McMahon Clarke Legal (a firm) v Allen
[2010] QDC 323
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- Unreported Judgment
- McMahon Clarke Legal (a firm) v Allen[2010] QDC 323
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McMahon Clarke Legal (a firm) v Allen[2010] QDC 323
McMahon Clarke Legal (a firm) v Allen[2010] QDC 323
DISTRICT COURT OF QUEENSLAND
CITATION: | McMahon Clarke Legal (a firm) v Allen [2010] QDC 323 |
PARTIES: | MCMAHON CLARKE LEGAL (A FIRM) appellant V SCOTT FITZGERALD ALLEN respondent |
FILE NO/S: | BD3779/09 |
DIVISION: | Appellant |
PROCEEDING: | General Civil Appeal |
ORIGINATING COURT: | Magistrates Court at Brisbane |
DELIVERED ON: | 26 August 2010 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 19 August 2010 |
JUDGE: | Ryrie DCJ |
ORDER: |
|
CATCHWORDS: | APPEAL – DISMISSAL OF PROCEEDINGS – where the appellant commenced proceedings against the respondent to recover legal fees – where the appellant failed to file a reply in proceedings – where an application for leave to proceed under r.389 had been dismissed by the court in the first proceedings – where the first proceedings was dismissed by consent for want of prosecution – where the second proceedings filed was identical – where Magistrate dismissed those proceedings on the basis that it amounted to an abuse of process – whether Magistrate erred in finding an abuse of process Magistrates Court Act 1921, s 45 Uniform Civil Procedure Rules 1999, rules 5; 165(2); 166; 168; 280 & 389 Bendeich v Clout [2003] QDC 305, applied Birkett v James [1978] AC 297, applied House v The King (1936) 55 CLR 505, applied |
COUNSEL: | J Ratanatray for the appellant D de Jersey for the respondent |
SOLICITORS: | McMahon Clarke Legal for the appellant Irish Bentley Lawyers for the respondent |
Introduction
- [1]This is an appeal under s.45 of Magistrates Court Act 1921 against the decision of a magistrate made on the 2nd December 2009, dismissing a proceedings No. 8873/09 (‘second proceedings’) on the basis that it was an abuse of process.
Background
- [2]On the 20th December 2005, the appellant had commenced proceedings (‘first proceedings’ No 17482/05) against the respondent in the Magistrates Court to recover legal fees it alleges were outstanding under a client agreement. A notice of intention to defend and defence was filed by the respondent to that claim on 3rd February 2006. On the 13th June 2008, a summary judgment application brought by the appellant was dismissed however the respondent was ordered to file an amended defence to the claim. That amended defence was filed on 17th July 2006. Nothing further happened after that point until the 15th May 2009, at which time the appellant applied to the court for leave to proceed r.389(2) UCPR. That application was dismissed by the court. The respondent had cross applied to strike out those proceedings for want of prosecution under r.280 UCPR however by consent of both parties, the first proceedings were dismissed.
- [3]On the 22nd July 2009, the appellant then commenced the second proceedings against the respondent. The cause of action pleaded in those proceedings was exactly the same as that which had been pleaded in the first proceedings. On the 20th August 2009, a conditional notice of intention to defend was filed alleging an abuse of process. On the 3rd September 2009, the respondent also filed an amended application seeking an alternative order, that the second proceedings be dismissed for want of prosecution: r.280 UCPR.
The issues before the Magistrate on 2nd December 2009
- [4]The issues for the magistrate’s determination on the amended application before her were whether or not the second proceedings commenced on 22nd July 2009 ought to be dismissed either because it was an abuse of process or alternatively, because the proceedings ought to be dismissed for want of prosecution. The magistrate dismissed the alternative ground but determined that the commencement of the second proceedings amounted to an abuse of process. The magistrate set out her reasons in her ex tempore decision.
The issue argued on this appeal
- [5]The issue argued on the appeal was whether or not the second proceedings were correctly dismissed by the magistrate on the basis that it amounted to an abuse of process. Helpful oral and written submissions (exs 1 and 2) were provided by counsel appearing of behalf of the parties setting out their respective arguments. The notice of appeal filed 23rd December 2009 sets out the grounds upon which the appellant relies which are self explanatory and need not be repeated again.
- [6]In short, the argument advanced on the hearing of this appeal by the appellant was that the magistrate fell into error when she determined that the second proceedings amounted to an abuse of process. It was submitted that she had fallen into error as a consequence of her misunderstanding and excessive reliance on the effect of rules 165(2) and 168 UCPR as it related to the second proceedings without due regard being given by her to r.166(1) and r.5 philosophy.
- [7]Counsel argued that the only factor which the magistrate relied on when determining that there had been an abuse of process was her reliance upon those subject rules. Counsel submits that because the magistrate then erred in her application of them, this appeal ought to be allowed. In support of his submissions, counsel pointed to the various passages set out in the magistrate’s reasons which he says shows that the magistrate had dismissed certain other factors which had been advanced by the respondent for her consideration on the abuse of process application. He argued that fact is made clear particularly if regard is had to page 9 of those reasons. Those factors included any question of delay which had been occasioned by the appellant’s failure to litigate expeditiously in the first proceedings, the fact that the appellant was indeed a solicitor’s firm and even the fact that the claim itself would involve ‘word on word’ with respect to the extent or otherwise of any retainer under the relevant client agreement.
- [8]Counsel argued that the magistrate, having discounted all of those factors from her consideration, still fell into error notwithstanding, when she placed excessive reliance on the subject rules and/or misunderstood the true effect of them. Counsel submitted that the magistrate fell into error when she found that the effect of r. 165(2) and 168 respectively was to constrain the ability of the appellant to meet the respondent’s case on the first proceedings. Counsel submits that the magistrate failed to appreciate that any deemed non admission did not preclude the appellant from putting the respondent to proof on that part of the case which was positively pleaded and the subject of the non admission. He also argued that the magistrate failed to consider the true effect of any deemed non admissions (as a consequence of appellant not having filed a reply to the respondent’s amended defence) in any event, in that the primary issue to be determined between the parties at trial would principally turn on a question of construction of the subject client agreement for which any evidence likely to be called would be broadly unnecessary or irrelevant. Counsel also argued that the magistrate erred when she found that the appellant had ‘an unjustifiable advantage in litigation contrary to the earlier effect of the UCPR on the earlier litigation’.
- [9]Counsel for the respondent on the other hand argues that the magistrate did not fall into error as asserted. He argues that a fair reading of her decision clearly shows that she took into account three primary factors when determining that there had been an abuse of process. Counsel pointed to those reasons in support of his oral submissions namely page 6, 8, 9, 10 and 12. In particular, counsel referred to the magistrate’s statement on page 12 where she says at L10 “bearing in mind all the factors that I have outlined, particularly about the non admissions and the position the defendant would now find himself in those proceedings, I find that the current proceedings, the second proceedings are indeed vexatious as they give the plaintiff an unjustifiable advantage in litigation contrary to the earlier effect of the UCPR on the earlier litigation.”
- [10]Counsel argues that the magistrate correctly characterised the claim as an abuse of process following the orthodox rule from Birkett v James [1978] AC 297, particularly in light of the three factors which she took into account. At paragraph 8 of his written submission (ex 2), Counsel sets out his comprehensive argument on this point and submits that the magistrate correctly found that the combination of those factors identified by him in paragraph 8, and in particular subparagraph (c) supports the characterisation by the magistrate of the second proceedings as an exceptional one, a fact she recognised herself at page 12.
- [11]Counsel also referred to several case authorities in support of his submissions including Bendeich v Clout [2003] QDC 305 to demonstrate the more recent approach which the courts have consistently taken in respect of applications for leave to proceed and/or want of prosecution where there had been tardiness by solicitors to litigate claims expeditiously. He also referred to the obiter of McGill DCJ in Bendeich at para [57] as significant insofar as it sits comfortably with the modern approach which has more recently been taken by the courts with respect to the application of r.5 and the sanctions that the rules provide which now enable courts to impose upon litigants who do not proceed in an expeditious way.
The standard to be met on this appeal
- [12]In order for the appellant to succeed, it must be demonstrated that some error has been made in the exercise of the discretion by the magistrate: House v The King (1936) 55 CLR 505. That may be made out by the appellant either by showing that the judge acted upon a wrong principle, allowed extraneous or irrelevant matters to guide or affect her, that the judge made a mistake on the facts or did not take into account some material consideration. Only then should the determination be reviewed and this court may then exercise its own discretion in substitution.
- [13]Having carefully considered the submissions made on behalf of both parties and having reviewed all of the material available to me, I am not satisfied that the magistrate fell into error as asserted.
- [14]A careful reading of her ex tempore reasons, in my mind at least, shows that she did take into account several important factors in her consideration of whether the second proceedings amounted to an abuse of process. I cannot accept the appellant’s submission that she only took into account one factor, namely the subject rules of the UCPR in her consideration. Counsel’s reference to one passage in the magistrate’s reasons commencing at page 9 line 53 (set out at paragraph 13 in ex 1) cannot be read in isolation. Indeed, that passage must be read in its’ context particularly in light of the magistrate’s own statement in conclusion at page 12 line 10 ‘bearing in mind all the factors that I have just outlined…’.
- [15]I am also unable to accept counsel’s submission that the magistrate fell into error when considering the subject rules. Her reasons properly noted that the appellant would now be given an unfair advantage if the second proceedings were allowed to remain on foot. That advantage the magistrate properly observed was that although the appellant would have been subject to any deemed non-admissions in the first proceedings because of its’ failure in having filed a reply, it would not be under the same constraint now in the second proceedings. In that regard, the magistrate property took into account the position which the respondent would now find himself in if the second proceedings under those circumstances were allowed to continue. It is also clear from her reasons that she acknowledged that the appellant’s application for leave to proceed in the first proceedings were dismissed on the 15th May 2009 by the court, as a result of the appellant’s own failure to file a reply in almost three years (page 4 line 30, page 11 line 30), a decision which, from the chronology provided to this court as part of ex 1 was not appealed against by the appellant. Her reasons show that she carefully went through all of the factors that she considered were relevant as it related to this case, not only the long delay caused by the appellant which is a solicitor’s firm but significantly, the previous history of the litigation especially the earlier decision which had been made by the court where the appellant’s leave to proceed application had been denied. The magistrate also took into account that even though the appellant was entitled to commence its’ claim again as the limitation period was still running, the defendant would nevertheless be disadvantaged in the second proceedings because the appellant would now be proceed on exactly the same claim without constraint. It follows that I cannot accept the appellant’s submission that the magistrate therefore only relied on application of rules 165, 166 and 168 of the UCPR in her determination that the second proceedings amounted to an abuse of process.
- [16]I am also unable to accept the appellant’s submissions that the extent of the retainer agreed under the client agreement will be able to be simply resolved as a matter of construction on the face of the document. The magistrate properly recognised that a crucial issue which would need to be resolved at trial will be what was agreed between the respondent and those employed by the appellant (Mr Hamilton) as it related to the extent of that retainer and whether that agreement extended to all work done by the appellant including that on behalf of the respondent and his company or just for him alone (page 7). The magistrate simply recognised the obvious fact that the appellant, having not filed a reply in the first proceedings at the point at which they were dismissed by consent, would have therefore had difficulty at that point in refuting (by means of calling oral evidence) what the respondent asserted in paragraph 11 of his amended defence. Her statement to that effect does not mean that she did not understand or appreciate that the appellant would have still have be entitled to put the respondent to proof on that part of the case which was positively pleaded and the subject of any deemed non admissions. In this regard, the appellant referred this court to the affidavits already sworn by the respondent and Mr Hamilton respectively and says that any relevant recollection by the parties on this particular issue has already been reduced to writing. As such, he submits that any oral ‘contest’ now would be of little relevance. That submission does not, in my mind, go to the point. That issue is but only one factor which the magistrate properly took into account during her consideration of whether or not the second proceedings amounted to an abuse of process.
- [17]Counsel also submitted that the respondent would not be prejudiced in any event. He submits that the respondent in his own filed material doesn’t dispute there was in fact a client agreement, that he received certain work invoices from the appellant in respect of it, that he has paid some money towards those invoices and has even ‘answered’ those invoices in his own affidavit filed in the summary judgement application proceedings. I cannot accept those submissions. While it is true the respondent does not dispute there was a client agreement, he clearly put into issue as early as 17th July 2006 in his amended defence that the extent of any retainer under that agreement was in dispute. Any part payment by him and ‘answer’ made by him in any affidavit filed, in my mind, merely go to support his continued denial that the total amount invoiced for work performed under that agreement by the appellant was not solely attributable to him. While it appears that the magistrate did not place any great weight on the fire which had destroyed part of the company’s records (primarily because she couldn’t identify which documents had actually be destroyed), the fact deposed to by the respondent in his affidavit filed 6th November 2009 paragraph 9 remains the same. It is of some real significance that the respondent says that he no longer has access to most of his company’s records due to that fire, a relevant and material factor now particularly if the appellant is allowed to proceed with its’ claim at this time relying on its’ own documentation and the respondent is no longer is the same or similar position.
- [18]In any event, I am not persuaded that this appeal should be allowed. The factors the magistrate identifies in her reasons, also summarised at page 12 line 10 - 30 supports a conclusion that this case was an exceptional one for the purpose of the test laid down in Birkett v James. The magistrate was therefore entitled to exercise her discretion to dismiss the second proceedings as an abuse of process in all the circumstances. Her decision is also consistent with the more recent approach taken by the courts which are now more readily disposed to impose sanctions upon litigants who do not litigate their matters expeditiously: r.5 UCPR.
- [19]It follows then that the appeal ought to be dismissed.
New or further evidence sought to be led on the hearing of this appeal by the respondent
- [20]The admission or otherwise of this affidavit sworn by the respondent 20th April 2010 for the purpose of this appeal is no longer required.
Orders
- [21]I make the following orders:
- The appeal is dismissed.
- The appellant pay the respondent’s costs of this appeal to be assessed on a standard basis unless the parties have otherwise agreed.