Calcifer Industrial Minerals Pty Ltd v Daraleigh Pty Ltd as Trustee for the DC & ML Dillon Trust [2010] QLC 115

1 LAND COURT OF QUEENSLAND CITATION: Calcifer Industrial Minerals Pty Ltd v. Daraleigh Pty Ltd as Trustee for the DC & ML Dillon Trust [2010] QLC 115 PARTIES: Calcifer Industrial Minerals Pty Ltd (applicants) v. Daraleigh Pty Ltd as Trustee for the DC & ML Dillon Trust (respondents) FILE NO: MRA 138-09 DIVISION: Land Court of Queensland PROCEEDING: Application DELIVERED ON: 10 August 2010 DELIVERED AT: Brisbane HEARD AT: Brisbane MEMBER: His Honour, WL Cochrane ORDER: 1. Accordingly, having given consideration all the matters set out above I dismiss the application to dismiss the proceedings. 2. Accordingly, I further order that the applicant Calcifer Industrial Minerals Pty Ltd is to file and serve all expert reports, statements, affidavits and other material it intends to rely on, on or before 4pm on the 30th of August 2010. 3. The matter will be mentioned again at 9am on 31 August 2010. CATCHWORDS: Compensation - Mineral Resources Act – dismissal of proceedings – Land Court Rule 14 – prejudice - costs -- 1 of 10 -- 2 APPEARANCES: Mr R Lilley SC for the Applicants instructed by MacDonnells Lawyers. Mr C Wilson for the Respondents instructed by Vandeleur & Todd. [1] This is an application brought by Daraleigh Pty Ltd (“Daraleigh”) the respondent in which it seeks the following orders:- 1. The proceeding be dismissed. 2. The applicant pay the respondents costs of the proceeding including reserved costs, to be fixed or assessed. 3. The basis for the application dismissing the whole proceeding is that the applicant Calcifer Industrial Minerals Pty Ltd (“Calcifer”) has repeatedly failed to comply with orders of the Court. 4. In particular as transpired at the hearing of this matter they have failed to provide any expert reports as required by orders of this Court. 5. In support of its application Daraleigh, represented by Mr C Wilson of counsel relied upon the following material:- a) Application filed 26 July 2010; b) Affidavit of Christopher Paul Kahler sworn 26 July 2010; c) Further affidavit of Christopher Paul Kahler sworn 2 August 2010; d) Second further affidavit of Christopher Paul Kahler sworn 2 August 2010; e) Affidavit of Philip Dowling sworn 22 July 2010; [2] Mr Lilley of Senior Counsel who represented Calcifer Industrial Minerals Pty Ltd sought the Court’s leave on the morning of hearing to file and to read an affidavit of Roger Thomas May sworn 4 August 2010 and an affidavit of Cameron Ian MacKenzie sworn 5 August 2010. There being no objection leave was granted. [3] The failure by Calcifer to comply with orders of the Court has been prolonged and is serious. [4] Mr Wilson drew the Court’s attention to orders which were made on the 16th December 2009, 23rd February 2010, 6th April 2010, and 25th May 2010. -- 2 of 10 -- 3 [5] All of those orders contained requirements for Calcifer to file and serve experts reports, statements, affidavits, and other materials. The various dates which were the subject of those orders were 26th February 2010 (the order of 16 December 2009), 19th March 2010 (the order of 23rd February 2010), 30th April 2010 (the order of 6th April 2010) and finally by 22nd June 2010 (the order made 25th May 2010). [6] No material has been filed by the applicant in response to these orders. Accordingly, the failures are serious and have a considerable impact on the ability of the ability of the Court to make a determination in this matter which is an application filed on the 6th April 2009 for a determination of compensation in respect of what is described as the Mourilyan Sands Project on ML20378. The notice from the Mining Registrar to the Land Court was dated 5 March 2009. Accordingly, it is a matter which has loitered around for in excess of a year. [7] It should be observed that Daraleigh Pty Ltd has generally been “punctilious” in its compliance with the orders of the Court and extensive reports from various experts and affidavits from Mr Dillon, the principal of Daraleigh Pty Ltd are presently on the Court file. [8] It should also be noted that the whole matter has an element of volatility about it insofar as allegations and counter allegations of offers of compensation and agreements about an amount have been made by both sides. [9] Prior to argument in this matter proceeding with Mr Lilley instructed by MacDonnells Lawyers I had granted leave to DLA Phillips Fox to withdraw from the record of solicitors consequent upon an affidavit being sworn by Mr Dowling that he had been unable to obtain instructions from Calcifer. [10] Submissions made by Mr Lilley make it clear that there is a dispute between Calcifer and DLA Phillips Fox relating to fees and also some dissatisfaction has been expressed by Calcifer with respect to the performance of DLA Phillips Fox. Those are not matters which concern the present application but do provide a background to the abject failure by Calcifer to comply with the orders of the Court. [11] It is pointed out that they are background only because Mr Lilley of Senior Counsel for Calcifer frankly conceded that he was unable to provide any explanation for the failure of Calcifer to comply with Court orders. The -- 3 of 10 -- 4 failure remains unexplained, save that in an affidavit sworn by the present principal advisor of the applicant Mr Roger May he deposes to Calcifer having obtained a draft expert report which had been subject to some criticism on the basis that the author expert “may not have considered all matters necessary to the applicant’s application”. (Affidavit of May para 4). There has been no suggestion of any other experts or other witnesses being relied upon by Calcifer. [12] It should be observed that the affidavit of May itself is not a particularly impressive document. He deposes to being a “Principal Advisor” of the Applicant PA&A” and having authority to swear the affidavit but does not depose to being an officer of the applicant and nor does he depose to direct knowledge and merely a familiarity with the books and records of the applicant. [13] Also, he fails to identify the expert who is apparently engaged by Calcifer for the purposes of this matter. There is a glaring inconsistency between correspondence provided by the previous solicitors DLA Phillips Fox to the solicitors acting for Daraleigh and what is said by Mr May in his affidavit. [14] In a letter dated 23rd June 2010, DLA Phillips Fox advised Vandeleur and Todd solicitors for Daraleigh that “we are instructed that our client has been liaising with its expert to finalise the report, but there has been some delay occasioned by the principal of the client being overseas”. [15] Notably the affidavit of May makes no reference to any liaising with the expert to finalise a report nor does it make any mention of the absence overseas of the unnamed principal of Calcifer Industrial Minerals Pty Ltd. [16] The conduct of Calcifer is far from satisfactory. [17] Extensive written submissions were provided to the Court by Mr Wilson. In his written outline of submissions which the Court has found very useful, Mr Wilson of counsel referred to the decision of His Honour P Lyons J in Field v Luxor Products Pty Ltd.1 In that decision His Honour P Lyons J referred to Quinlan v Rothwell.2 [18] The Quinlan v Rothwell decision contains a number of observations apposite to the present circumstances. Those observations include: “[4] I at once observe that the discretion to dismiss for want of prosecution may these days confidently be exercised, in 1 2009 QSC 218. 2 2002 1QdR 647, 2001 QCA 171. -- 4 of 10 -- 5 appropriate cases, with more robustness than would previously have been considered appropriate. Brisbane South Regional Health Authority v Taylor (1996) 186 C.L.R. 541, 551-552 jurisprudentially signalled that shift, and it is legislatively suggested through the Uniform Civil Procedure Rules. The focus of r. 5 rests strongly on ‘the just and expeditious resolution of the real issues … at a minimum of expense’, and avoiding undue delay, expense and technicality. The rule has gone to the length of expressly confirming that breach of a party’s ‘implied undertaking’ ‘to proceed in an expeditious way’ may attract sanctions including, as per the proffered example, dismissal of the proceeding.” (per de Jersey C.J.) [19] In a similar vein, Thomas JA observed “[24] There is a distinction between the setting aside of a proceeding for a specific non-compliance and a dismissal for want of prosecution. The dismissal of an action or proceeding because of non-compliance with a rule or a court direction has long been authorised by particular rules of court, as has the power to set aside proceedings, such as that recognised in the former Order 93 rule 17. The powers of dismissal for abuse of process and for want of prosecution have generally been regarded as recognition of a wider inherent power.3 In an appropriate case a guillotine order might be made with the objective of providing a recalcitrant party with added incentive to comply with directions, although some restraint was thought desirable in the peremptory making of such an order when a party might be in difficulty in performing within the prescribed time, or when the issues were not clear cut.6 Repeated non-compliance with the rules or directions thereunder was sometimes regarded as evidence of “contumelious disregard”7 of the rules and therefore as relevant to the exercise of a court's discretion to dismiss for want of prosecution or to excuse delay.” [28] It is a noteworthy feature of recent cases that courts appear more ready than before to infer that substantial delays will substantially reduce the chance of a fair trial. Such an approach has no doubt been influenced by the eloquent statement of McHugh J in Brisbane South Regional Health Authority v Taylor4 concerning the prejudice that delay produces whether or not the actual prejudice can be clearly articulated. The present approach has also been influenced, I think, by a change in attitude which is reflected in and encouraged by the additional provisions now contained in the Uniform Civil Procedure Rules. Recently Gleeson CJ expressed, in an out of court statement, his perception of what I understand to have been referred to in Cooper v Hopgood & Ganim5 as a change in attitude since Birkett v James: “The pressure of business before the courts, and the necessity to respond to demands for judicial involvement in case management, has resulted in the acceptance by judges of responsibilities of a kind their predecessors never acknowledged. Forty, and even fifteen, years ago, it was not regarded as part of the role of a judge to manage the progress of cases towards readiness for trial, and judges were discouraged from undue intervention in the progress of cases during trial. As a rule, it was up to the parties and their lawyers to prepare cases for hearing, in such manner, and at such speed, as they desired. Interlocutory proceedings were available if one party 3 Williams v Zupps Motors Pty Ltd [1990] 2 Qd R 493, 494, 498. 4 (1996) 186 CLR 541, 551-552. 5 Op cit at p 117 per Pincus JA quoting Lord Wolff. -- 5 of 10 -- 6 sought judicial intervention for a special purpose. But, ordinarily, the role of a judge was to deal with cases once they had reached the head of a queue. And in dealing with a case which came on for trial, the judge assumed a relatively passive role. Things are different now. Courts are expected to manage their lists actively, and trial judges are expected to adopt a role most of their predecessors would have regarded as inappropriately interventionist.”6 [29] There is now a consciousness of the need for some level of efficiency in the use of the courts as a public resource. That, of course, must not displace the need for reasonable access to the courts and the provision of justice according to law in each matter, but it highlights the fact that the former laissez faire attitude by courts towards the leisurely conduct of actions at the will of the parties has ended. At the same time the rules of court are not an end in themselves. They do not exist for the discipline of practitioners or clients, or for the protection of courts from inefficient litigants, but rather as a means of ensuring that issues will be defined in an orderly way and that parties have the opportunity of full preparation of their case before the trial commences. The rules also afford defendants the means of bringing to an end actions in which the other party will not abide by the rules. The present respondents, like the appellant, appear to have been content over very lengthy periods to allow the action to go to sleep. [30] On my reading, the combination of rules 5, 280 and 371 of the UCPR re-affirm the Supreme Court's longstanding powers of dismissal. Now the powers expressly mentioned in those rules have also been conferred on the District Court and Magistrates Court.7 Although this court's inherent power remains, these rules are a sufficient starting point in the determination of such applications. Rule 280 is an express and untrammelled statement of the power of all three courts in Queensland to dismiss a proceeding for want of prosecution. Subject to what is said below, the wide-ranging factors that have been identified as potentially relevant to such applications, such as those mentioned in Cooper v Hopgood & Ganim, will continue to guide courts in exercising the power. In addition, rule 5 gives express recognition to the importance of expeditious resolution of issues in proceedings. In my view the nature of the power of this court has not been altered, but the rules are a clear indication of the change in attitude that has independently taken place in courts throughout Australia. They suggest that courts will now be less tolerant of delay and that the expedition of proceedings should be encouraged to a greater extent than was formerly the case.” [20] In the Field v Luxor decision His Honour dismissed an action for want of prosecution in circumstances where there had been a repeated failure by a plaintiff seeking damages arising out of a contractual relationship. That case like the present, was characterised by an absence of any proper explanation for the delay. Ultimately, it seemed to descend to a contention 6 Gleeson , “A Changing Judiciary”, a paper delivered to the Judicial Conference of Australia, Uluru, 7 April 2001. 7 Cf rule 3 of the UCPR. -- 6 of 10 -- 7 that the matter was complex and more time was required than expected. This was overlayed upon other difficulties in the solicitor’s office. [21] His Honour P Lyons J observed (para 38): “[38]It has long been 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.”8 To similar effect, in Queensland v J L Holdings Pty Ltd,9 in respect of an application to amend a defence, Dawson, Gaurdron and McHugh JJ said:10 ‘Justice is the paramount consideration in determining an application such as the one in question. Save in so far as costs may be awarded against the party seeking the amendment, such an application is not the occasion for the punishment of a party for its mistake or for its delay in making the application. Case management, involving as it does the efficiency of procedures of the court, was in this case a relevant consideration. But it should not have been allowed to prevail over the injustice of shutting the applicants out from raising an arguable defence, thus precluding the determination of an issue between the parties.’” [22] Later having referred to a number of cases including Mango Boulevard Pty Ltd v Spencer & Ors,11 Cooper v Hopgood & Ganim12 and Quinlan v Rothwell & Anor13 His Honour observed that rules now permitting the striking out and/or dismissal of proceedings were “a clear indication of a change of attitude that has taken place in Courts throughout Australia”.14 [23] Having considered the facts of that case, His Honour observed: [58] In my view, against the background of the case-flow management regime which I have mentioned, the repeated and persistent failures by the plaintiff to comply with orders of the Court, supported by explanations which lack credibility, and where the plaintiff is not prepared to commit to a trial until an indefinite time after November this year, the plaintiff’s conduct is in a category which to me seems comparable to intentional and contumelious default. If the test from Birkett v James were to be applied, it would result in the dismissal of the plaintiff’s claim. However, its authority in some contexts has been doubted.” And later at para 61 His Honour observed: “[61]As mentioned, in Cooper, the Court of Appeal took the view that the discretion was a broad one, and that a number of factors are potentially relevant to its exercise. Atkinson J, when a member of the Court of Appeal in Tyler v Custom Credit Corp Ltd & Ors15 8 Cropper v Smith (1884) 26 Ch D 700, 710, cited recently by Daubney J in Dick v Alan Powell Holdings [2008] QSC 219 at [20]. 9 (1997) 189 CLR 146. 10 At page 155. 11 [2008] QCA 274. 12 [199] QdR 113. 13 Ibid. 14 Para 51. 15 [2000] QCA 178. -- 7 of 10 -- 8 and again in Arc Holdings Pty Ltd v Riana Pty Ltd and Another16 identified a number of such factors. Some of these will be mentioned briefly.” [24] The decision of Atkinson J in the Tyler v Custom Credit Corporation case17 has been extensively referred to in a number of Courts and decisions. As P Lyons J pointed out (para 63) in the Field v Luxor decision one of the factors referred to in Tyler was whether the litigation between the parties would be concluded by striking out the plaintiffs claim. [25] In that case His Honour was concerned about whether the struck out plaintiff would be able to institute fresh proceedings. His Honour was uncertain about that but in any event he was still minded to strike out the proceedings. [26] In the present case, striking out the proceedings of Calcifer will not have the effect of concluding the litigation. [27] This is an application begun by referral from the Mining Registrar and accordingly even absent any input from Calcifer it remains necessary for the Court to embark upon a determination of the appropriate compensation in respect of mining lease ML20378 for a project referred to as the Mourilyan Sands Project. [28] Dismissal of any part of the proceedings does not relieve the Court from the obligation to embark upon that determination. [29] All of the material filed by Daraleigh goes to the issue of compensation. [30] It appears clear to me that the Court would be assisted by the presence of a proper contradictor who might forensically cross examine on the matters contended for by Daraleigh in their expert and other material. [31] Similarly, accepting that the main function of this Court is to do justice between the parties in the determination of the appropriate amount of compensation it seems reasonable that Calcifer, having now apparently got their house in order by engaging fresh solicitors, should be given some limited further opportunity to place expert evidence before the Court in support of its contentions with respect to compensation. [32] In the Field v Luxor decision His Honour also referred to the consideration of whether any part of the failure to comply with Court orders was attributable to the conduct of the parties’ lawyers. In this case it is not 16 [2008] QSC 191. 17 [2000] QCA 178. -- 8 of 10 -- 9 clear that the lawyers engaged by Calcifer are blameworthy although that appears to be the inference from the relatively unsatisfactory affidavit of Mr May. [33] It is also relevant that refusing the application brought by Daraleigh will not in any practical sense slow down the rate at which the matter will be determined in the future and cause prejudice in that way. [34] The order made in April vacated an earlier order setting the matter down for hearing in April this year and no fresh date has been allocated for the hearing of this matter. It is unlikely to come on for hearing before late this year whether Calcifer is a participant or not. [35] Accordingly, having given consideration all the matters set out above I dismiss the application to dismiss the proceedings. [36] Mr Lilley contended in his submissions, as I understood them, that there was no power in the Court in any event to dismiss the proceedings which he characterised as being of an administrative nature. I do not need, in the circumstances, and having regard to the reasons articulated above for dismissing the application, to determine that issue at this time. [37] While I dismiss the application I am not prepared to allow Calcifer an unlimited period of time in which to comply with the orders which have been previously made. [38] If, as the Court has been informed, a draft report exists requiring only amendment to cover all of the relevant aspects of Calcifer’s case I do not see any reason for granting them a long period of time to place such material as they propose to before the Court. [39] Accordingly, I further order that the applicant Calcifer Industrial Minerals Pty Ltd is to file and serve all expert reports, statements, affidavits and other material it intends to rely on, on or before 4pm on the 30th of August 2010. [40] The matter will be mentioned again at 9am on 31 August 2010. [41] If Calcifer has not, by that time, filed all of its material then I shall invite Mr Wilson to remake his application for dismissal of Calcifer as a party to the proceedings. [42] I will hear the parties on the question of costs. At this stage I should advise the parties that I see no reason why costs should follow the event. I am strongly disinclined to order that Calcifer’s costs should be paid by -- 9 of 10 -- 10 Daraleigh. I am willing to entertain submissions as to whether some costs order should be made against Calcifer. HIS HONOUR, WL COCHRANE MEMBER OF THE LAND COURT -- 10 of 10 --