates the case he is putting in his terms, and attaches some handwritten and typed documents which are not responsive to the request for particulars.
Having regard to Mr Sutherland's submissions made today, I regret to say that the Court can have no confidence that, if this litigation continues, he will approach it in any different way. A considerable amount of Court time has been taken up so far.
I gave Mr Sutherland an opportunity a month ago, on what I thought were clear terms, and he has not taken advantage of that opportunity. He has not complied with the orders of the Court, and there is no realistic and objective foundation for thinking that things will alter if more time was given.
The Court has a responsibility, under the various sections of the Act which I have mentioned, in the conduct of civil litigation. I have regard to the factors which I have mentioned in s.58(2) of the Act. I have kept in mind the degree of injustice that may be suffered by the Plaintiffs if the proceedings are dismissed. It is difficult at this stage to form any view about the merit of this litigation because it remains, after several years, in a relative state of disorder, certainly insofar as Mr Sutherland's efforts to comply with his obligations as a litigant. It is clear that Mr Sutherland would regard any order dismissing the proceedings as being unjust to him.
I bear in mind that the question of injustice relates to all parties in the litigation, as well as the other provisions in the Act which affect the functions and duties of the Court and the impact of litigation on other parties in proceedings before the Court.
Mr Sutherland has not complied with the orders of the Court made most recently on 25 October 2019. There is a pattern of conduct on his part indicative of non-compliance with orders of the Court. As mentioned, I have no confidence that the position would change if the litigation was allowed to continue.
I bear in mind the principles which I set out in Sutherland (No. 1). In my view, a foundation now exists for the grant of the exceptional remedy of dismissing the proceedings for want of due despatch.
Accordingly, I order that the proceedings are dismissed under Rule 12.7 of the Uniform Civil Procedure Rules 2005 upon the basis that the Plaintiffs have not prosecuted the proceedings with due despatch.
[Submissions were made as to costs].
Mr Simpkins seeks an order for costs. Mr Sutherland opposes an order for costs being made against the Plaintiffs. Costs should follow the event. I order that the Plaintiffs pay the Defendant's costs of the proceedings.
[2]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 27 November 2019