Arkaroola Pty Ltd v Niugini Mining (Australia) Pty Ltd [2001] QSC 410

' . ' (~ Queensland Governn1ent State Reporting Bureau ~Dep~rtmentoifustlre~ndAt'.~y~ral 1].e:oi] QSC 4 I 0 Transcript of Proceedings Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau. SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION FRYBERG J No S11323 of 2000 ARKAROOLA PTY LTD (ACN 090 920 666) and NIUGINI MINING (AUSTRALIA) PTY LTD (ACN 011 060 898) BRISBANE .. DATE 18/10/2001 , JUDGMENT REVISED COPIES ISSUED State Reporting Bureau Date}{, //o / o I Applicant Respondent Floor, The Law Courts, George Street, Brisbane, a. 4000 Telephone: {07) 3247 4360 Fax: (07) 3247 5532 1 -- 1 of 16 -- 18102001 Tl/RB28 M/T 1/2001 (Fryberg J) HIS HONOUR: This is an application by the defendant to dismiss the proceedings for want of prosecution pursuant to rule 280 of the Uniform Civil Procedure Rules or alternatively in the inherent jurisdiction of the Court. The proceedings were commenced by the plaintiff by application filed on 22 December last year. They seek an order, presumably a declaration, that a letter from Blake Dawson Waldron to Corrs Chambers Westgarth is not a notice given in accordance with a certain deed and that the respondent/defendant has not terminated that deed. The deed referred to was what is called by the parties an asset transfer deed made on 20 January 2000 between them. The defendant is and was the holder of seven mining leases near Chillagoe. They relate to a decommissioned gold and copper mine in that area. The deed made provision for the transfer of the leases to the plaintiff, subject of course to ministerial consent and doubtless upon various other conditions. The deed had not been completed when on 18 December last year the defendant purported to terminate it alleging 1 10 30 breaches of it by the plaintiff. The particular breaches 50 are of no consequence for present purposes. It was the defendant's purported termination which presumably led to the originating application filed four days later. 2 JUDGMENT 60 -- 2 of 16 -- 18102001 Tl/RB28 M/T 1/2001 (Fryberg J) That application was returnable on 3 January. On that day and at the request of the plaintiff, though I infer without opposition from the defendant, the Court ordered that the matter be tried speedily and formulated a timetable for interlocutory steps. A speedy trial was, no doubt, appropriate having regard to the nature of the subject matter. The plaintiff's statement of claim was filed and served on 10 January 2001 and a defence and counterclaim was filed and served on 17 January. A reply was due on 22 January but was not filed or served on that day and in fact was not filed or served until 7 March. 1 10 20 30 Directions were made for interlocutory steps to be taken. On 30 January the plaintiff's solicitors tendered a request for trial date which stated that, save for exceptional circumstances, all interlocutory steps would be completed in accordance with the timetable, all witnesses would be 40 available and the action would in all respects be ready for trial by the end of February. Disclosure of documents was required to be provided by 5 February under the timetable. However, the plaintiff did 50 not comply with that timetable. Thereafter, there seems to have been slippage in other steps required to be taken on behalf of the plaintiff. The plaintiff's solicitors asserted difficulty in obtaining instructions. They did not serve affidavits which they were required to serve on 12 60 3 JUDGMENT -- 3 of 16 -- 18102001 T2-3/IK29 M/T 1/2001 (Fryberg J) February and on that day a revised timetable was set when the matter came before the Court. On 16 February an amended statement of claim was filed and served. On 16 March a list of documents was filed and served by the plaintiff. The defendant's list of documents was filed and served in· accordance with the timetable. Apparently in about March the plaintiff embarked on attempts to obtain third party disclosure of documents. This process occupied some time. A dispute arose about inspection of documents held by the plaintiff, or more accurately about the provision of photocopies of documents, the parties having chosen not to inspect but rather simply to exchange photocopies and that caused some delay but the defendant's disclosed documents were sent to the plaintiff on 12 April. The plaintiff did not send documents until some time later. In the meantime, the plaintiff withdrew its solicitors' instructions. Disputation about particulars in the Reply continued until May. Thereafter, the taking of steps seems 1 10 2 30 4P to have slowed and, indeed, in most respects stopped. The affidavits which were envisaged were never delivered by the · 50 plaintiff and consequently affidavits in response by the defendant, of course, have not been delivered. The same is true of expert reports. The defendant sought to have further steps taken requesting responses to letters which 60 4 JUDGMENT -- 4 of 16 -- 18102001 T2-3/IK29 M/T 1/2001 (Fryberg J) they had sent but apparently to no avail. On 8 October the present application was filed. The defendant bases the application on a number of grounds. First, it argues that the plaintiff has failed to comply with the timetables propounded by the Court. It instances the plaintiff's failuri to file and serve a reply until 7 March, a step which was required to be taken by 22 January; its failure to provide a list of documents until 16 March when it was required to undertake that step by 5 February and its 1 failure to serve affidavits upon which it intends to rely, a step which was required to be undertaken by 12 April. Second, the defendant points to indulgences already granted by the plaintiff in support of a submission that to grant further indulgences would be useless. The revised timetable issued by the Court on 12 February contemplated the completion of interlocutory steps by 17 May. Third, the defendant relies upon the plaintiff's failure to co-operate in getting the action back on track. Precisely what the defendant means by this is not altogether clear. One of the plaintiff's complaints is of difficulty in arranging for its experts to have adequate access to the mining leases for the purposes of the litigation. It asserts non-cooperation on the part of the defendant. The evidence in regard to that is summarised by the defendant in 5 JUDGMENT 1 10 20 30 40 . 50 60 -- 5 of 16 -- 18102001 T2-3/IK29 M/T 1/2001 (Fryberg J) this way. First, it says that from January 2001 its solicitors have consistently advised the plaintiff that the defendant would give reasonable consideration to requests for access to the leases on a case by case basis. The plaintiff's attitude to this varied but its ultimate position was to demand what it described as unhindered site access. Apparently, not getting this, it has not seen fit to proceed. There were a number of occasions in March when arrangements were made for the plaintiff's representatives to have access but they either did not attend or attended late and had insufficient time at the site. The history of the matter in relation to access, particularly in April and July of this year as shown by the correspondence, persuades me that the plaintiff has not genuinely attempted to arrange for its expert witnesses to attend at the site. It seems to me that the plaintiff's assertions that delay has been caused by the defendant in this regard are not correct. The defendant relies fourthly on an assertion that the plaintiff has apparently not even reached the point where it has finally settled upon a formulation of its claim. That 1 10 30 is based upon correspondence from the solicitors for the 50 plaintiff which has foreshadowed additions to the claim but no amendments have been made or sought. Additional claims have not been formulated. 60 6 JUDGMENT -- 6 of 16 -- 18102001 T2-3/IK29 M/T 1/2001 (Fryberg J) I am not satisfied that this assists the defendant's case since with the pleadings closed it is not to be assumed that the plaintiff is unwilling to proceed with the matter in its present form. The point that impresses me the most in the defendant's case is its last one. That is, that the plaintiff has advanced no satisfactory explanation for its failure to prosecute the proceedings. While I understand the difficulties which can arise when solicitors are not acting (and I should say that the solicitors who are presently acting for the plaintiff have been appointed only relatively recently), it is still necessary for the plaintiff when faced with evidentiary material indicating dilatoriness to condescend to an explanation. There have been assertions in correspondence made on behalf of the plaintiff to the solicitors for the defendant but 1 10 20 30 those assertions are unpersuasive and have not been verified 40 in material before me. In the circumstances of this case I am not willing to infer facts, particularly facts of the nature contained in some of the letters, without supporting evidentiary material in the form of testimony verifying the contents of the letters. 50 An example of this is the plaintiff's claim that the delay has been caused by its difficulties in obtaining non-party disclosure. There is a remarkable lack of particularity in the plaintiff's assertions in this regard. The only non- 7 JUDGMENT 60 -- 7 of 16 -- 18102001 T2-3/IK29 M/T 1/2001 (Fryberg J) party disclosure to which the plaintiff has referred is in relation to a Mr Sainsbury. There was an order made by Justice Mullins in March of this year in relation to that and inspection of those documents occurred at the end of that month. There is nothing in the material to indicate how this or any other attempts at non-party disclosure have impacted on the plaintiff's conduct of its case or how this hunt for non-party disclosure has prevented the plaintiff from concurrently preparing its case for trial, particularly, of course, when the nature of the subject matter is remembered and the fact that it was a speedy trial. I should have recorded earlier that the statement of claim, when delivered, included a claim for specific performance of the deed. The onus lies upon the applicant, the defendant, to demonstrate that the plaintiff's action should be dismissed for want of prosecution. The number of factors which may be taken into account are many and not all are relevant in the present case. In the present case, delay and failure to comply with the orders of the Court stand high in the list of relevant factors. They are reinforced by the plaintiff's inability to provide evidence to explain those matters. The absence of explanation is particularly sensitive in a case where a speedy trial has been ordered and where the proceedings are 8 JUDGMENT 1 10 30 50 60 -- 8 of 16 -- 18102001 T4/BC5 M/T 1/2001 (Fryberg J) for specific performance of an agreement relating to a mining lease. On behalf of the plaintiff, a number of matters have been urged. First, there was the matter of delay alleged not to be the fault of the plaintiff and caused by the hunt for third party disclosure of documents. This is no more than an allegation. It is not deposed to in the evidence nor, as I have said, is there evidence of how any attempts at third party disclosure of documents have impacted on the conduct of the proceedings. Second, the plaintiff asserts that the defendant is equally at fault with the plaintiff in causing delay and in noncompliance with the directions of the Court. In this regard, the plaintiff points, first, to its assertion that the defendant was in default in relation to inspection of documents. The defendant made disclosure of its list of 1 10 20 30 documents on time and forwarded copies of them to the 40 plaintiff promptly. The delay which occurred was caused by the plaintiff making demands for payment not only for the photocopying but for the employment of a person to do the photocopying of documents to be provided to the defendant. It does not seem to me that that delay can be laid at the 50 defendant's door. Third, the plaintiff asserted that if it was in default in filing affidavits, then so was the defendant whose affidavits were required to be filed long ago under the 9 JUDGMENT 60 -- 9 of 16 -- 18102001 T4/BC5 M/T 1/2001 (Fryberg J) Court directions. To that argument, Mr Clothier responded by pointing out that the defendant's affidavits were to be filed in response to the plaintiff's affidavits and that absent those of the plaintiff, it was simply not possible for the defendant's affidavits to be filed. That argument seems to me to be correct. Fourth, the plaintiff asserted that the defendant had not provided expert reports in accordance with the directions of the Court. To that assertion, the defendant's response was the same as that which it had advanced in relation to the affidavits and, again, it seems to me to be correct. Finally, the plaintiff asserted that the defendant was at least implicitly in default by amending its defence and counterclaim or further amending it after the time prescribed for pleadings. It is true that a further amendment was made by the defendant after that time. There was no prohibition on the parties making amendments to their pleadings and the rules permit that. In any event, the relevant amendment which was made in mid-2001 was simply to delete a claim from the counterclaim. It was a deletion of one paragraph of the pleading. It could not possibly have 1 10 20 30 contributed to any delay in the conduct of the proceedings 50 and reliance on it by the plaintiff simply indicates the paucity of material which the plaintiff had to rely upon. Another argument advanced on behalf of the plaintiff relied upon the failure of the defendant to comply with Rule 444 of 10 JUDGMENT 60 -- 10 of 16 -- 18102001 T4/BC5 M/T 1/2001 (Fryberg J) the Uniform Civil Procedure Rules. That Rule provides that before making an application of this sort, the applicant must write to the respondent specifying a number of matters. The present applicant did not write any such letter although several of the matters required to be included had been referred to in earlier correspondence. None of the grounds of exemption from the rule that are set out in subrule (5) would seem to apply in the present case. The defendant is, therefore, in default under that rule and that is a reason why the Court might decline to hear an application. ·The failure to comply with the rule would have some particular importance if it were shown that the non compliance in some way operated to the detriment of the plaintiff or in some way contributed to the plaintiff's delay or to the failure of the action to be prosecuted. Counsel for the plaintiff was, however, unable to point to any evidence which suggested that this effect had occurred. The Court has power, under Rule 448, to hear an application notwithstanding non compliance with part 8 of the rules. That rule also allows the Court to decide an application partly on the basis of the contents of letters between the applicant and the respondent. The course which commends itself to me in the present case is to hear the application notwithstanding non compliance. This does not mean that I am, in any way, sympathetic to the position of the defendant in not complying with the rule. 11 JUDGMENT 1 10 20 30 40 50 60 -- 11 of 16 -- 18102001 T5/IRK13 M/T 1/2001 (Fryberg J) There is before me no satisfactory explanation for the defendant's failure to comply with the rule. It is important that these rules be complied with because significant savings in costs can be achieved by compliance. In the present case there is no suggestion that had the rule been complied with, the plaintiff would have agreed to the dismissal of its action without the need for a Court hearing. Nonetheless, this is an issue to which I will revert when the question of costs arises. Next, the plaintiff relies upon what it describes as the conduct of the defendant immediately preceding this hearing. That heading seems to refer to the evidence contained in an 1 10 affidavit filed today by leave on behalf of the plaintiff, 30 the contents of which are mostly designed to support a cross application which the plaintiff seeks to bring before me today. It discloses that earlier this year, and I was told on 20 August, in fact, a Mr Raymond Lindwall, formerly a partner with Corrs Chambers Westgarth, the solicitors who acted for the plaintiff at the beginning of the proceedings and whose retainer was terminated at an early stage, became a partner with Blake Dawson Waldron, the solicitors for the defendant. Now, when that occurred in August the fact was made known to the plaintiff. No objection to the firm, Blake Dawson Waldron, continuing to act was raised at that time. It has been asserted in correspondence that Mr Lindwall has nothing . 50 to do with the conduct of this case and that, in particular, 60 12 JUDGMENT -- 12 of 16 -- 18102001 T5/IRK13 M/T 1/2001 (Fryberg J) he has had nothing to do with the present application and there seems to be nothing in the material suggesting that he has been, in any way, involved or that anything in the present application is detrimental to the plaintiff by reason of his being a partner in the firm. In any event, I do not quite understand how those events can be taken to have contributed to delay or to the plaintiff's failure to prosecute its action. Had the plaintiff made protest about the presence of Mr Lindwall in August when the move occurred and been distracted by that issue since then, the position might have been different, but the plaintiff did not make any objection to the solicitors for the defendant acting on the defendant's behalf until 11 October, one week ago, and after the present application had been brought. It does not seem to me, therefore, that these considerations are of material 1 10 20 30 effect on the merits of the present application. 40 Further the plaintiff urged that I ought now to be satisfied that whatever past dereliction the plaintiff was guilty of it was now repentant and that I should be satisfied that there would be no further delay or failure to comply with 50 orders. In support of this it was pointed out that the plaintiff has now engaged Queensland solicitors - the reference to Queensland being because during the time when it had no solicitors on the record, it was in fact receiving advice from a Victorian solicitor - and by implication, that 13 JUDGMENT 60 -- 13 of 16 -- 18102001 T6-7/RB28 M/T 1/2001 (Fryberg J) - with the engagement of Queensland solicitors the matter would gain a new lease of life. Counsel pointed to the plaintiff's offers to remedy the situation which has arisen and submitted that the plaintiff had addressed the questions of delay and was now willing to ensure that timetables ·were complied with. I have no confidence that this is so. There is, as I have said, no satisfactory material indicating precisely how delay has occurred and certainly no undertaking on behalf of any person behind the plaintiff to behave in any way different from what has occurred so far. In this context, and indeed in earlier contexts, I should note that I have not overlooked the provisions of rule 448 in relation to the evidentiary basis upon which the Court may proceed in applications of this sort. It is not always necessary that parties should depose to facts which are set out in correspondence. Where, however, those facts and the inferences to be drawn from them are controversial it is, in my view, desirable 1 10 2 30 that affidavit evidence should be received and that it · 50 should be available. The Court has power to direct that such evidence be received and, it seems to me, that this is a case where that should have occurred. I am certainly not willing to decide this application on the basis merely of contents of letters. 14 JUDGMENT 60 -- 14 of 16 -- 18102001 T6-7/RB28 M/T 1/2001 (Fryberg J) Finally the plaintiff relied upon an assertion that no substantial prejudice had occurred to the defendants. It is true that there is no evidence of immediate or direct specific pecuniary prejudice to the defendant. Nonetheless the whole conduct of the case, having regard to the subject matter and the relief sought, is such that the defendant must have been prejudiced. Its inability to deal with its mining lease while the litigation is on foot is obvious. The plaintiff's claim simply does not seem to me to be such that its failure to prosecute the claim ought be excused. Taking these matters into account, therefore, I have come to the conclusion that this is a case where the plaintiff has failed properly to prosecute its case. In these circumstances, in my view, the appropriate course to take is that which is sought by the defendant, that is to dismiss the proceeding for want of prosecution. The present application will be allowed and the order of the Court will be that the principal proceedings brought by application filed on 22 December 2000 be dismissed. HIS HONOUR: In my view the failure of the applicant/defendant to comply with rule 444 is something to be noticed and taken into account in relation to the 15 JUDGMENT 1 10 20 30 40 50 60 -- 15 of 16 -- 18102001 T6-7/RB28 M/T 1/2001 (Fryberg J) question of costs, not only in relation to the application but also in relation to all costs which it seeks. The Court is very concerned to ensure that rule 444 is complied with. It is a rule which was introduced into the Uniform Civil Procedure Rules with a view to minimising costs and it is important that the Court is astute to enforce compliance with the rule. I would not be prepared to try to enforce it by keeping afoot litigation which ought to be terminated, but it seems to me appropriate that in the circumstances of the present case the Court should mark its disapproval of the non- compliance with the rule by refusing to make any order for costs. There will be no order as to costs. 16 JUDGMENT 1 10 2 30 . 50 60 -- 16 of 16 --