Citicorp Australia Ltd v Metropolitan Public Abattoir Board & Anor [1990] QSC 272

10 C 30 C - -- .. ~--- f IN THE SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION No. 2860 of 1980 BEFORE MR. 'JUSTICE DERRINGTON BRISBANE, 23 AUGUST 1990 (Copyright in this transcript is vested in the crown. Copies thereof must not be made or sold without the written authority of theChief Court Reporter,Court Reporting Bureau.) BETWEEN: CITICORP AUSTRALIA·LIMITED -and- METROPOLITAN PUBLIC ABATTOIR BOARD -and- THE QUEENSLAND MEAT INDUSTRY ORGANISATION AND MARKETING AUTHORITY JUDGMENT Plaintiff (Appellant) First · Defendant Second Defendant(Respondent) HIS HONOUR: The appeal should be upheld and the second defendant's application to set aside the plaintiff's summons _ sh9uld be dismissed with costs, including reserved costs, if 40 so 60 any, to be taxed. The defendant should also pay the plaintiff's costs of and incidental to the appeal to be. taxed. Because of the differences of judicial opinion which have been referred to on certain issues upon which the above discussion depends, the defendant should have leave to appeal against this decision if it chooses. I publish my reasons. - -Govt. Printer, Qld. 1 10 20 30 40 50 60 -- 1 of 16 -- IN THE SUPREME COURT OF QUEENSLAND Before Mr. Justice Derrington BETWEEN: CITICORP AUSTRALIA LIMITED METROPOLITAN PUBLIC ABATTOIR BOARD No. 2860 of 1980 Plaintiff (Appellant) First Defendant C AND: C THE QUEENSLAND MEAT INDUSTRY ORGANISATION AND MARKETING AUTHORITY CATCHWORDS: Second Defendant(Respondent) JUDGMENT ON APPEAL - DERRINGTON J. Delivered the 23rd day of August, 1990. Practice. "Proceeding" in an action. Whether informal request by letter for further inspection is a proceeding. Whether theresumption of inspection and taking of copies of documents but for that purpose loses its status as a proceeding because of long delay. Whether a further step defeated by delay after service of notice of intention to proceed. R.S.C. 0. 35, r. 14; 0. 90 r. 9. Counsel: Solicitors: D. Fraser for Appellant. R. Holt for Respondent. Henderson Trout for Appellants. Chambers, McNab, Tully & Wilson for Respondent. Hearing dates: 17th August, 1990. -- 2 of 16 -- C C C C IN THE SUPREME COURT OF QUEENSLAND BETWEEN: CITICORP AUSTRALIA LIMITED METROPOLITAN PUBLIC ABATTOIR BOARD No. 2860 of 1980 Plaintiff (Appellant) First Defendant THE QUEENSLAND MEAT INDUSTRY ORGANISATION AND MARKETING AUTHORITY Second.Defendant(Respondent) JUDGMENT ON APPEAL - DERRINGTON J. Delivered the 23rd day of August, 1990. This is an appeal from an Order by a Master made on the application of the second defendant that the plaintiff's summons seeking an Order for further or better particulars be set aside for irregularity on the ground that it was brought more than three years after the last proceeding in the action without the leave of the Court or a Judge obtained pursuant to 0. 90 r. 9 of the Rules of the Supreme Court. With respect, the learned Master was certainly right in venturing that it would be a gross understatement to say that this action had proceeded at a leisurely pace, but the chronology does not suggest that the blame should be entirely attributable to the plaintiff rather than to the second defendant, which is -- 3 of 16 -- -----------------------c----------c---------:-----~----------~-~- 2 the only real defendant~ It is sufficient to say that the Writ was issued on the 17th July, 1980 and the relevant circumstances commence in October 1983 with the commencement of the plaintiff's inspection of the defendant's documents. An extraordinarily large number of documents had been properly produced for inspection in the boardroom of the second defendant's premises at Cannon Hill, so for the convenience of the plaintiff's solicitors and to release the boardroom which was inordinately Q cluttered up, the parties very reasonably agreed in April 1984 that the documents should be taken to the plaintiff's solicitors' office where the inspection could be continued without need for the presence of the second defendant's solicitors. It is perhaps desirable to mention the other matters of historical interest by setting them out in a chronology which includes the above events: 17th July, 1980 October 1983-April 1984 Event Writ issued Plaintiff inspects defendant's 0 0 documents at Cannon Hill \ April 1984 31st July, 1985 6th December, 1985 Week of 23rd March, 1987 17th January, 1989 '0 Documents taken to plaintiff's solicitors' office Plaintiff gives notice of intention to proceed Plaintiff serves request for further and better particulars and notice to admit facts Plaintiff completes inspection of defendant's documents and takes copies of relevant documents Plaintiff gives· notice of intention to proce-ed and returns defendant's documents -- 4 of 16 -- 0 0 ,Q I 3 with a request for a further inspection - -· 16th January, 1990 Plaintiff fiies application :fir order for particulars 22nd January, 1990 Plaintiff serves application for particulars 21st February, 1990 Plaintiff serves further notice of intention to proceed 22nd February, 1990 Defendant files application to set aside plaintiff's summons There was some contention as to whether the request for further inspection on the 17th January, . 1989 as stated in the above chronology constituted a proceeding within 0. 90 r. _9 and this might be disposed of first. In a letter of that date to the solicitors for the defendant the solicitors for the plaintiff had said: "The document~ that now remain to be inspected are_ those at your office, comprising documents 2533-2782. --- We would like to make arrangements to inspect these documents at your convenience." This was an informal request and does not correspond with C a notice in writing requiring the defendant to produce · such document for inspection as set out in O. 35 r. 14 which provides: "14. Inspection of Documents referred to in Pleadings · or Affidavits. Any party to a cause may, at any time by notice in writing, require any other party, in whose pleadings, particulars, or affidavits or list furnished under Rule 10, 11 or 12A, reference is made to any document, to produce such document for the inspection of the party giving such notice, or of his solicitor, and to permit him or them to take copies thereof." The distinction between a formal requirement and an informal request may be observed in form no. 151 to the - Forms to the -- 5 of 16 -- -----------~---------~~-~-~---- 4 Supreme Court -Rules although it is not obligatory to follow such forms. While it is possible to undertake a "proceeding" under - the Rules in an informal way, informal correspondence touching what would be a proceeding may not reach that status: Williams v. Brisbane City Council (unreported - Shepherdson J. - 11th July, 1985); Bain Dawes· (Old) Pty. Ltd. v. Hill (unreported - Lee M. (as he then was) - 27th June, 1986). That is the position here, for the relevant request falls far short Q of a requirement by a party as the Rule prescribes, so this was not a proceeding within 0. 90 r. 9. It follows that the second defendant is not caught by any implied waiver by failing to apply promptly to have the "proceeding" set aside as occurred in Perez v.· Transfield (Old) Pty. Ltd. (197_9)_ Qd. R. 444. The existence of this - threat 0 in_cidentally is one reason for caution in adopting a too-liberal acceptance of such informal conduct. It must be added however Q that ~f this were an application by the plaintiff for leave to proceed under 0. 90 r. 9, such a request made in the context of a mutually courteous and informal procedure where the parties were co-operating in this exercise might well be regarded for that purppse as an equivalent of such a notice as required by · 0. 35 r. 14 for it would manifest to the other party an intention to keep the action alive; but that does not mean that it is a proceeding for the purposes of the Rule. It is necessary then for the plaintiff to rely upon some other act on its part to sustain its claim that there had been no period of three years during .which there was no proceeding taken. 0 -- 6 of 16 -- 5 The point of greatest controversy is .the . action by the plaintiff's solicitors. during _the week commencing 23rd March, ' ·,. 1987 in inspecting those documents left with them by the second defendant's solicitors _and taking copies of.relevant ones. The question is whether this constitutes part of the inspection of such documents and whether it might be described as a "proceeding" within the meaning of O. 90 r. 9 so as to interrupt Q the running of the_ time limited by that rule, which, where C relevant, reads: 11 9. Notice After Delay of One Year. When no - proceeding has been taken in a cause for one whole year from the time when the last proceeding was taken, any party who desires to proceed shall, before taking any step in the cause, give a month's notice to every other party of his intention to proceed. When three years have elapsed from the time when the last proceeding was taken, no - fresh proceeding shall be taken without the order of the Court or a ~udge, which may be made either ex parte or upon notice." In Kaats v. Caelers (1966) Qd. R. 482 at p. 499, ·Stable J., ., ., citing from earlier authorities, referred to a "proceeding"_ within the meaning of the Rule as being "some step taken toward the judgment or relief sought in the action". It must be a "proceeding taken with a view to continuing the litigation between the parties to ~t'': Sriencer v. Watts (1889} 23 Q.B:D. 350 per Landley L. J. at p. 353, and is a "step towards judgment": Webster v. Myer (1884) 54 L.J.Q.B;. 101 at p. 102 per Brett M.R. The word "is one that suggests something in the nature of a formal step, at least a step taken by the litigant in the prosecution of the action, being a step required by the Rules": Mundy v. Butterly Co. (1933) 102 L.J. Ch. -23, 26; Burns v. Korff O. S. 397 of 1980 - - unreported; Josef ski v. -- 7 of 16 -- --------------------~----~ 6 Minister for Education '(W. 30. of· ;1978, Rockhampton unreported) ; Leech v. International Portion Foods Pty ~ Ltd. (1984) 2 Qd. R. 152. In Russell v. Mihaljevic Amperson & Anor. (unreported) - Full Court of Queensland -- 24th June, 19_82, the ctbove citations from Kaa ts v. Caelers were approved and it was held that a compulsory conference provided for by 0. 39 r. 30A(4)(e) of the Rules was a proceeding within the meaning of 0. 90 r. 9, though it had been held in an informal way by telephone. So too was the production of a signed certificate of readiness pursuant to O. 39 r. 30A(5). The former was a condition precedent to the sign~ng of a certificate of readiness and the presentation of a signed certificate of readiness was necessary to be the next step of setting· the matter down for _trial. •· Some informality was agai·n disregarded in Bain Dawes (Old) Pty. Ltd. v. Hill· (supra) where it was held following Williams v. Brisbane City Council (supra) that an inspection under 0. 35 r. 14 is a "proceeding" within the meaning of 0. 90 r. 9 and that a proceeding is not limited to the initial step taken in pursuing a step required by the Rule, that compliance some years later with an informal request by' the provision of the requested copies of certain discovered documents constituted proceedings within the meaning of the Rule. The issues and arguments were thoroughly canvassed in that judgment and do not require repetition. And in Wright v. Ansett Transport Industries Limited (1990) 1 Qd. R. 297, it was noted that it was undisputed that the last. step in that action occurred when the plaintiff inspected the documents discovered by a defendant. It was held that the provision of 0 0 0 0 -- 8 of 16 -- 7 copies- of . documents after a notice requiring their production but not requiring inspection_ still. constituted a proceeding within the required meaning. It is clear from the statements and discussion provided by these authorities and those which they review that the term "proceeding" which is broad and without a fixed meaning, should be construed by reference to the purpose behind the provision in C which it is contained, which of course is designed to prevent a party's continuing without leave if for three years continuously C C C the matter has gone to sleep to the extent that no real step has been taken to advance it towards finality. In one direction it does not exclude reliance upon conduct which is a step . in substance even though it may not be formally undertaken, providing that its effect is that which is recognised as a step in the action; and in the other direction it does not accord recognition to conduct which may be formal and provided for by the Rules but which does not advance the action, . such as a notice of change of solicitors or a notice of intention to proceed under O. 90 r. 9. It is for this reason t}:lat an informal inspection in the form of receipt and perusal of copies of the documents is regarded as a proceeding, for the Rules provide for such a step which is in substance directed towards the progress of the litigation. It is also recognisable as a distinctive step in contrast for example with informal letters between the solicitors' for the.parties designed to provoke a response in the way of compliance with some provision. of the. Rules. -- 9 of 16 -- 8 The present ·matter· is complicated by the arrangement ·between the parties whereby the second defendant handed over the custody of this large volume of - relevant documents to the plaintiff to inspect· and take copies at· ·any time· and without any need for pre-arr·angement with itself. While this attitude is to be applauded as both practical and reasonable in minimising the cost of the litigation, nevertheless it put into the plaintiff's hands the opportunity, with qualifications, of taking the Q relevant step at a time of its· choice. The qualifications referred to are these. First the defendant itself could have given·a notice requiring the return of the documents within a reasonable. time of the notice, and the termination of ·· the arrangement would · have also terminated the plaintiff-' s unilateral ch6lce. Secondly, with the · passage of time the 0 defendant c·ould have applied to the . Court·· to have the matter struck out for want CJf- prosecution~· particularly if a period of Q three years had expired which would have required the plaintiff to have sought leave to proceed. Even if only more than a year had elaps-ed since the last antecedent step,.· in the absence of any prior notice· of intention to proceed from the plaintiff as required by· O. 90 r. 9 the defendant would have been able to apply to the Court to have any act of inspection struck out as a proceeding, providing that it took such step promptly after learning that it had been performed. The principal findings ·by the Master against the plaintiff are that its inspection and taking of copies occurred so long after the process of inspection had been begun that they ·could no longer be regarded as part of that process for that, it was -- 10 of 16 -- 0 0 0 C 9 said, must be completed within a. time after its commencement which. is reasonable .in the circumstance; and that a party in . ' . ' . this position cannot reserve the absolute right to defeat the operation of the Rule by unilaterally carrying out such an act, particularly outside the knowledge and control of the other party, for that would render t.he effects of the Rules nugator1:. The latter proposition. is really an explanation of the reasoning behind the former. With respect, if an inspection and the taking of copies is in fact an inspection and taking of copies under the Rules, then it cannot cease to have that quality by reason ~f any delay and . a fortiori if the limitation Rule allows for some delay and the other party has appropriate remedies otherwise. The authorities indicate that the action of which the proceeding consists does not cease at its commencement, but continues through until it is concluded, and if there is an act which is unequivocally and substantially a part of the relevant conduct in fact then the delay in its conclusion cannot defeat that fact: Bain Dawes. It is impossible to say that the real and substantial. inspection and taking of copies of various documents in this case did not _constitute part of the inspection process notwithstanding the gravity of its delay. Within this context "inspection" under 0. 35 r. 14 is. the description of the performance of the act of ' inspecting. It is not an artificial concept. When there is a .real and substantial performance of that act then it merits such a title for it conforms with the concept of a clear step prescribed by the Rules which has the effect of advancing the . action. It is easy to understand how there is a temptation to -- 11 of 16 -- 10 regard gross delay · in its pursuit· as· putting a different complexion upon·· it, but the relevant conduct in this case is so manifestly a feature of the inspection· that the delay cannot make it anything other than it is. If it had been conducted at the second defendant's boardroom in the presence of its solicitors, it must have answered the description of an inspection, .and the· difference in circumstances cannot afford any distinction, particularly as the second defendant was a parti to the arrangement. Similarly, because of the remedies available to the second defendant discussed above, it cannot be said that the plaintiff has ·taken to itself any absolute right to defeat the operation of O. 90 r. 9. Whilst the second defendant has put in the plaintiff's harids the choice of time in making its inspection, ana· had the opportunity· of terminating that choice, the plaintiff was still bound by the Rules. The Rule imposed upon 'the plaintiff a time limit within which to take or continue the step of proceeding; but it also allowed to it three years since the· previous step to undertake this proceeding. After that period, it was subject to an application to have the matter struck out for want of prosecution if that were justified, and if it wished to continue it would have had to obtain leave to proceed. · In this situation to which the second defendant voluntarily subscribed, it is also immaterial that the plaintiff's act was unilateral and alone, without any "interchange between the parties": Bain Dawes p. 15. As it turns out, the plaintiff had failed to give the mandatory one month's notice of its intention to proceed. prior 0 0 0 -- 12 of 16 -- 1 1 to its taking this.-further step of inspection and so the latter was irregular, but-the defendant failed to have that step set aside within a reasonable time, and consequently suffers the implication of a waiver as defined in Perez v. Transfield (Old) Pty. Ltd. The assessment of a reasonable time within which to bring an application to set aside that inspection under 0. 93 r. 17 commenced only from the time when the defendant had been •Ci made aware that the plaintiff had conducted the inspection, and the waiver could not have been implied if the defendant had made C' C C its application within a reasonable time of that date. It did not do so and must suffer the consequences. However, because it had the opportunity to do so, the plaintiff cannot really be said to have used the delay or any unilateral act to have defeated the Rule. .Accordingly this is not a reason for regarding the inspection as anything other than what it was. That being so, the, plaintiff's resumed inspection and taking of copies was a proceeding within the meaning of the Rule in the week of 23rd March, 1987 and as the time recommenced to run from that date the plaintiff's summons for further and ._ better particulars was brought within time. There is however an alternative ground said by the second defendant to justify the conclusion reached by the Master although it was not argued. It is based upon a proposition that because the notice of intention to proceed was not followed "timeously" by the summons for further and better particulars, which was not brought until after almo~t twelve months, ;therefore it was not effective to comply with the Rule requiring -- 13 of 16 -- ,------- ----·-----·--- -----· -- -------- ···--·------~-- ---- 12 the giving of notice · before such a ·-further· step: Wright v. Anse'tt Transport Industries Limited (supra). With the greatest reipect to that view, stich a constraint upon the effectiveness of a notice cannot be read into the Rule which requires simply that if no proceeding has been taken ·in the action for upwards of twelve months, then any party who desires to proceed shall, before taking any step, give a month's notice of his intention to proceed, and that is the only time Q limitation e:kcept for the different provision requiring leave to proceed where no proceeding has been taken for three years. It certainly does not require a fresh notice after each · twelve months of inaction and apart from the leave to proceed provision it certainly does not specify a time.within which the further step must be· taken· after the service of the notice. rt' is u:ndoubtedly true that the purpose of the notice is to 0 · alert the other· party that the party giving the notice intends 0 to revive the dormant action. It is also true that a·· further failure to take action reasonably promptly after the notice may suggest recidivism which may again put the recipient off guard. However the alternative would have the effect of placing a party who withholds the notice until the very last moment shortly before the effluxion of the three year period in a better position than one who gives a notice early, and there is no justification for that. When it is remembered that the requir~ment to give such a notice predicates the passing of more than a year of the three years allowed, the expectation that the recipient of the notice should prepare and remain on guard for the balance of the period is not oppressive, and of course any <J -- 14 of 16 -- C C' C' 13 disadvantage by reason of delay can usually be remedied by an adjournment. Conversely there is good reason to feel that if the party "desires to proceed" after the year has passed, it is desirable that .a notice be given as early as possible, even though an immediate step is not contemplated, rather than that it delay the notice until a month before it intends to take the step. The most telling feature is that.by its ordinary meaning the Rule simply . does not require more than that the notice should precede the next step by a month and upwards. Nor has it ever been suggested that such time is limited to precisely one month and no more. Because of the drastic consequences that may flow from non-compliance with the Rule in this respect, it is necessary that such a limitation as that proposed be more explicitly stated before the Rule can be so .. construed as to deprive the giver of a notice of the right to proceed at any time after notice within the three years otherwise limited, which is the right given by the primary meaning of the words used. As it is expressed the requirement to give notice is first related to the party's desiring to proceed, and not necessarily desiring to take a step at that time. The only reference to time associated with the taking of a further step is in the restraint imposed upon such a party who desires to proceed so that no step can be taken in the proscribed period. In this way such reference to the taking of such a step is not made in a mandatory passage but rather in a prohibition against taking it within that time. To attach a duty to take a step within a limited time to such a reference is to disregard the -- 15 of 16 -- 14 manifest purpose behind its use in the context. For these reasons the plaintiff's application should not be set aside upon the submission that it was not preceded by an effective notice. The appeal should be upheld and the second defendant's application to set aside the plaintiff's summons should be dismissed with costs including reserved costs if any to . be taxed. The defendant should also pay the plaintiff's costs of and incidental to the appeal to be taxed. Because of the differences of judicial opinion which have been referred to on certain issues upon which the above discussion depends, the defendant should have leave to appeal against this decision if it chooses. .... ,. ~) \ __ J 0 () () -- 16 of 16 --