Dia Kensetu Co Ltd v Gifford
[1999] QDC 216
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- Dia Kensetu Co Ltd v Gifford[1999] QDC 216
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Dia Kensetu Co Ltd v Gifford[1999] QDC 216
Dia Kensetu Co Ltd v Gifford[1999] QDC 216
IN THE DISTRICT COURT | PLAINT NO: 320 of 1994 |
HELD AT SOUTHPORT
QUEENSLAND
Before HALL D.C.J.
BETWEEN:
DIA KENSETU CO LTD | Plaintiff |
AND:
LACHLAN RICHARD GIFFORD | Defendant |
REASONS FOR JUDGMENT - HALL D.C.J.
(Delivered the 30 day of July 1999)
The plaintiff in this action claims $91,958.05 being monies owing pursuant to a lease of premises in Raptis Plaza. The defendant counter-claims the sum of $183,000.00 damages for breach of contract and breach of the Trade Practices Act arising out of representations made by the plaintiff. The plaintiff seeks leave to proceed pursuant to Rule 389 of the Uniform Civil Procedure Rules, there having been no step taken in the action for more than three years.
The only explanation given for the plaintiff's inactivity since September 1995 is contained in the affidavit of Stephen Barry Collins, the solicitor for the plaintiff. He swears that the plaintiff which is incorporated in Japan, had a policy in 1995 to allow unresolved litigation to lie idle unless the opponent sought to resolve them or to proceed to trial. That policy had now changed and the plaintiff now desired to resolve all outstanding litigation. Indeed Ms Forde, for the plaintiff, informs me that as the relevant limitation period has not expired a dismissal of this application will lead only to the institution of a new action in this Court.
The defendant opposes the application and alleges that he will be seriously prejudiced if it is allowed. In particular he claims that his entire file relating to the business he had conducted in the subject premises has been destroyed. Those records had been retained for at least six years and in the course of moving from the Gold Coast to Brisbane recently they were disposed of along with other “papers and rubbish”. None of those records had been supplied to his solicitors so no copies are in existence. He alleges also that the memories of his witnesses will be open to criticism and doubt because of the passage of time. The defendant swears further that he had not intended to pursue his counter-claim unless the plaintiff prosecuted its claim as he believed that the plaintiff had been suffering financial difficulties during the relevant period. In response to the suggestion that a new action can be brought in respect of the same claim Mr Laurie argues that I should not take that matter into consideration because the new action would probably be stayed as an abuse of process in accordance with the principles expressed in Birkett v. James (1978) A.C. 297.
I am not satisfied that is so. Decisions such as Madden v. Kirkegard Ellwood & Partners (1983) 1 Qd.R. 649 indicate that the result suggested by Mr Laurie would be an exceptional one. However it is not a matter for me to determine at this stage.
The law relating to this application is relatively clear and is conveniently encapsulated in the judgment of Connelly J in Dempsey v. Dorber (1990) 1 Qd.R. 418 at 420 where he said:
“On an application for leave to proceed under O.90 r.9, the applicant believed must ‘show that there is good reason for accepting the particular proceedings from the general prohibition’ on the taking of a fresh proceeding without the order of a Court or Judge in a case in which three years have elapsed from the time when the last proceeding was taken. See William Crosby & Co Pty Ltd v. Commonwealth (1963) 109 CLR 490 at 496. This test was reaffirmed by the High Court in Australian Broadcasting Commission v. Industrial Court of South Australia (1985) 159 CLR 536. The question whether there is good reason for making such an order obviously involves a consideration of all relevant matters and the question whether there was a reasonable excuse for the delay is unquestionably a relevant matter. See Campbell v. United Pacific Transport Ptv Ltd (1966) Qd.R. 465 and indeed it has loomed large in the consideration by the Full Court of an application under O.90 r.9. In my judgment the proper approach to the question such as this is to identify the relevant factors, assess the weight to be given in the circumstances to the case of each of them, and then to determine whether, on balance, there is good reason for making the order.”
A consideration of the decided cases clearly demonstrates the importance given by all Courts to the question of prejudice to the party opposing an application for leave to proceed. In Brisbane South Regional Health Authority v. Taylor (1996) 70 ALJR 86 at 871 McHugh J said:
“For nearly 400 years the policy of the law has been to fix definite time limits (usually 6 but often 3 years) for prosecuting civil claims. The enactment of time limitations has been driven by the general perception that where there is delay the whole quality of justice deteriorates (R v. Lawrence (1982) AC 510 at 517 per Lord Hailsham of St Marylebone LC.)
Sometimes the deterioration in quality is palpable as in the case where a crucial witness is dead or an important document has been destroyed. Sometimes, and more often than we realise, the deterioration in quality is not recognisable even by the parties. Prejudice may exist without the parties or anybody else realising that it existed. As the United States Supreme Court pointed out in Barker v. Wingo (1972) 407 US 514 at 532 ‘What has been forgotten can rarely be shown’. So it must often happen that important perhaps decisive, evidence has disappeared without anybody now ‘knowing’ that it ever existed. Similarly it must often happen that time will diminish the significance of known fact or circumstances because its relationship to the cause of action is no longer as apparent as it was when the cause of action arose.”
The plaintiff's explanation for its delay can be described as a reasonable one. The company made a decision based on economic grounds to adopt a policy concerning pending litigation. That was not a decision to abandon the cause of action but simply to allow it to lie dormant. Consequently, in my view, that delay could not be held to be inexcusable. On the other hand the defendant, in destroying documents relevant and indeed critical to proof of his counter claim has acted with naivete or even stupidity. I find it difficult to imagine how his solicitors could have drafted a Defence and Counter-claim raising a claim for $183,000.00 damages without viewing some documentary proof of that claim. If documents were made available to the solicitors then I would expect copies would have been made of those documents and retained by the solicitor. As against that there is an unequivocal sworn statement by the defendant as to the destruction of his evidentiary material and no ground exists in the material before me for disregarding that claim.
The situation then is that while the decision of the plaintiff to allow the claim against the defendant to lie dormant for so long did not cause an “inexcusable delay” it has had the result that the defendant is now unable to prove the damage which he claims to have suffered and thus is unable to establish his counter-claim. That situation has arisen directly as a result of the delay of the plaintiff in prosecuting its claim against the defendant and in my view is a complete answer to this application. Formally I find that I am not satisfied that there is “good reason for excepting the particular proceedings from the general prohibition” contained in r.389 of the Uniform Civil Procedure Rules.
The application is dismissed. I order the applicant pay the respondent's costs of and incidental to this application to be assessed.