Williams & Ors v Calivil Park Holsteins Pty Ltd & Ors

Supreme Court of NSW|2009-02-04|Before: Schmidt AJ, Ms J

CITATION : Williams & Ors v Calivil Park Holsteins Pty Ltd & Ors [2009] NSWSC 31

(1) The appeal is upheld. DECISION : (2) The leave sought to file a cross claim, together with an amended defence, consistent with the terms of that cross claim is granted. That amended defence to be filed within seven days. (3) The plaintiffs are to pay the costs of the appeal and the hearing below. (4) The first defendant is to pay the plaintiffs' costs thrown away as a result of the granting of the leave.

CATCHWORDS : Appeal from decision of Associate Justice refusing leave to file cross claim - nature of appeal - error shown- operation of Civil Procedure Act 2005 - delay by first defendant not determinative - discretion to grant leave must be exercised in order to achieve the overriding purpose of Civil Procedure Act - balancing exercise required - default and delay must be considered, as well as parties' conduct otherwise in proceedings - refusing leave would not achieve the overriding purpose of Act because it would result in the real issues between parties not being put before the Court - appeal allowed - costs

LEGISLATION CITED : Civil Procedure Act 2005 Supreme Court Rules 1970

Ainsworth v Burden [2005] NSWCA 174 Clough and Rogers v Frog (1974) 48 ALJR 481; 4 ALR 615 Creasey's Grain Enterprises Pty Limited v Maltco Pty Limited [2006] NSWSC 531 Cropper v Smith (1884) 26 Ch 700 Dennis v Australian Broadcasting Corporation [2008] NSWCA 37 CASES CITED : Do Carmo v Ford Excavations Pty Ltd [1981]1 NSWLR 409 Kim v Lee & Ors (No 3) [2006] NSWSC 1213 Makucha v Brian Tucker & Associates Pty Ltd [2005] NSWCA 397 The State of Queensland and Anor v JL Holdings Pty Ltd (1997) 189 CLR 146 Sali v SPC Ltd (1993) 67 ALJR 841; 116 ALR 625 State of New South Wales v Mulcahy [2006] NSWCA 303

Ian Michael Williams - First Plaintiff Jillian Mary Williams - Second Plaintiff Angus Carl Williams - Third Plaintiff PARTIES : Calivil Park Holsteins Pty Ltd - First Defendant Dennis Culton - Second Defendant Sue Culton - Third Defendant Jayson Paul Culton - Fourth Defendant

COUNSEL : Ms LM Wilson - Plaintiffs Mr CD Wood with Ms J Wilscek - Defendants

SOLICITORS : Lumleys - Plaintiffs Morrison and Sawers - Defendants

LOWER COURT JURISDICTION : Supreme Court (Associate Judge)

LOWER COURT DATE OF DECISION : 2 September 2008

LOWER COURT MEDIUM NEUTRAL CITATION : Williams v Calivil Park Holsteins Pty Ltd [2008] NSWSC 879

17 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION POSSESSION LIST

11467/2008 Ian Michael Williams & Ors v Calivil Park Holsteins Pty Ltd & Ors

JUDGMENT 1 HER HONOUR: By notice of motion of 29 September 2008, the first defendant appeals from a decision of Malpass AsJ, refusing the first defendant leave to file a cross claim. His Honour heard that application, brought by way of motion, together with a motion brought by the plaintiffs, seeking summary judgment. The plaintiffs' motion was stood over to be dealt with at trial. No appeal has been brought in respect of that decision, but the failure to make a costs order in favour of the first defendant, is complained about. 2 The proceedings are concerned with a claim for possession of land, a farming property. The proceedings were brought in April 2008, with the possession question being dealt with by consent, in July 2008. Money claims for rent, arrears of money under a cow lease and mesne profits are yet to be dealt with. The defence was filed in early May. The cross claim was not filed until 7 August 2008, when the matter was before the Registrar to deal with the plaintiffs' motion for summary judgment. The parties' motions were then adjourned until 28 August, when they were both heard by his Honour.

The decision appealed against 3 In his reasons, Malpass AsJ noted that the cross claim had three aspects, which in his view raised material which was inconsistent with what was pleaded in the defence. His Honour took the view that there had been considerable delay, in excess of three months, in bringing the cross claim, which had not been satisfactorily explained. He accepted that this was a matter of importance in this case, taking the view that 'it may be that a purpose of the application was to bring about further delay in the disposition of these proceedings' (at [10]). 4 In his Honour's view, an onus fell on the first defendant to satisfy the Court as to its entitlement to the leave sought, there being a discretion as to whether or not it would be granted. That onus had not been met. It followed that the dictates of justice were not best served by the grant of the application (at [11] and [12]). In the circumstances, the matters of delay and a lack of satisfactory explanation therefore were matters of weight sufficient to dispose of the application (at [14]). 5 In coming to that conclusion, his Honour had regard to the plaintiffs' opposition to the leave sought. He noted the submissions that a costs order in their favour would have little utility, given the substantial amounts owed to them; the first defendant's substantial non compliance in the proceedings and the substantial prejudice which would result from the granting of the leave sought, given how it would slow the proceedings, at a time when the plaintiffs were continuing to pay $19,000 per month to service the property, plus legal costs, with no money flowing from the defendants, despite orders of the Court to make such payments. 6 Other matters raised by the plaintiffs, and also taken into account by his Honour, included the need to return to the evidentiary timetable if the leave sought were granted; the plaintiffs needing to pursue an application for security for costs; the need to amend the defence and the plaintiffs to put on a defence to the cross claim, as well as putting on further evidence, with the result that any hearing would be further delayed.

The parties' cases on appeal 7 It was common ground that an appeal such as this is subject to the same principles as those governing an appeal from a judge to the Court of Appeal. (See Do Carmo v Ford Excavations Pty Ltd [1981] 1 NSWLR 409 and Creasey's Grain Enterprises Pty Limited v Maltco Pty Limited [2006] NSWSC 531 at [49]). 8 The first defendant's case was that his Honour had erred in the approach taken, having applied the wrong test in refusing leave to file the cross claim, with the result that the discretion had miscarried. It was argued that his Honour was bound by the approach of the High Court in The State of Queensland & Anor v JL Holdings Pty Ltd (1997) 189 CLR 146, as made clear by the Court of Appeal in Ainsworth v Burden [2005] NSWCA 174 (at [56] - [58]); Makucha v Brian Tucker & Associates Pty Ltd [2005] NSWCA 397 and Dennis v Australian Broadcasting Corporation [2008] NSWCA 37. 9 The result was that the efficiency of court procedures was erroneously permitted to prevail over the injustice of shutting the first defendant out of litigating the real issues in question between the parties, including the amount of the rent due. That issue was squarely raised in the defence, although not there particularised. Those particulars were provided in the cross claim. If they needed to be set out in the defence, the proper exercise of the discretion would have involved a direction being given for the amendment of the defence, rather than dismissing the motion to permit the cross claim. Leave to so amend the defence was pressed on appeal. In any event the cross claim also raised other matters, which could only be raised by cross claim and not by the defence. 10 It was argued that his Honour had, in reality, erected a new test, inconsistent with both the Civil Procedure Act 2005, and binding authorities, which imposed an onus on the first defendant to explain the delay in filing the cross claim and that explanation not being regarded as satisfactory, shutting out the first defendant from arguing its real defence and the matters sought to be raised by way of cross claim, even though no hearing date had yet been fixed for the issues remaining between the parties to be determined. While delay was a matter to which regard could be paid under the Civil Procedure Act, it was but one factor to be considered, not itself a determinative one. 11 It was also argued that his Honour had fallen into other errors, The view expressed that the filing of the cross claim would result in delay was not open, no trial date having been set and no evidence as to delay being led. It followed that there was no basis for concluding that to permit the filing of the cross claim would delay any hearing, given that as a matter of case management, the Court could give necessary directions to ensure that the hearing which would be fixed in the ordinary course, if there had been no application for leave to file a cross claim, could be adhered to. 12 His Honour also fell into error in 'musing' that the defendant might be impecunious and that the purpose of filing the cross claim was to cause further delay. This amounted to a conclusion as to an abuse of the Court's process, for which there was also no evidence. 13 His Honour had also accepted the plaintiff's submission that it was incurring costs of $19,000 per month, as a result of the defendant's earlier failures to comply with the Court's orders and directions. There was no evidence led about such losses, which could only have flowed from the plaintiff not having achieved possession. A writ had been issued and possession was achieved in October. Such costs cannot have been associated with the defence and cross claim which the first defendant sought to argue. 14 His Honour also erred in concluding that the first defendant had any onus to satisfy the Court as to an entitlement to the relief it wished to pursue in the proceedings. The proper approach was that it was entitled to put any fairly arguable case to the Court and would be permitted to amend its case accordingly, unless the plaintiffs would be caused prejudice, which could not be cured by a costs order. 15 It was also argued that the costs orders made were perverse, his Honour having reserved the costs order in relation to the plaintiffs' unsuccessful motion, while ordering costs in favour of the plaintiffs, in relation to the first defendant's unsuccessful motion. Costs should have followed the event in both cases. 16 The plaintiff's case was that not only had Malpass AsJ applied the correct test for the exercise of the discretion in question, no error had occurred in its exercise and the relief sought was not available, given the nature of an appeal such as this. 17 Under the Rules the cross claim had to be filed by 2 May, the time by which a defence had to be filed. The defence was not filed until 5 May and the cross claim was only filed in court on 7 August, when the plaintiffs' motion for summary judgment was listed for hearing. It followed that there had been considerable delay, as well as a litany of other failures by the first defendant to adhere to the Court's orders and directions. This did not involve merely a late amendment to pleadings, but an adjournment of the hearing of the matter. 18 In exercising his discretion, Malpass AsJ was obliged to have regard to the Civil Procedure Act, particularly s 56, s 57,s 58, s 59 and s 61. The High Court's approach in JL Holdings was now a 'less than binding authority', given the enactment of the Civil Procedure Act. (See Kim v Lee & Ors (No 3) [2006] NSWSC 1213 at [8] and State of New South Wales v Mulcahy [2006] NSWCA 303 at [25] - [30]). His Honour had not erred in the approach adopted. 19 It was also relevant that unlike the circumstances in JL Holdings, there was no application here to amend the defence, but rather to put on a new cross claim which conflicted with the existing defence, filed after a date for hearing of an application for summary judgment had been fixed. The cross claim raised complex new issues of fact which would substantially alter the nature of the proceedings, the evidence and the length of any hearing, in circumstances where a timetable fixed in June 2008 for putting on evidence had expired, without any evidence being put on by the defendant. 20 The consequences of the first defendant's conduct of the case had to be considered, as discussed by Kirby J in JL Holdings. Here the defendant was in repeated default of the Court's orders. Parties to civil proceedings have a duty to assist the Court to achieve the overriding purpose provided for in s 56 and failure to do so could properly be taken into account, as his Honour did, when a discretion was sought to be exercised in a party's favour. 21 The onus fell on the first defendant as the party seeking the Court's indulgence. It failed in its obligation to explain its failures. The plaintiffs had, in any event, demonstrated prejudice, pointing to the course which the proceedings had taken and the various defaults on the first defendant's part, in complying with the Court's orders. These matters were all properly taken into account. The orders, including the costs order, were properly available as a matter of discretion and would not be disturbed.

Was error shown? 22 Malpass AsJ did not refer to the provisions of the Civil Procedure Act which bound the exercise of the discretion to permit the filing of a cross claim out of time. Nor did he give any detailed consideration of the authorities relevant to the exercise of the discretion in question. Undoubtedly, however, his Honour had these things in mind, given the reasons which he expressed for the conclusions to which he came. 23 The first defendant accepted that in so far as its cross claim is inconsistent with its defence, the defence should be amended and seeks leave to do so. It has written to the plaintiffs on the basis that in part, the cross claim provides particulars of its defence and has advanced that argument on appeal. Even so, there is no question that such particulars should have been provided earlier, when particulars were sought. It is apparent from this state of affairs that the better course for the first defendant to have taken would have been to seek to amend its defence, rather than simply filing a cross claim. In reality, it needed to take both steps, given the three aspects of the cross claim, not all of which concern matters already raised in the defence. In any event, it is apparent that the step of filing that cross claim was taken considerably out of time, given the requirements of the Rules. 24 His Honour rightly took the view that the explanation advanced for the delay was not a very satisfactory one - essentially that Mr Lowe, instructed by the first defendant on 30 May and thus not the author of the defence, had difficulties in obtaining instructions, for various reasons. The evidence suggested a lack of sufficient attention being paid to the matter by the first defendant, inconsistent with its obligations under the Civil Procedure Act. 25 That was, undoubtedly, a proper matter for his Honour to have taken into account, in considering the first defendant's application for leave, as were the plaintiffs' complaints as to the defendants' approach otherwise to the proceedings and the Court's orders. 26 Nevertheless, what did not feature in his Honour's consideration of the application was the nature of the case which the first defendant wishes to advance and the consequences of shutting the first defendant out from doing so. 27 In the defence filed, it is claimed that 'there is a genuine dispute between the parties as to the amount of the lease that was payable pursuant to the lease as amended' and that the plaintiff's 'by their conduct have waived' the breach of the lease and are estopped from relying on it. The plaintiffs sought, but were not provided with particulars of the defence, at least until the cross claim was filed in August. 28 Amongst other things, in the cross claim, the first defendant raises verbal agreements as to the amount of rent to be paid, having regard to a water bore on the property not being operational from a particular date. This is claimed to amount to an amendment to the lease, or collateral to it. The cross claim also raises two other issues. The first, the plaintiffs' breach of an agreement to install a bore, pleaded in the alternate as a Trade Practices/Fair Trading claim and the second, a claim that the plaintiffs had breached various of their obligations, with the result that the defendant were relieved from compliance with its obligations, a claim it was submitted the first defendant was permitted to bring as a set-off, under s 21 of the Civil Procedure Act. 29 His Honour took the view that the cross claim was inconsistent with the defence. That view, it seems to me, was open. Nevertheless, while the cross claim raises matters which ought to have been dealt with in the defence, it also raises issues which had to be advanced by cross claim. They undoubtedly raise issues more complex than the issues presently raised in the proceedings, as the plaintiffs complain. If leave were granted, that would require a defence, additional evidence and hearing time. The estimate is that instead of one day, the case would then take up to two to hear. 30 The Civil Procedure Act contemplates in s 62 that an amendment to a defence might be permitted at any time and that subject to s 58, all necessary amendments are to be made for the purpose of determining the real questions raised by or otherwise depending on the proceedings, correcting any defect or error in the proceedings and avoiding multiplicity of proceedings. Sections 21 and 22, which deal with set-offs and cross claims, also seek to avoid multiplicity of proceedings. 31 Permitting the cross claim would certainly assist in achieving the aim of avoiding multiplicity of proceedings in relation to matters flowing from these parties' dealings with each other. Refusing the leave sought did not shut the first defendant out from advancing its other claims, in separate proceedings. A cross claim is not a mandatory way in which to bring a claim which a defendant has against a plaintiff, but rather a mechanism designed to bring all claims lying between the same parties to a conclusion, especially those arising out of the same course of dealings. 32 Section 58 is concerned to ensure that in making any order for the management of the proceedings, including permitting a procedural step, such as filing a cross claim out of time, the Court 'seeks to act in accordance with the dictates of justice'. In so doing, the Court must have regard to the provisions of s 56 and s 57 of the Civil Procedure Act. This raises the parties' conduct and approach to the proceedings, in various specified ways, as well as the overriding purpose of the Civil Procedure Act, specified in s 56 as the 'just, quick and cheap resolution of the real issues in the proceedings'. 33 It is on this basis that Malpass AsJ was entitled to have regard to the first defendant's conduct and obvious failures to act in strict accordance with the obligations imposed upon it by the Civil Procedure Act and the Court's orders and directions. I agree with his Honour that there was an onus on the first defendant to explain that situation. The first defendant took the opportunity to do so, but his Honour took a dim view of the explanation advanced, understandably, it seems to me in the circumstances. 34 The first defendant accepts its failures, but complains nevertheless, that his Honour erred, not only in the approach adopted, but in conclusions reached without any evidentiary basis for them having been established. It has to be accepted that there is some force in these complaints. 35 In exercising the discretion, what also needed to be weighed in the balance was whether refusal of the leave sought, would ensure that the overriding purpose of the Civil Procedure Act was achieved in these proceedings. In coming to that conclusion, consideration had to be given to the fact that refusal of the leave sought effectively precludes the first defendant from advancing a defence of the money orders sought against it by the plaintiffs, having regard to what it claims the parties in truth agreed as to the rent, because of problems with a water bore and the parties' agreement that the plaintiffs would install a new one. 36 Undoubtedly, the cheaper course was to refuse the leave sought, as his Honour did, at the least in the short term. If the defendants took separate proceedings against the plaintiffs, that may not have been the end result. In all likelihood refusing the leave would also have been the quicker course, but for this appeal, so far as the plaintiffs' claim for rent, money due under a cow lease and mesne profits were concerned. To be weighed against that consideration, as the defendant argued, was that had the leave then sought been granted, steps could have been taken by way of case management, to reduce any resulting delay. The plaintiffs' stated intention to seek an order against the defendant for security for costs, would appear to have made that difficult, but that is not a matter which lies in the first defendant's hands. 37 In any event, whether the refusal of the leave sought could have achieved a just result between these parties, having regard both to their respective conduct and what the defendant seeks to argue as to the real issues lying between the parties, as to the claims which the plaintiffs had brought before the Court and the other seemingly related claims, which the defendant says it has against the plaintiff, also needed consideration. 38 It is here, it seems to me, that the real error into which his Honour fell, is revealed. That aspect of what fell to be considered under the Civil Procedure Act, does not seem to have been given attention by his Honour.

The High Court decision in JL Holdings and the Civil Procedure Act 39 The parties made extensive reference to the authorities which have considered the approach of the High Court in JL Holdings in light of the subsequently enacted provision of the Civil Procedure Act. There the High Court was concerned with proceedings before the Federal Court, not New South Wales proceedings, which were even then governed by Rules which prescribed that the overriding purpose of the Rules, in civil proceedings was 'the just, quick and cheap resolution of the real issues in such proceedings'. (Part 1 Rule 3(1)). 40 The High Court accepted that 'the contemporary approach to court administration has introduced another element into the equation, or more accurately, has put another consideration onto the scales' (at 636). Yet it drew attention to the views of Bowen AJ in Cropper v Smith (1884) 26 Ch 700 at 710, which included that:

"Now, I think it is a well established principle that the object of Courts is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases by deciding otherwise than in accordance with their rights. Speaking for myself, and in conformity with what I have heard laid down by the other division of the Court of Appeal and by myself as a member of it, I know of no kind of error or mistake which, if not fraudulent or intended to overreach, the Court ought not to correct, if it can be done without injustice to the other party. Courts do not exist for the sake of discipline, but for the sake of deciding matters in controversy, and I do not regard such amendment as a matter of favour or of grace."

41 The High Court also drew attention to its judgment in Clough and Rogers v Frog (1974) 48 ALJR 481; 4 ALR 615 at 618:

"As the defence, if established, would be a complete answer in either action, the amendments sought should have been allowed unless it appeared that injustice would thereby have been occasioned to the respondent, there being nothing to suggest fraud or improper concealment of the defence on the part of the appellants. With the exception of the suggestion of prejudice arising in respect of the loss of the possible claim against the nominal defendant, the matters relied upon by the respondent in opposition to the amendment sought go at the most to delay and irregularity only, matters which are relevant to costs but do not constitute injustice to the respondent in the sense in which that expression is used."

42 The High Court went on to refer to a passage from the judgment of Toohey and Gaudron JJ in Sali v SPC Ltd (1993) 67 ALJR 841 at 849; 116 ALR 625 at 636, where their Honours said: "The contemporary approach to court administration has introduced another element into the equation or, more accurately, has put another consideration onto the scales [See GSA Industries Pty Ltd v NT Gas Ltd (1990) 24 NSWLR 710. For the implications of this aspect for the amendment of pleadings, see Ketteman v Hansel Properties Lt d [1987] AC 189; The Commonwealth v Verwayen [1990] HCA 63; (1990) 170 CLR 394.]. The 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 are pressing concerns to which a court may have regard."

The majority concluded: "Unless we are to mouth the repeated cautions about discretionary judgments, case management, efficiency, practice and procedure, and the advantages of the managing judge, only to ignore them when it comes to the crunch, this appeal must be dismissed." 43 The High Court's observations were followed in New South Wales, with the Court of Appeal in cases such as Ainsworth v Burden [2005] NSWCA 174, taking the view for example, where a plaintiff had made a late application to amend, that a heavy onus fell on him to show that the defendant was not prejudiced in a way which could not be compensated by a costs order and that neither delay, or the efficiency of court procedures or case management, was in itself or in combination, an answer to the application (at [58]). There it was concluded that efficiency of court procedures had been erroneously permitted to prevail over the injustice caused by the plaintiff from litigating the issues in question. 44 In Mulcahy, the Court of Appeal then considered the High Court's observations in JL Holdings, in light of the enactment of the Civil Procedure Act, in circumstances where the plaintiff had been granted the right to file a third amended statement of claim which raised complex issues, some two years after the proceedings had been commenced and one month before the hearing was due to commence. In dismissing the appeal, the Court paid regard to the attention directed by s 64 of the Civil Procedure Act, to 'ascertaining what are the real questions raised by or otherwise depending on the proceedings' (at [30]). 45 More recently in Dennis, the Court of Appeal had to consider a plaintiff's attempt, in defamation proceedings, to amend his claim for a fifth time. The Chief Justice observed at [28] - [29] that:

28 The respondent invoked the authority of Queensland v J L Holdings Pty Ltd [1997] HCA 1; (1997) 189 CLR 146 in support of its ability to amend, even for the fifth time. Case management practices in all Australian courts have changed significantly in the decade since that judgment. Although it remains binding authority with respect to the applicable common law principles, the circumstances of the case were significantly different from those in the present case and do not dictate its outcome. In any event, such principles can be, and have been, modified by statute both directly and via the statutory authority for Rules of Court.

29 In this State J L Holdings must now be understood as operating subject to the statutory duty imposed upon the courts by s 56(2) of the Civil Procedure Act 2005, which requires the Court in mandatory terms - "must seek" - to give effect to the overriding purpose - to "facilitate the just, quick and cheap resolution of the real issues in the proceedings" - when exercising any power under the Act or Rules. That duty constitutes a significant qualification of the power to grant leave to amend a pleading under s 64 of the Civil Procedure Act .

46 Numerous decisions of single members of the Court, resolving such questions, were also referred to by the parties in argument. What they each reveal is the necessity of ensuring not only that the real issues in the proceedings are quickly and cheaply resolved, but that they are justly resolved. This involves a balancing exercise, which, in my view, his Honour failed to undertake.

Should the leave sought be granted? 47 It is those two aspects of the provisions of s 56, which here arose for consideration which were not given attention by his Honour. Would refusal of the leave sought result in the real issues in the proceedings not being brought before the Court, as the first defendant argued, and would the Court then truly be in a position where it could justly resolve those issues between the parties? 48 It seems to me that this is the real difficulty with the case advanced for the plaintiffs. Here, the leave to bring the cross claim was sought at a point where the plaintiffs had sought summary judgment in their favour. That application did not succeed and has been deferred for consideration at trial, but no hearing date has yet been fixed. If the leave sought is not granted, not only will the first defendant be shut out of putting what it claims are the real issues lying between the parties as to the matters raised in the plaintiffs' case, the result will also be that the other matters clearly lying between these parties, which have an obvious relationship with what is already before the Court, arising as they do out of the same course of dealings between them, will also not be before the Court in the one proceedings. That is neither a just, nor efficient outcome. 49 Nevertheless, as was argued for the plaintiffs, the first defendant certainly had the onus to convince the Court that the leave it sought should be granted. That was an onus which it had to meet, in the face of past failures to comply with the Court's procedures and orders and in a way which ensured that justice was done as between both parties, not just the defendants. In seeking to meet that onus, the defendant had put on its evidence and said it could take a date. Plainly, if the leave were granted, the plaintiffs were not in the same position, and so further delay has to be considered. 50 While the defendants' past failures have to be weighed in the balance, its conduct otherwise also has to be considered. That conduct included that the question of possession was finally resolved between the parties by consent in July 2007, albeit possession was not given until a writ was issued and executed. At the hearing below, the first defendant made two concessions also relevant to be considered in determining the leave being sought. The first, that the lease, whatever its terms, had been breached by it. The second, that the lease had come to an end on 31 August 2007. Those concessions limited the matters requiring the Court's determination at a hearing. On appeal the first defendant also accepted that if its appeal was successful, a costs order would be made in favour of the plaintiffs, as to costs thrown away as a result of the leave being granted. 51 Having considered all of these matters, it seems to me that it has to be accepted that a decision to preclude this defendant from arguing a cross claim which raises matters averted to, but not particularised in the original defence, namely a contest as to the true terms of the parties' lease, would not be readily reached, when the first defendant seeks to bring the particulars forward in a pleading before a trial has been fixed, albeit the method chosen was a cross claim, rather than an amended defence. That the cross claim also seeks to raise other related claims which the first defendant has against the plaintiffs, cannot justly result in a different view being reached. Undoubtedly, that cross claim came forward late, but it has come before a hearing date as to what is owed to the plaintiffs has been fixed, the plaintiffs' application for summary judgment having not yet succeeded. 52 Taking steps before that hearing which will result in all issues lying between these parties as a result of the lease of this property and the parties' other dealings with each other being determined in the one proceedings, is consistent with the overriding purpose of the Civil Procedure Act and is not, as was argued for the plaintiffs to simply permit a non compliant party to come late to Court seeking an indulgence, without any adequate explanation of delay. This was not one of those cases considered in various of the authorities, where the defendant has sought 'multiple repeated opportunities' to present its case. While there has undoubtedly been default, there has also been concession and consent. (See the discussion of White J in Thiele v Radford [2008] NSWSC 1162 at [23] - [35]). The balancing exercise required by the Civil Procedure Act in all of these circumstances, requires the granting of the leave sought, so that all of the issues lying between the parties may be resolved by the Court in these proceedings.

Costs 53 As to costs, they should follow the event, in the ordinary way. This means that the plaintiffs must bear the costs of the hearing of the first defendant's motion, as well as the costs of the appeal. 54 As to the costs of the plaintiffs' motion for summary judgment, which has not been dismissed, but stood over to be dealt with at trial, I accept the plaintiffs' submission that it may not properly be interfered with. While the defendants complain about the order adjourning that motion, which does seem to have been a curious one, neither party has appealed that aspect of his Honour's decision. It followed that the ordinary rule, that costs should follow the event, could not be applied at that point, the motion not having been disposed of. The question of the costs of the adjourned motion remains to be dealt with at trial.

(2) The leave sought to file the cross claim, together with an amended defence, consistent with the terms of that cross claim, be granted. That amended defence to be filed within seven days.

(3) The plaintiffs are to pay the first defendant's costs of the appeal and the hearing below.

(4) The first defendant is to pay the plaintiffs' costs thrown away as a result of the granting of the leave. **********

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.

At a glance

Court

Decision date

Before

Source

Judgment (32 paragraphs)

Parties

Cases Cited (15)

Cited By (2)