Holst v Nichols
[2004] QDC 519
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- Holst v Nichols[2004] QDC 519
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Holst v Nichols[2004] QDC 519
Holst v Nichols[2004] QDC 519
[2004] QDC 519
DISTRICT COURT
CIVIL JURISDICTION
JUDGE ROBIN QC
No DB2001 of 2003
SVEN TONY HOLST | Plaintiff |
and |
|
PHILLIP NICHOLS | First Defendant |
and |
|
FEREL ENTERPRISES PTY LTD (ACN 095 220 901) |
Second Defendant |
BRISBANE
DATE 23/11/2004
ORDER
CATCHWORDS: | Uniform Civil Procedure Rules r 188 - application by individual defendant to withdraw admission that he acted on his own behalf (as well as for a company to be formed) - withdrawal permitted (with order for indemnity costs against defendants) as trial was no longer imminent - trial dates and request for trial date had been vacated. |
HIS HONOUR: This is an application by the defendants (or the first defendant Mr Nichols at least) to withdraw an admission made in the defendants' pleading of an allegation in Mr Holst's statement of claim to the effect that when Mr Nichols acted he did so on his own behalf as well as on behalf of the defendant company.
The assumption has been that for the moment the company has no or negligible assets which might be available to meet a judgment. It, along with Mr Nichols, mounts a counterclaim which over-tops Mr Holst's claim. The application under rule 188 is for the Court's leave which the rule makes necessary for the withdrawal of that admission.
The consequence of its withdrawal is that the plaintiff will be returned to his original situation of having to prove a personal liability in Mr Nichols and will lose the benefit he has had for some time of an admission in that regard.
The issue was canvassed before me some weeks ago on the eve of trial when application was made by new solicitors on the defence side to vacate trial dates. The former solicitors were exercising a lien on documents.
It appeared to me futile to require the trial to proceed given that it seemed to me that a renewed application for adjournment before the trial Judge would almost certainly be successful.
I fixed new trial dates with a view to getting finalization of the matter which, although important to the parties, considered objectively does not involve enormous amounts of money, except perhaps for legal costs. Unfortunately, the matter could not go ahead. The parties blame each other for that. The likelihood is that the defendants bear a greater responsibility.
Her Honour Judge O'Sullivan on the 2nd of November vacated the trial dates set by me, also the request for trial date. She ordered that the first and second respondents file an application for leave to withdraw admission on or before the 15th of November 2004. When the matter was last before me I had done my best to make it clear that the admission could not be withdrawn except pursuant to leave.
There is no application filed, but I see no reason why the liberty to apply granted by her Honour could not be availed of as it has been. Indeed, the same approach was taken on the 2nd of November 2004 by her Honour utilising liberty to apply reserved by me on the 30th of September 2004.
The matter was stood down today to permit the attendance of Mr Nichols in the light of Mr Charrington's objection to the material that had been relied on hitherto being several affidavits of Mr Venville, who is running file for the defendant's present solicitors.
I think Mr Charrington was right, that evidence ought to be placed before the Court on an application under rule 188 which is contentious, so that in the Court the merits of the contention that the admission to be withdrawn was made by mistake can be properly tested considered.
In Saeedi v Patterson [1998] QCA 181, there was such an affidavit, but it failed to persuade the District Court Judge, who refused to allow withdrawal of the admission. An application for leave to appeal was dismissed, with costs.
Notwithstanding all the work done by Mr Venville, I would not have acted on the basis of the hearsay information in his affidavit. No good reason emerged why Mr Nichols himself could not have sworn an affidavit, which he has now done - or why the supposedly errant former solicitor, who had, it is said, misconstrued instructions to him, could not have sworn an affidavit.
Indeed, Mr Charrington comments on the absence still of any evidence from that practitioner, but that does not concern me. I think it is enough for present purposes that the Court has the contribution of Mr Nichols, who was cross-examined by Mr Charrington.
It is not right for the Court to pronounce any final conclusions based on that evidence, as to Mr Nichols' contention in his affidavit very recently sworn that:
"The plaintiff was always aware from his discussions with me, and agreed with me that it was always intended that the Team be operated through a corporate structure, which I was to incorporate at the plaintiff's expense."
There "the plaintiff's" is an error, one of a very large number of errors in the material on the defendant's side. Mr Nichols confirmed, and, I think, in his evidence, made it clear that the reference should have been made to himself, and perhaps, in association with his father.
I don't consider that the present application faces any greater difficulties than that considered by Chesterman J in Cassie v Bogdan [2004] QSC 275, in which an admission of careless driving, which had been quite deliberately made, was allowed to be withdrawn on the basis that senior counsel subsequently briefed considered the matter and advised that the defendants might have an argument on that issue.
His Honour was aware of authorities such as Ridolfi v Regato Farms Pty Ltd [2001] 2 Queensland Reports 455, which concerned a trial Judge's refusal of an amendment sought to be made at trial withdrawing an admission. The Judge, at the same time, adjourned the trial. The matter went off to the Court of Appeal for review of the refusal of leave to withdraw the admission. The admission there, like the one here has been, at least until the 2nd of November this year, was applied for at a very late stage. Chesterman J, I think, correctly regarded the case as essentially one establishing:
"that the exercise of discretion by a Judge to allow or refuse to withdraw the admission would rarely be disturbed on appeal, because the discretion is broad and unfettered." See paragraph [26].
As I had suggested at today's callover, before having the advantage of being referred to this case, I was inclined to think that the governing principle, now that there is no longer a trial imminent, is that established by Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146, referred to in Cassie, in particular, at paragraph [27] where his Honour said that:
"It clearly subordinates the interests of efficiency and procedure to the interests of the judicial determination of disputes according to their merits."
As Mr Trotter, for the defendant, says, there's some support in the bill of costs rendered by the former solicitors for Mr Nichols' assertion that the pleadings contained in the admission went out without his having had any opportunity to see them; he may well not have understood them if he had seen them. Some of what he said is open to question. In particular, suggestions that the pleading had to be done urgently - as it appears the solicitors were actually brought in very soon after service of the claim and statement and claim.
I propose to accede to the application and make clear that the reason for my doing so is that there is no longer the factor which I had formerly thought was decisive of an impending trial in respect of which the plaintiff, at least, could be taken to have got himself ready at considerable trouble and expense. He, no doubt, did do that last September, but all of that effort has been wasted and we start again with a clean slate, so to speak, in that trial dates - if there ever are any - are now far off.
I think it is inescapable that the plaintiff has been induced to organise his affairs and plan things on the basis that he had the advantage of that useful admission - an advantage which he now loses. But there is time for him to regroup and I am sure it is not beyond the wit of the Court, assisted by representations from the parties' representatives - and his in particular - to devise ways of providing recompenses for any harm that there may ultimately be in due course.
The High Court's decision indicates that that is something usually attended to by costs orders.
...
HIS HONOUR: Leave to the defendants to withdraw the admission made of the allegation that the first defendant was acting on his own behalf, contained in paragraph 1.4 of the statement of claim.
...
HIS HONOUR: I order that the defendants pay the plaintiff's costs of today's application and the costs occasioned by withdrawal of the admission, to be assessed on the indemnity basis referred to in rule 704.
MR CHARRINGTON: Perhaps, your Honour, you made the order in terms of the defendants. I wonder if it should only be the first defendant, as it was the only party?
HIS HONOUR: Does that make any difference?
MR CHARRINGTON: Well, probably not. I just raised it as - it was the party-----
HIS HONOUR: Only the first defendant applied - all right. All right. I will make it the first defendant if that's what you want?
MR CHARRINGTON: Both, I'm sorry, your Honour.
HIS HONOUR: Might as well put both. If the counterclaim works the first defendant might be rich.
MR CHARRINGTON: Thank you, your Honour.
HIS HONOUR: Thanks, Mr Venville.
MR VENVILLE: Your Honour, just to clarify. The indemnity costs as being awarded on both the application of today and the costs thrown away - is that my understanding?
HIS HONOUR: Yes.
MR VENVILLE: That's correct? Thank you.