Woollard v Looker Estates Pty Ltd
[2006] QDC 52
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- Unreported Judgment
- Woollard v Looker Estates Pty Ltd[2006] QDC 52
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Woollard v Looker Estates Pty Ltd[2006] QDC 52
Woollard v Looker Estates Pty Ltd[2006] QDC 52
DISTRICT COURT OF QUEENSLAND
CITATION: | Woollard v Looker Estates Pty Ltd and Ors [2006] QDC 052 |
PARTIES: | MICHAEL THOMAS WOOLLARD AND ROSE JOANNE WOOLLARD Plaintiffs v LOOKER ESTATES PTY LTD First Defendant AND JAY CHETTY Second Defendant AND WESTPAC BANKING CORPORATION Third Defendant AND VAUGHAN HENRY Fourth Defendant AND RICHARD EBBOTT AND CO Fifth Defendant AND ALAN McKERNAN Sixth Defendant AND JUXGOLD PTY LTD Seventh Defendant |
FILE NO/S: | BD4519/02 |
DIVISION: | |
PROCEEDING: | Application |
ORIGINATING COURT: | District Court, Brisbane |
DELIVERED ON: | 10 March 2006 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 9 February 2006 |
JUDGE: | McGill DCJ |
ORDER: | Decision to renew claim against the fifth defendant on 15 November 2005 set aside; service of the claim and statement of claim on the fifth defendant set aside; action against the fifth defendant dismissed; order plaintiffs to pay fifth defendant’s costs of the action including this application to be assessed. |
CATCHWORDS: | PRACTICE – Renewal of claim – whether another good reason to renew claim – desire to await outcome of other litigation – whether prejudice – renewal set aside. UCPR r 5(3), r 24(2), r 667(2)(a) and (b). |
COUNSEL: | R. G. Bain QC for the plaintiffs K. A. Barlow for the fifth defendant |
SOLICITORS: | Carter Capner for the plaintiffs Richard Ebbott and Co for the fifth defendant |
- [1]This is an application by the fifth defendant under rule 16 for a declaration that the claim has not been properly served, and for an order setting aside each or any of the decisions by the registrar to renew the claim made on 27 October 2003, 13 November 2004 and 15 November 2005. The claim was filed on 14 November 2002 but was not served on the fifth defendant until 17 November 2005.[1] In the meantime, on three occasions a deputy registrar renewed the claim for 12 months, on ex parte applications on behalf of the plaintiffs.
- [2]This application was heard in conjunction with similar applications by defendants in two other matters, Hansell v Mariner Bay Investments Pty Ltd & Ors, D610/03, and Black v Greenwich Financial Services Pty Ltd and Ors, D717/02. There were some similarities between the circumstances in all three actions, and the same solicitor had the carriage of all three actions on behalf of the respective plaintiffs.[2] She was cross-examined by counsel for the defendant[3], and by senior counsel for the applicant fourth defendant in Hansell. I have prepared separately full reasons in Hansell; I will not in these reasons repeat any discussion from that judgment which is also relevant here, and will concentrate on the differences between that case and the present.
Background
- [3]The amended statement of claim[4] alleged that on 16 November 1996 the plaintiffs signed a contract to purchase the property known as Lot 61 in Calamvale Gardens from the seventh defendant. It was alleged that the plaintiffs retained the fifth defendant to act as solicitors for the plaintiffs in relation to the contract, and that there were various breaches of the retainer by the solicitors. Ten particulars of breaches were alleged, most of which referred to an alleged failure of the defendant to advise in relation to certain aspects of the transaction which it was alleged were disadvantageous to the plaintiffs, but it was also alleged that there was a failure to give them certain advice as to what they could do “if they had concerns over the value of the investment property”, and a failure to disclose what was said to be knowledge that “a significant portion of the purchase price was usually paid by way of commission or marketing expense and that such portion was arguably not reflected in the actual value of the investment property”, or that a significant portion of their business was comprised of conveyancing work referred by one of the other defendants. It was alleged that as a result of the breaches the plaintiffs entered into the contract, and a mortgage to finance it, and incurred various costs, and that as a result they have suffered loss. It was alleged that the property was sold at a loss of $20,000 in November 2002. The total loss claimed in the action is $41,959. The claim was brought under section 82 or 87 of the Trade Practices Act, or for negligence, or for breach of contract.
The renewals
- [4]On 27 October 2003 a deputy registrar renewed the claim for a period of 12 months from 13 November 2003 pursuant to rule 24. That was done after an affidavit by the solicitor was filed the same day. The affidavit was in identical terms to the affidavit in Hansell filed on 14 January 2004, except that it correctly gave the date on which the claim was filed in the present action. Significantly, it included the assertion of an expectation that the three test cases identified in that affidavit “will be finalised some time towards the latter part of 2003”. By 24 October 2003[5] that expectation was decidedly optimistic, given that by that date all of the remaining time for civil trials in the District Court at Brisbane had already been occupied by other matters set down at the last call over for the year. Nevertheless, this may have been a mistake, another “typographical error” for 2004. The solicitor conceded under cross-examination that the statement in paragraph 6 was wrong, although she said that at the time she thought it was true: p. 44. The affidavit was subject to the same criticisms referred to in Hansell[6], and as in that case, although it was in many respects unsatisfactory and inappropriate, I am not persuaded that it was fraudulent.
- [5]On 2 November 2004 a deputy registrar renewed the claim for 12 months from 13 November 2004. That order was made following the filing on the previous day of a further affidavit from the solicitor. This affidavit was virtually identical to the affidavit sworn and filed by the solicitor on 27 January 2005 in Hansell, except that it expressed an expectation that the test cases will be finalised “some time towards the latter part of 2004”, which by 29 October 2004 was obviously not going to happen; again, this may have been a “typographical error”. The same considerations apply as in Hansell, and again I am not persuaded the affidavit was fraudulent.
- [6]On 15 November 2005 a deputy registrar renewed the claim for 12 months from 13 November 2005. The order was made following the filing on the same day of an affidavit by the solicitor. This affidavit was virtually identical to the affidavit filed on 1 November 2004, except that it disclosed that the action had been discontinued against the first, second and seventh defendants on 27 October 2005, and that it had been renewed on two previous occasions. The unrealistic expectation as to the trial in the identified “test cases” had been updated to 2005, which remained hopelessly unrealistic on 14 November 2005 when the affidavit was sworn. This regular error suggests that the process of seeking renewal of these claims was essentially a mechanical one, which received only superficial attention from the solicitor at the time. I suspect, though the matter was not dealt with in the evidence, that this is because similar applications were being made in many, if not most, of the other 800‑odd similar claims, the existence of which was referred to in the affidavits. Again, the same considerations apply and I am not persuaded that the affidavit was fraudulent.
Prejudice to the defendant
- [7]The person who actually did the work for the defendant is known and also is a defendant, the sixth defendant in the action, and he is apparently available to give evidence.[7] The defendant retains a copy of his conveyancing file in the matter, the original having been provided to the plaintiffs’ solicitors in May 2004. Apart from that file, however, the firm maintained another file termed the “control file” in respect of matters which were common to the development as a whole, and therefore all purchases within this particular development, Calamvale Gardens. The defendant said (and was not cross-examined) that he has records showing that that file was opened on 27 March 1995 and that “on that file, we kept documents such as body corporate searches, plans for the development and valuations.” He said that in respect of some developments copies of independent valuations would be provided to his firm, and when they were provided they were placed on the control file; he cannot now recall whether he received valuations in respect of properties in Calamvale Gardens. He is now unable to find the control file for this development, and believes that it has been destroyed in the ordinary course of his firm’s practice; evidently old files are destroyed from time to time when more space is needed for storage. He cannot say when the control file was destroyed, but obviously it may well have been after the claim was filed in November 2002. The last time a large number of old files were destroyed was in about February 2005.
- [8]He said that although he was given notice of an intention on the part of the plaintiffs’ solicitors to commence proceedings in respect of various other former clients, he was given no notice of any intention on the part of the plaintiffs to commence proceedings, nor any notice of the fact that the claim had been filed. This was not disputed. He was not aware of any other proceedings against his firm involving that particular development except for one other action.[8] Assuming that the other purchases in this development occurred around the same time as the present plaintiffs’, late 1996, one would expect the limitation period in respect of any such claim would have long since expired.
- [9]The solicitor deposed[9] to the existence of another action against the defendant arising in part out of the purchase of a property in Calamvale Gardens, filed in October 2001 and evidently served promptly because the defence by the defendant was filed on 9 December 2002; that plaintiff was represented by different solicitors. The statement of claim in that action, exhibited to the solicitor’s affidavit, says virtually nothing more about the claim against the defendant.
- [10]Presumably at some point the statement of claim was amended, as the defence which is exhibited is a defence to an amended statement of claim. It really is not possible to work out from that defence what the allegations currently made against the defendant are, or indeed were in 2002 when the defence was filed. The solicitor deposed to having ascertained that the matter was still continuing as at 22 September 2005 when someone filed an affidavit stating that the plaintiff wished to continue the proceeding against the defendant. It does not otherwise disclose what happened to the action between December 2002 and the filing of that affidavit. One wonders whether the answer is nothing, and that the affidavit was filed in support of an application for leave to proceed, and if so, what happened to the application.
- [11]In any case, the defendant has sworn[10] that he had forgotten about the existence of a control file for Calamvale Gardens until after he was served with the claim and he had a conversation with the sixth defendant, who formerly worked for him and who did the actual conveyancing. The sixth defendant informed him that he had created the control files to assist himself when acting for multiple purchasers in a complex. He was not named as a defendant in the other matter, and the defendant had not discussed the other matter with him. In the circumstances, the issue is not whether, from the point of view of the other proceedings and the parties to it, documents were destroyed which ought to have been retained. The issue is whether the defendant has in fact suffered prejudice which would not have been suffered had it not been for the delay of the plaintiffs in serving the present claim. In my opinion in the circumstances the defendant has suffered specific prejudice, because of the loss of the file which may well have been relevant to the matters raised in the present action, and which probably would not have been lost had the claim been served promptly, as it should have been.
- [12]Apart from this, there is prejudice arising in the ordinary way from the mere passage of time. Although to some extent the matters raised in this action depend on documentation, they also necessarily involve consideration of what advice was sought (orally) by the plaintiffs, and what advice was given orally by the sixth defendant on behalf of the defendant. I do not think that it can be said now that this is a case which will turn essentially or even largely on the content of the documents on the solicitor’s file. In other respects, the comments made in Hansell apply equally here. With regard to the possibility of prejudice arising from the loss of the opportunity to pursue claims for contribution and indemnity, my comments in Black apply equally here.
Defective service
- [13]On the last occasion when the claim was renewed the copy on the court file was stamped with the court seal to show it had been renewed for 12 months from 13 November 2005. The copy of it served on the defendant did not bear this seal, although it did have the two earlier seals.[11] On its face, therefore, the document which was served was stale, having expired on 13 November 2005, a few days earlier. I agree that it follows that the defendant was not properly served, not having been served with the original claim or a true copy of it: UCPR r. 22(3), r. 106. It follows that service was in this respect irregular. Nevertheless it was effective to bring the claim to the attention of the defendant, and as he said himself in his affidavit he then searched the court file.[12] From that file he would have ascertained that the claim had in fact been renewed shortly before he was served. In these circumstances the failure to serve a proper copy, though an irregularity, is not a matter of any great importance. If that were the only problem facing the plaintiffs, I would be willing to declare the service valid.
Analysis
- [14]The consideration referred to in Hansell, that the plaintiffs wrongly gave themselves a unilateral stay of the action by deliberately withholding service for an extended period of time, applies equally in the present case.[13] The fact that there was no notice of the proceeding is also clearly a relevant consideration, tending against renewal. The limitation period now having expired, I accept that if renewal is refused the plaintiffs will suffer the loss of any claim against the defendant. The claim presently pleaded is not one which is covered directly by the matters decided in Littler, nor is it one where it is apparent on the face of the pleadings or from other material before me that the plaintiffs have a strong case. Indeed, there is nothing in the material before me to suggest the plaintiffs have any substantial prospects, though no doubt the case is arguable. Nevertheless, I accept that the plaintiffs will suffer some serious prejudice if they lose the opportunity to pursue their claim, though the considerations qualifying this referred to in Hansell also apply. As to prejudice to the defendant, there is both specific prejudice arising from the apparent loss of potentially relevant documents on the control file relevant to the development as a whole, and the general prejudice which arises simply because of the considerable delay since the events giving rise to the claim occurred, as discussed in Hansell. Both of these in my opinion are matters of some significance.
- [15]In my opinion, for the reasons given in Hansell, and above, on the last occasion when the claim was renewed there was not good reason to renew the claim. The plaintiffs have not shown that there is good reason to exempt this proceeding from the general requirement of the rules that a claim be served within 12 months. Accordingly the decision of the deputy registrar of 15 November 2005 is set aside. It follows that service of the claim was irregular. In my opinion the claim ought not to be renewed, and it follows that that irregularity ought not now to be cured. In those circumstances, the appropriate course is to dismiss the plaintiffs’ action against the fifth defendant. The plaintiffs should pay the fifth defendant’s costs of the action and the application to be assessed; I am not concerned with who as between the plaintiffs and their solicitors should bear those costs, but will reserve leave to the fifth defendant to apply for an order for costs against the plaintiffs’ solicitors.
Footnotes
[1]Affidavit Ebbott filed 23 December 2005 para 2; affidavit of Teitzel filed 7 February 2006 para 8.
[2]It is convenient to refer to her as “the solicitor”.
[3]I shall refer to the fifth defendant as “the defendant”.
[4]Filed 24 January 2006 – the current pleading.
[5]When that affidavit was sworn.
[6]This case was slightly different, in that the third defendant was also a defendant in one of them, so that the parties were not completely different: p. 37.
[7]Affidavit of Ebbott filed 23 December 2005, for this paragraph and the next.
[8]Affidavit of Ebbott sworn 8 February 2006, correcting a drafting error in the affidavit filed 23 December which said there were no other proceedings (as was the case in Black).
[9]Affidavit of Teitzel filed 7 February 2006 paras 92-98.
[10]Affidavit of Ebbott sworn 8 February 2006 paras 12, 13.
[11]Affidavit of Ebbott filed 23 December 2005 Exhibit RE1
[12]Affidavit of Ebbott filed 23 December 2005 para 4.
[13]The solicitor effectively conceded under cross-examination that the attitude of the defendants to the unilateral stays was not considered: p. 38 line 25-29.