Webster v Westpac Banking Corporation
[2006] QDC 509
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- Unreported Judgment
- Webster v Westpac Banking Corporation[2006] QDC 509
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Webster v Westpac Banking Corporation[2006] QDC 509
Webster v Westpac Banking Corporation[2006] QDC 509
![Webster v Westpac Banking Corporation [2006] QDC 509](/judgmentview/image?name=316627.001.png&id=316627)
DISTRICT COURT OF QUEENSLAND
CITATION: | Webster v Westpac Banking Corporation [2006] QDC 509 |
PARTIES: | WILLIAM WEBSTER Plaintiff and WESTPAC BANKING CORPORATION Sixth Defendant |
FILE NO: | D5259 of 2001 |
PROCEEDING: | Application to set aside renewal of claim |
DELIVERED ON: | 06 November 2006 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 31 October 2006 |
JUDGE: | Judge Brabazon QC |
ORDER: | Set aside order renewing claim |
CATCHWORDS: | Adjournment |
COUNSEL: | Mr L Kelly SC and Mr D S Piggott for the Sixth Defendant Miss D Skennar for the Plaintiff |
SOLICITORS: | Mallesons Stephens Jaques for the defendant Hall Payne Lawyers for the plaintiff. |
The Issue
- [1]This claim was filed on 30 October 2001. It was not served within the 12 months allowed by the Rules. In October 2005, a Deputy Registrar of this Court renewed the claim up to 29 October 2006. That application was without notice to Westpac.
- [2]Should that order be set aside? Should this Court now make a different order?
The Renewal
- [3]In August 2005 application was made to the Registrar, to renew the claim of October 2001. No written application appears on the file. A lengthy affidavit by Mr Webster’s solicitor was filed.
- [4]The application was at first declined. In substance, a notation on the file says this:
“…Rule 24(2) of UCPR permits Registrar “to renew for further periods of not more than one year starting on the day after the claim would otherwise end.”
I consider that r 24(2) does not contemplate that the Registrar would make a series of renewals where more than two years has passed since filing of claim. See Gillies v Dibbetts 1999 QSC 161 at 37.
Please consider the above and supply written submissions within case law that authorises a series of renewals.”
- [5]The solicitors for Mr Webster responded by filing another affidavit – largely formal in its effect – and some written submissions.
- [6]The submissions correctly observed, that r 24(2) of the UCPR provides that a claim, more than 12 months old, may be renewed for “another good reason”, there being no reason why Westpac had not been served.
- [7]Reliance was placed on the facts set out in the solicitor’s affidavit. His affidavit showed that he had spoken to Westpac’s solicitor about this claim. He said that he was aware of many such claims against Westpac. That was during 2003.
- [8]Then, in July 2005, Mr Webster’s solicitor sent a copy of the claim and amended statement of claim direct to Westpac’s solicitors. Those pleadings, and some other documents, were sent “by way of service”. Westpac’s solicitors responded in a letter of 27 July 2005. Those solicitors observed that the proceedings did not appear to be in force as against Westpac. The letter went on – “please clarify the basis on which you are representing the proceedings to be extant as against our client”.
- [9]They received no reply to that letter.
- [10]If only because of the informal service of the papers, and Westpac’s solicitors query about the validity of that service, it was quite wrong for the Registrar to proceed ex parte. It is true that r 24 does not, in terms, require service on a defendant named in the claim. However, there will be many cases where justice demands that service be effected, before the application for renewal is heard. Service is required when there is a dispute between the parties, and a defendant’s position has to be taken into account. This is clearly one of those cases. To the same effect, see Gillies v Dibbetts [2001] 1 QDR 596 at 603.
- [11]That being so, this Court has jurisdiction to set aside the orders made by the Deputy Registrar, and may rehear the matter, on all the materials now available. See IMB Group Pty Ltd v ACCC [2006] QDC 407, MQF v Corry [2000] QDC 416, Dempsey v Hack [2005] QCA 34, Major v Australian Sports Commission [2001] QDC 320 and Hansell v Collision Finance Investments Pty Ltd [2006] QDC 054.
The History of the Claim
- [12]The plaintiff claims against eight defendants for negligence, breach of contract, breach of fiduciary duty and unconscionable conduct. The plaintiff’s solicitors act for many other such claimants, or potential claimants. All the claims arise out of the marketing of property in South East Queensland. It is said that the property was sold to Mr Webster at a price above its true value, and that Westpac, by its manager, played a role in that improper conduct. It is alleged here that the manager, Mr Caulley, made representations about the value of the property, in meetings with Mr Webster on 1 November 1995 and 16 February 1996. It is said that he wrongly told Mr Webster that a property was good value for money.
- [13]This claim was filed on 30 October 2001. In 2002, Mr Webster was contacted by Westpac and invited to participate in an internal procedure that was known as the Complaints Review Committee. Mr Webster declined to participate. He did not say to the Westpac representative that he had in fact commenced proceedings in this court.
- [14]It appears from Mr Truong’s affidavit that his firm’s strategy was to mount a number of “test cases”, while doing no more than filing a claim in other cases, such as this one. As he puts it in his affidavit:-
”Paragraph 13 – In view of the large number of claims and potential claims awaiting the outcome of the test cases, it is my belief that to pursue the claims other than the test cases will result in considerable costs being incurred and the unnecessary use of valuable court resources in circumstances where this might otherwise be avoided.”
- [15]Westpac became aware of these proceedings in June 2003, when its solicitors conducted a search of this Court’s Registry. That was then about 18 months after the expiry of the limitation period. There were further searches in 2004. In April 2004 Westpac obtained a copy of the statement of claim, which had been filed. Then, on 22 July 2005, there followed the informal service, set out above. Mr Webster’s solicitors then sought to have the claim renewed by the Deputy Registrar, in August 2005. There was then some correspondence between the solicitors, in which Westpac’s solicitors were not persuaded about the validity of the claim that had been served on them.
- [16]Almost four years passed between the filing of the claim and the application to renew it. The limitation period expired during that time. That time passed because of the solicitor’s strategy of only pursuing a selection of “test cases”.
- [17]It is now apparent that Mr Truong’s affidavit was not entirely accurate in describing the efforts to bring the “test cases” to trial. In para 7, he speaks of such a case which was filed on 30 October 2001. However, it is clear that he was confused, as that case is in fact this case, D5259 of 2001.
- [18]In para 8 he refers to another “test case” which was filed on 29 November 2002. However, in fact, that case which was brought by a Mr Kuhnert had been settled in May 2005.
- [19]In paragraph 9, he refers to other test cases, 11 in number, which had been served on various defendants. However, it was asserted here, without contradiction, that none of those defendants included Westpac. In fact, notices of discontinuance had been filed in a number of those cases.
- [20]Requests for trial dates had not been filed in any of the proceedings referred to as test cases. In many instances, no step involving filing court documents had occurred for over a year.
- [21]Overall, Mr Truong’s affidavit must have conveyed an inaccurate impression of the progress that had been made in the “test cases” so far.
Westpac’s Position
- [22]Westpac discovered the existence of the proceedings about seven and a half years after the events complained of. By the time it became aware of the precise nature of the proceedings, more than eight years had passed. It must have appeared to Westpac, and its solicitors, that Mr Webster was not proceeding with his claims against it. Westpac’s conduct has not been the cause of any of the delay.
- [23]As it happens, four of the corporate defendants to these proceedings have now been de-registered. There may be some potential prejudice to Westpac, as they are no longer available to be given a contribution notice by Westpac.
- [24]Otherwise, it is difficult to know precisely how much prejudice Westpac has suffered by the passing of time. Its manager, Mr Caully, is available but says he cannot remember meeting Mr Webster. That may be true, but it does not say much about his ability to remember the ways in which he dealt with applications for finance in this sort of case. It is not said that any of his records are missing. We do not know the extent to which he can recall, and be able to deal with, his practices in dealing with such customers at the time. However, as almost 11 years have now passed since the meeting in November 1995, there must be a real risk that his recall and understanding of events has been affected by the passing of time. It is very likely that Westpac has suffered some prejudice because of the passing of time.
The Discretion
- [25]This court has to exercise a discretion. The way that discretion might be exercised is illuminated by some recent decisions in this state. Renewal of a claim was refused in Muirhead v The Uniting Church in Australia Property Trust (Q) [1999] QCA 513. Matters to be considered included the length of delay, the reasons for it, the conduct of the parties and the hardship or prejudice caused to the plaintiff by refusing renewal, or to the defendant by granting it. It was pointed out that simply giving a plaintiff the opportunity to pursue an action, could never by itself amount to a “good reason” for renewing the claim. The Court of Appeal was particularly influenced by the fact that the limitation period had expired. As Williams J observed, there was really no justification for failing to give the defendant any notice at all before the expiry of the limitation period. On the facts, it was also found that the defendant would be prejudiced by the delay. Application for renewal was refused.
- [26]The Court of Appeal has recently considered an application to renew in IMB Group Pty Ltd and Ors v Australian Competition and Consumer Commission [2006] QSC 012.
- [27]The Court took into account the philosophy of the Uniform Civil Procedure Rules. The fundamental obligations of parties and the court could not be overlooked. As r 5 provides:
“5(i) The purpose of these rules is to facilitate the just and expeditious resolution of the real issues in civil proceedings at a minimum of expense below.
- (ii)Accordingly, these rules are to be applied by the courts with the objective of avoiding undue delay, expense and technicality and facilitating the purpose of these rules.
- (iii)In a proceeding in the court, a party impliedly undertakes to the court and to the other parties to proceed in an expeditious way.
- (iv)The court may impose appropriate sanctions if a party does not comply with these rules or an order of the court.”
The Court then found that the plaintiffs deliberately withheld service for five years, rather than comply with the ordinary timetable as to service of a claim, implicit in the UCPR. As the court put it at [21]…“by so doing they granted themselves a stay of their claim they may or may not have been granted had they applied to the court for it on notice to the defendant …instead of serving their claim timeously thus prohibiting the defendant to be heard in the court adjudicating upon an application for a stay, they chose to act in a way that precluded the defendants advancing any opposition it might legitimately have in such a stay…”
- [28]Taking into account all the facts, the Court of Appeal concluded that the claim should not be renewed. There was no good reason to accept the case from the general rule, that the court should not exercise its jurisdiction in favour of renewal. While that result was unfortunate for the plaintiffs, they had taken a deliberate course.
- [29]A similar approach was taken by Judge McGill of this court, in Hansell v Mariner Bay Investments Pty Ltd & Ors [2006] QDC 054. As he put it, from para (40):
“In my opinion the important consideration is that the renewal was prompted by a deliberate decision on the part of plaintiffs not to serve the claim, because of the unilateral adoption of an inappropriate approach to large scale litigation. … A party who has commenced proceedings is obliged to pursue them, and is not entitled to any concession under the rules because of any delay brought about by deliberate decision to reframe from pursuing them for some other reason, whether because it was thought sufficient just to carry on the action against another defendant, or to await the outcome of other proceedings between the parties…device in this approach is that it involves a unilateral interference by the plaintiffs with the ordinary processes of the court. It involves the plaintiffs giving themselves a stay, without the defendant having the opportunity to be heard about it.
(41) It may well be the case management of large scale litigation such as that of which this action is said by the solicitor to be a party is appropriate, but if that is to occur it should be undertaken by the court, not unilaterally by the plaintiff’s solicitors. …If test cases are to be run, they can be selected by the court after hearing submissions from all the relevant parties.
(42) In my opinion, the approach of the plaintiff’s solicitors in relation to this matter was fundamentally wrong. It was contrary to the well established principle which antedates the UPCR that proceedings ought to be served promptly once they have been issued, if that is possible. . It seems me that there was in this case a clear, indeed deliberate, breach of the plaintiff’s implied undertaking to the court to proceed in an expeditious way. …”
- [30]The orders of the court are these (subject to any further submissions by the parties) below:
- (a)Each of the orders made by the Deputy Registrar on 4, 5, 6 and 7 October 2005 to renew the claim against the sixth defendant be set aside.
- (b)Order that the claim against the sixth defendant be dismissed.
- (c)Order that the plaintiff pay the sixth defendant’s costs of the proceedings assessed on the standard basis.
Conclusion
It will be understood that this claim for renewal faces insuperable difficulties – the passing of the limitation period, an impermissible approach to “test cases”, prejudice to Westpac, delay, and the fact that no contemporary court decision supports a renewal in favour of a party who deliberately choses not to serve a claim, where that can be done. (In any event, the Deputy Registrar was wrong to progressively extend time on three successive days – Gillies v Dibbetts 1999 QSC 161 at (37)).