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- Unreported Judgment
DISTRICT COURT OF QUEENSLAND
Mr Naked Bean Pty Ltd v Frastil Pty Ltd  QDC 25
MR NAKED BEAN PTY LTD (ACN 600 150 758)
FRASTIL PTY LTD (ACN 142 987 880)
2617 of 2018
District Court, Brisbane
16 February 2021 (ex tempore)
16 February 2021
I order that the Application be dismissed.
APPLICATION IN PENDING PROCEEDING – where the plaintiff filed an Amended Statement of Claim in January 2020 – where the defendant filed an Amended Defence in March 2020 – where the plaintiff filed a Second Further Amended Statement of Claim in June 2020 – where the amendments did not relate to the third parties – where the defendant did not file third party notices within 28 days – whether there has been an adequate explanation for the delay – whether the issue of the third party proceedings is likely to add considerably to the complexity of the issues to be determined at trial and the length and cost of proceedings
Uniform Civil Procedure Rules 1999 (Qld), r 194
MGM Containers Pty Ltd v Wockner  QCA 502
D M Worrell for the applicant
New Era Lawyers for the applicant
QLS Law Group for the respondent
- This is an application pursuant to rule 194 of the Uniform Civil Procedure Rules 1999. The defendant seeks leave to issue two third party notices. It wants leave to issue the first third party notice on Mr Harrison Dennis in terms of a draft notice which is exhibit BL-6 to the affidavit of Brendan Leighton affirmed on 22 December 2020 and the second third party notice on Mr Daryl Robert Wells in the terms of a draft notice which is exhibit BL-11 to the affidavit of Brendan Leighton.
- Rule 194(1)(b) of the Uniform Civil Procedure Rules relevantly provides that, unless the Court gives leave, a third party notice must be filed either within 28 days after the time limited for the filing of the defence of the defendant who makes the third party claim, or the period agreed to where the plaintiff agrees to an extension of the prescribed period. There has been no period agreed to.
- The applicant defendant claims that the timeframe within which it was obliged to file any third-party notice was around early August 2020. It makes that assertion on the basis that a Second Further Amended Statement of Claim was filed on 3 June 2020. It then says that if you allow 28 days to file a defence and 28 days after that, one would expect that it had until about early August 2020 to file its third-party notices.
- MGM Containers Pty Ltd v Wockner  QCA 502 provides guidance on the principles governing leave to file third party proceedings. Relevant considerations are:
- (a)the extent of the delay by the defendant in bringing the application to join the third parties and whether that delay has been satisfactorily explained;
- (b)whether the issue of the third-party proceedings would unduly complicate the hearing of the action and whether it is likely to add considerably to the complexity of the issues to be determined at trial and the length and cost of proceedings;
- (c)whether it is still open to the defendant to bring separate proceedings against the proposed third parties and whether the issues that arise in the proposed third party proceedings are of a distinct nature from those relied on in the defence and not likely to be central to the existing proceedings; and
- (d)the stage which the existing proceedings have reached and the implications for the interest of justice if there be a further delay in finalising those proceedings.
- The applicant defendant submits that leave should be granted. It relies on the fact that the plaintiff only filed the Second Further Amended Statement of Claim on 3 June 2020. The applicant defendant submits that, while there has been a delay on the part of the defendant from the time the plaintiff filed its Second Further Amended Statement of Claim, the extent of the delay has been amplified as a result of the current COVID-19 pandemic. It submits that the delay was also caused by the failure of the plaintiff to comply with a costs order in a timely fashion and a reluctance on the part of the defendant to incur further costs at a time when it remained unclear as to whether the plaintiff would continue to prosecute the proceedings. With respect to those submissions, the defendant relies on the affidavit of Brendan Leighton
- On the issue of the complication that may be introduced to the proceedings, the defendant submits that the proceedings against the third parties are uncomplicated and unlikely to materially increase the length of the trial. It says that the proposed third parties are already, most likely to be witnesses in the proceedings between the plaintiff and the defendant. The defendant also says that the issues that relate to gas compliance and modification plates in the proceedings between the plaintiff and the defendant are the same as the issues raised in the third-party proceedings.
- All disclosure documents are said to be readily available, and, on that basis, it is submitted that granting leave is unlikely to cause substantial delay in respect of the current proceedings. The defendant also submits that the issues raised as between the defendant and each of the proposed third parties are uncomplicated and limited, and there is unlikely to be any delay in all parties proceeding to trial. In comparison, it says that it would suffer a significant detriment if it was required to bring separate proceedings against the third parties, considering the lack of complications associated with the claim.
- There is some force in the applicant’s final submission, but it should be recognised that applications of this nature call in to question two conflicting principles. As was observed by Justice Chesterman in MGM Containers Pty Ltd v Wockner  QCA 502, at paragraph 27:
“The applications called into question two conflicting principles. The first is that there are good reasons why a third party should be joined in an action where a defendant has an arguable case for contribution or indemnity from the third party against a plaintiff’s claim. Such a joinder ensures finality in litigation, avoids multiple proceedings with associated extra cost, and obviates the possibility that there might be different decisions given on the same issues if tried by different Courts. The second principle is that a plaintiff should be allowed to prosecute its action and obtain judgment without being delayed or inconvenienced by the defendant’s efforts to offset its liability. See Phonesivorabouth v Tops Services Pty Ltd  106 FLR 471.”
- Here, the defendant accepts that the existing proceedings have reached the stage where they are ready to proceed to trial. In my view, the delay has not been adequately or satisfactorily explained. Although a Second Further Amended Statement of Claim was filed on 3 June 2020, there were not amendments that concerned the issues of gas certification and modification certification. Those are the issues that relate to the third parties. Those issues were first raised in the Amended Statement of Claim filed on 29 January 2020. The defendant filed its Amended Defence on 24 March 2020, after the plaintiff had consented to extensions of the prescribed period for the filing of the Amended Defence. The defendant should have first been in a position to file third party notices within 28 days after 24 March 2020. The defendant elected not to do so at that time.
- The explanation for the delay is given in an affidavit of Brendan Leighton filed on 19 January 2021. In that affidavit, Mr Leighton asserts that the defendant was subject to financial difficulty and was unable to afford the cost of bringing the application and that the financial difficulty was exposed by current circumstances surrounding COVID-19. The delay is said to have been amplified as a result of the COVID-19 pandemic. Mr Leighton does not depose to the source of his belief about the defendant’s financial difficulties, nor provide any details whatsoever of the nature of that difficulty and its timing.
- The third-party claims could have been prepared contemporaneously with the Amended Defence, particularly as the defendant had been afforded an extension of time for the filing of that document. None of the further amendments made to the Statement of Claim after 29 January 2020 affected the issues raised by the plaintiff in the Amended Statement of Claim in respect of the gas certification and the modification certification. The plaintiff gave notice on 29 October 2020 of its intention to tender a request for trial date and suggested possible trial dates. The defendant responded on 9 November 2020 indicating that it intended to apply for leave to make third party claims against the individuals who were sub-contracted to certify the gas modification system and the modification plates.
- With respect to the potential complications arising from the issue of the third-party proceedings, I accept that there is likely to be a degree of overlap in the issues, but if the third parties are joined, the factual issues to be investigated at the trial will likely expand. For example, there will likely be a need to receive evidence about the contractual arrangements between the defendant and the third parties and whether there were implied terms in the contracts with each of the third parties. Even with the similarities between the issues, there is bound to be an expansion of the issues in dispute at the trial and evidence relevant to them if the third parties are joined. There will likely be an increase in the complexity and length of the trial, and consequently its cost.
- If the third parties become involved, it is likely that there will be delay to give them an opportunity to file Court documents, including pleadings, provide disclosure, and engage in other typical pre-trial steps. As I have already mentioned, the defendant accepts that this trial is otherwise ready to proceed.
- Accordingly, I do not consider that it is appropriate to grant the application, and I refuse to do so in the exercise of my discretion.
- Published Case Name:
Mr Naked Bean Pty Ltd v Frastil Pty Ltd
- Shortened Case Name:
Mr Naked Bean Pty Ltd v Frastil Pty Ltd
 QDC 25
16 Feb 2021