Symbion Medical Centre Operations Pty Limited v Richard Spence Alexander

Greetings Oxford Koala Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33 CASES CITED : Ron Hodgson Motors Cabramatta Pty Ltd v Wewoka Pty Ltd t/as BP Cabramatta Motors (Supreme Court of New South Wales, Waddell CJ in Eq, 30 March 1989, unreported) Vaughan v Dawson [2005] NSWSC 33

Symbion Medical Centre Operations Pty Limited (Plaintiff) Richard Spence Alexander (First defendant) PARTIES : Howard John Oxley (Second defendant) Nicholas Robin Smith (Third defendant) Healthscope Medical Centres Pty Limited (Fourth defendant)

Mr G Lucarelli (Plaintiff) COUNSEL : Mr A Moses SC, Mr Y Shariff (First, second and third defendants) Mr J Lockhart (Fourth defendant)

Massey Bailey Solicitors & Consultants (Plaintiff) SOLICITORS : Morris Legal (First, second and third defendants) Allens Arthur Robinson (Fourth defendant)

• 1 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION EXPEDITION LIST

Date of Hearing: 8 May 2009 Date of Judgment: 11 May 2009

1359/09 Symbion Medical Centre Operations Pty Limited v Richard Spence Alexander & 3 ors JUDGMENT (ex tempore)

1 REIN J: The plaintiff ("Symbion") purchased a medical practice, which I shall refer to as "the Practice", from the first to third defendants. The first to third defendants agreed as part of the sale to enter into service agreements with Symbion by which they agreed to provide their services for five years at the Practice. That period was subsequently extended to 2 February 2009. It was a term of the service agreements that the defendants would not work within a five kilometre, or, alternatively a three kilometre, or, alternatively a two kilometre radius of the Practice on their departure and for a period of twelve months thereafter.

2 On 2 February the first to third defendants left the Practice giving notice as required. They immediately then commenced in a new practice at a surgery which on Symbion's case is 1.8 kilometres from the Practice. That new surgery is part of the business of Healthscope Medical Centres Pty Limited ("Healthscope"). On 5 February Symbion commenced proceedings against the first to third defendants. On 13 February when the matter came before Palmer J Symbion did not press for an interlocutory injunction against the three defendants when those defendants agreed to keep records of their attendances on patients in their new practice. The matter was listed before the Expedition List Judge, at that time Brereton J, on 20 February and his Honour fixed a four day hearing of the matter on 18 May on the question of liability only.

3 On Friday, 1 May, the parties appeared before me. The plaintiff was seeking to join Healthscope as a fourth defendant. Healthscope did not object to the joinder provided that the hearing date on liability was not maintained, as it asserted, and the plaintiff accepted, that it would not have sufficient time within which to prepare for a hearing on the allocated date. At the request of the plaintiff, and with the defendants' consent, I vacated the hearing date and stood the matter over to last Friday. On last Friday, Symbion sought a new hearing date on liability with an estimate of five days. The defendants resisted the application for a separate hearing on liability which they estimated would take, as a separate hearing, five to seven days and opposed the matter being allowed to remain in the Expedition List.

4 Mr Lucarelli of counsel appeared for the plaintiff, Mr Moses SC with Mr Shariff appeared for the first to third defendants and Mr Lockhart of counsel appeared for the fourth defendant. Two affidavits of Ms Marion Bailey were read on behalf of the plaintiff and she was cross-examined. There was an affidavit from Mr David Morris on behalf of the first to third defendants. The defendants argued that the plaintiff ought to have joined Healthscope earlier and particularly given the contents of Exhibit 1, which was a letter that Ms Bailey sent to the principals of the first to third defendants at the new surgery. Presumably at that point Ms Bailey did not know who owned the new surgery, but within a short period of time she had become aware of Healthscope's involvement as she had had issued by the Court a subpoena to Healthscope on 17 February. There were some delays as Healthscope resisted the subpoena, and I think there was a notice to produce to the doctors, as well, in respect of documents the confidentiality of which they had an interest in protecting, and in that connection, a motion before Brereton J by Healthscope.

5 On 12 March Brereton J made orders in relation to those matters, and ultimately on 24 March Healthscope produced further documents with a regime in place for confidentiality, some of the documents being documents to which a claim for confidentiality was asserted and accepted. Further steps were taken in relation to the making of copies and documents, and on 3 April the documents were provided to Mr Lucarelli.

6 On 6 April Ms Bailey requested Mr Lucarelli to consider whether Healthscope should be joined. There were further delays until 27 April which included a need to speak with senior counsel for the plaintiff and the Easter break, but an amended statement of claim with Healthscope as a fourth defendant was not prepared until 27 April and the notice of motion relating to it was not served until 28 April.

7 There are disadvantages with a hearing on liability only and there is a general preference for cases to be heard to finality on all issues at the one time, but where there is an urgent aspect to a matter, that can encourage the conclusion that liability, or even some aspect of liability, be determined before the less urgent aspect of the proceedings. This is what Brereton J did here and no doubt his Honour thought that given the duration of the restraint it was important, that if the separate expedited hearing was of utility, it should be heard in May. I was informed that the plaintiff had sought a later date for hearing (i.e. in July) but that his Honour had fixed the date in May.

8 Now the Court is being asked to fix a fresh date which would be in July/August, if available, where a new party and a new cause of action (that is, tortuous interference which is alleged against the fourth defendant) has been added with the difficulty that some damage must be established by the plaintiff to succeed on liability. I did regard it of significance that his Honour Brereton J had already made the order for expedition in February but on reflection, the circumstances with which the Court is now concerned are different.

9 There was also a delay of eight days by the plaintiff in serving its lay and expert evidence. In relation to the lay evidence, Ms Bailey said that this was due to "the usual reasons" which were of a logistical nature involving, as I understood it, the lay witnesses.

10 Mr Moses made an attack on Ms Bailey, and the plaintiff generally, asserting that Brereton J had not been informed that the plaintiff was considering joining Healthscope, an inference which he sought to draw by the reference to Exhibit 1 as well as the overall circumstances. It was not put to Ms Bailey that she was considering joining Healthscope at the time that the application was made for a hearing date before Brereton J, and I proceed on the basis that rather than any withholding from the Court of information it is more of a case of lack of attention being given to whether Healthscope should have been joined until at least April 2009.

11 The Expedition List is created to deal with urgent matters and in this context the Court in effect is determining relative urgency since almost every litigant wishes his, her or its case to be heard as soon as possible. To fix one matter for expedition removes that time for another matter equally or more deserving of priority.

12 The plaintiff, through its advisors, was aware as at 30 January that it may have had claims against the owner of the new practice. It may not have wanted to rush into a case against that party, but having sought and obtained an expedited hearing on 20 February without having given adequate consideration as to whether or not to join Healthscope at that point it ought not have the luxury, less than four weeks before the hearing, of seeking to join a fourth party who might have more financial substance than the first to third defendants and, hence, be a worthwhile target in relation to any damages which Symbion might be able to recover should it be successful in the proceedings.

13 At that stage, that is, less than four weeks before the date fixed for the hearing, the plaintiff had to make a choice: was the urgent hearing to preclude the doctors from continuing to work for Healthscope more important than a more expanded hearing with an almost certain loss of the hearing date? The plaintiff chose the latter course, which it was entitled to do but, in my view, not at the luxury of obtaining another expedited hearing.

14 Guidance as to the working of the Expedition List can be gained from Greetings Oxford Koala Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33 ("Greetings") and see also Vaughan v Dawson [2005] NSWSC 33 at [8]. In Greetings Young J, as he then was, set out at [42] - [43] the principles which should guide the working of the list. The sixth matter was in the following terms: "Any right to expedition is a right to have the case fixed on one occasion. If after a date has been fixed it has to be vacated it is difficult indeed to justify again expediting the proceedings."

15 Ron Hodgson Motors Cabramatta Pty Ltd v Wewoka Pty Ltd t/as BP Cabramatta Motors (Supreme Court of New South Wales, Waddell CJ in Eq, 30 March 1989, unreported) was cited in support of that proposition.

16 There are two other factors of lesser importance which reinforce the view to which I have come that no second expedited date should be granted. Whilst there were some difficulties on the part of the plaintiff in obtaining documents from Healthscope, the process by which a decision was made, and ultimately notified to the fourth defendant and the other defendants, seems to have been an unduly long one given the pressing urgency required by reason of the impending hearing. The delay in serving the evidence, whilst not huge, is of more significance in the context of an expedited hearing where every effort must be made to ensure that the timetable of steps is followed.

17 The second matter is this. The new case is not one for breach of contract only but now has expanded to a claim for the tort of inducement of breach of contract which not only adds a dimension to the case but will require attention to be given to damages, whatever happens. The absence of any injunction means that, if the plaintiff is successful in a hearing in July, August or September this year, damages would need to be assessed at some future time in any event for the six to seven months passed. These factors would be, of themselves, matters which would potentially reduce the need for, or appropriateness of, an expedited hearing.

18 I conclude that the matter should not be granted a second expedition hearing and should be removed from the list.

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.