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Lillas & Loel Lawyers v Odlin[2022] QDC 107

Lillas & Loel Lawyers v Odlin[2022] QDC 107

DISTRICT COURT OF QUEENSLAND

CITATION:

Lillas & Loel Lawyers v Odlin [2022] QDC 107

PARTIES:

LILLAS & LOEL LAWYERS PTY LTD

(appellant)

v

CHRISTOPHER BRIAN CHARLES ODLIN

(respondent)

FILE NO/S:

D2375/21

DIVISION:

Civil

PROCEEDING:

Appeal

ORIGINATING COURT:

Magistrates Court at Brisbane

DELIVERED ON:

16 May 2022

DELIVERED AT:

District Court at Brisbane

HEARING DATE:

21 February 2021

JUDGES:

Sheridan DCJ

ORDER:

  1. Appeal allowed.
  2. The decision in the Magistrates Court dated 13 August 2021 be set aside.
  3. The appellant be granted leave under r 389(2) of the Uniform Civil Procedure Rules 1999 (Qld) to take a further step in the proceedings.
  4. The appellant file and serve any submissions as to costs of no more than four pages in length by 23 May 2022.
  5. The respondent file and serve any submissions as to costs of no more than four pages in length by 30 May 2022.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – UNIFORM CIVIL PROCEDURE RULES – APPEAL – LEAVE TO TAKE A STEP IN THE PROCEEDING – where there was a greater than two year delay during which no action was taken in the proceedings – where the appellant sought leave in the Magistrates Court under r 389 Uniform Civil Procedure Rules 1999 (Qld) to take a step in the proceedings – where leave was refused – where the appellant submits that the Magistrate acted on wrong principles, took into account irrelevant considerations and failed to take into account material considerations – whether the appeal should be allowed

LEGISLATION:

Legal Profession Act 2007 (Qld), s 308(c), s 315, s 316(1), s 316(2), s 341

Magistrates Court Act 1921 (Qld), s 45(1)(a)

Uniform Civil and Procedure Rules 1999 (Qld), r 5, r 149, r 157, r 165, r 166, r 167, r 168, r 169, r 389, r 765, r 766

CASES:

Australia Abalone World Pty Ltd v Yin [2020] QDC 190 followed

Dwyer v Calco Timbers Pty Ltd (2008) 234 CLR 124 cited

Fox v Percy [2003] 214 CLR 118 cited

Melco Engineering Pty Ltd v Eriez Magnetics Pty Ltd [2007] QSC 198 followed

Tyler v Custom Credit Corp Ltd & Ors [2000] QCA 178 followed

Scrivener v Director of Public Prosecutions [2001] QCA 454 cited

Allesch v Maunz [2000] 203 CLR 172 cited

The President’s Club Ltd v Palmer Coolum Resort Pty Ltd [2019] QSC 209 followed

Warren v Coombes [1979] 142 CLR 531 cited

COUNSEL:

P Sams for the appellant

A Moriarty for the respondent

SOLICITORS:

Lillas & Loel Lawyers for the appellant

AXM Law for the respondent

  1. [1]
    This is an appeal from the decision of the learned Magistrate refusing an application for leave to proceed pursuant to r 389 of the Uniform Civil Procedure Rules 1999 (Qld) (UCPR).

Background

  1. [2]
    The appellant was engaged by the respondent initially to act on his behalf in a claim against the Coordinator General (Qld). The appointment was extended to acting in a claim against his former lawyers and then to acting in a claim involving Queensland Rail.
  2. [3]
    The appellant gave each of the matters individual claim file numbers: 13-1649 (Coordinator General claim), 13-1652 (Biddle Lawyer claim) and 15-2013 (Q-Rail claim).
  3. [4]
    On or about 17 September 2013, a costs agreement and disclosure notice was entered in connection with the Coordinator General for the payment of compensation for the resumption of land.
  4. [5]
    A further costs agreement and disclosure notice was sent to the respondent on or about 17 September 2013 in connection with the Biddle Lawyer claim. In his amended defence, the respondent says that he signed and returned the second costs agreement on 26 September 2013.
  5. [6]
    Between September 2013 and November 2015, invoices totalling an amount of $160,410.67 were issued by the appellant to the respondent for services provided by the appellant or third parties. Amounts totalling $57,149.69 were paid to the appellant. An amount of $90,684.18 is alleged by the appellant to remain unpaid.
  6. [7]
    Proceedings were commenced by the appellant in relation to the amount outstanding on 15 March 2016. A defence was filed on 1 April 2016.  The statement of claim was first amended on 11 February 2018 and then further amended on 15 February 2019.  An amended defence was filed in response to the further amended statement of claim on 23 May 2019.
  7. [8]
    The further amended statement of claim relies on representations made by the respondent that he would “do all such acts and things to reciprocate assistance” given by the appellant to the respondent’s new solicitors in relation to settlement of the Coordinator General claim.  It was alleged the respondent had represented he would  promptly resolve his claim “for costs of such proceedings and promptly pay the amount properly due and owing to Lillas and Loel.”
  8. [9]
    It is alleged that the refusal to pay the further amount owing to the appellant following the settlement of the proceedings amounted to the respondent being unjustly enriched and/or that the respondent had acted unreasonably and unconscionably in applying the funds received to his own use and benefit and that the respondent is estopped from now denying his full indebtedness to the appellant.
  9. [10]
    In his defence, the respondent admits receipt of the invoices but disputes that all disbursements were validly incurred and says that work performed by the appellant and invoiced was performed without instructions, is the subject of a complaint to the Legal Services Commissioner, was of a standard below what was expected and was not carried out in an expeditious manner in accordance with instructions.
  10. [11]
    The respondent further says that of the monies paid to the appellant, payments totalling $15,000 were paid from monies disbursed from the trust account without his authority.
  11. [12]
    The respondent says that he has failed to make payment of the amount alleged to be owed, as the debt is not owed by the respondent.
  12. [13]
    The respondent says that all the allegations in the further amended statement of claim in relation to the making of representations are liable to be struck out as being embarrassing because they are vague, unintelligible and lack any particularisation.
  13. [14]
    The respondent further alleged in his amended defence that in respect of each of the Coordinator General claim and the Biddle Lawyer claim, the appellant breached s 308(c) and s 315 of the Legal Profession Act 2007 (Qld) (LPA) by failing to provide cost estimates as required by the LPA and by failing to disclose that the cost estimates provided had substantially changed, despite becoming aware of those changes and that, by reason of those breaches, the respondent was not liable to pay any of the invoices pursuant to s 316(1) of the LPA and the appellant may not maintain the proceedings pursuant to s 316(2) of the LPA.  It was alleged that as a result the proceedings are liable to be dismissed or permanently stayed and that their maintenance is an abuse of process.
  14. [15]
    On 21 May 2021, the appellant filed an application seeking an order for the assessment of its costs.  Prior to the filing of the application, the last step taken in the proceedings was on 23 May 2019, with the filing of the amended defence.  On the hearing of the application, given the failure for any step to have been taken, the appellant accepted that an adjournment of the application was necessary in order for it to bring an application for leave to proceed.

Decision at First Instance

  1. [16]
    In considering an application for leave to proceed under r 389 of the UCPR, the learned Magistrate said that it had long been held that the principle authority was that of Atkinson J in Tyler v Custom Credit Corp and Ors[1] where her Honour set out the 12 criteria for consideration of the court.
  2. [17]
    In her judgment, Atkinson J stated that there were a number of factors to be included in considering whether leave to proceed should be granted.  Her Honour stated:

“These include:

  1. how long ago the events alleged in the statement of claim occurred and what delay there was before the litigation was commenced;
  2. how long ago the litigation was commenced or cause of action added;
  3. what prospects the plaintiff has of success in the action;
  4. whether or not there has been disobedience of Court orders or directions;
  5. whether or not the litigation has been characterised by periods of delay;
  6. whether the delay is attributable to the plaintiff, the defendant or both the plaintiff and the defendant;
  7. whether or not the impecuniosity of the plaintiff has been responsible for the pace of the litigation and whether the defendant is responsible for the plaintiff’s impecuniosity;
  8. whether the litigation between the parties would be concluded by the striking out of the plaintiff’s claim;
  9. how far the litigation has progressed;
  10. whether or not the delay has been caused by the plaintiff’s lawyer being dilatory. Such dilatoriness will not necessarily be sheeted home to the client but it may be. Delay for which an applicant for leave to proceed is responsible is regarded as more difficult to explain than belay by his or her legal advisors;
  11. whether there is a satisfactory explanation for the delay; and
  12. whether or not the delay has resulted in prejudice to the defendant leading to an inability to ensure a fair trial.”
  1. [18]
    The Magistrate stated that, before going to the 12 criteria, there were two more recent authorities, The President’s Club Limited & Anor v Palmer Coolum Resort Pty Ltd[2]  and Australia Abalone World Pty Ltd v Yin,[3] to be noted. In referring to the recent authorities, the Magistrate quoted the comments made by Wilson J in The President’s Club where her Honour said:

“The court has a discretion which is not fettered by rigid rules but rather should take into account all relevant circumstances. It is noted that the relevant circumstances of some cases may require consideration of factors additional to the above twelve factors and/or render some of the twelve factors of such neutral significance as to not require discussion of them.

It is recognised that reasonable excuse for the delay is not a condition precedent to a grant of leave to proceed and a greater focus is placed upon the existence of material prejudice to the other party by permitting the action to proceed.

The first plaintiff, in this application for leave to proceed, must “show that there is good reason for excepting the particular proceedings from the general prohibition” in a case in which nearly six years have elapsed from the time when the last step was taken.”

  1. [19]
    In referring to the decision of Judge Barlow QC of this court in Abalone, the Magistrate quoted the statement of his Honour that:

“The real issue that I must consider is whether, notwithstanding the long and inexcusable delays that lie at the feet of the plaintiff, it would still be possible to conduct a fair trial of the proceeding. That depends substantially on any prejudice to the defendants if the matter were to proceed, balanced against the clear prejudice to the plaintiff if it were to be dismissed.”

  1. [20]
    The learned Magistrate then noted that there had not simply been one delay, referring to the fact that no step had been taken for two years, but commented that it was an unfortunate position that the proceedings have been “plagued with periods of delay.”
  2. [21]
    The learned Magistrate referred to the filing of the statement of claim in March 2016, the prompt filing of the defence in April 2016, the request for further and better particulars and the making of an application to the court, and then what appears to be a delay from June 2016 to January 2018.
  3. [22]
    The Magistrate identified three distinct periods of delay.  In discussing the first delay, the delay between June 2016 to January 2018, the Magistrate referred to the second affidavit of Mr Loel where he said Mr Loel explained the reason for it, or as the Magistrate described it, the alleged reason for it.  In referring to that affidavit, the Magistrate said Mr Loel referred to certain other matters with regards to proceedings involving the respondent. The Magistrate concluded that Mr Loel did not deal with why, during that period, the appellant did not proceed with an assessment of its costs as required to do so by the LPA.
  4. [23]
    The second delay described by the Magistrate was the period from February 2018, with the filing of an amended statement of claim, until the filing of a further amended statement of claim in February 2019. The Magistrate said the plaintiff referred to his having ceased practice as a lawyer between June 2018 to November 2020, which the Magistrate observed was due to Mr Loel’s practicing certificate being suspended. The Magistrate noted that right in the middle of that period there was a further amended statement of claim filed in the proceedings in 2019 and concluded that Mr Loel not practicing was not a reason for not progressing the matter.
  1. [24]
    The final delay referred to was in the period from 23 May 2019, when the amended defence was filed, noting the filing of non-party disclosure in June 2019, and then the delay until the application on 21 May 2021. The Magistrate said that there had been no proper reason for the further delay between December 2020, when Mr Loel says he returned to practice, and May 2021.
  2. [25]
    The learned Magistrate concluded that it is quite clear that the delays in the proceedings have been as a result of the appellant’s failure to progress the proceedings. The Magistrate further concluded that the allegations raised in the further amended defence would require a reply and there has been no reply filed by the appellant. The Magistrate noted that indeed the affidavit of Mr Loel, makes clear that the appellant intends to file yet another amended statement of claim. The learned Magistrate commented that it is now August 2021 and the appellant first initiated proceedings in March 2016, some five years ago, and noted that the invoices were issued in 2015 and earlier.
  3. [26]
    The Magistrate referred to r 5 and said that the failure of the appellant, being a law firm, to expeditiously proceed with the proceedings is a failure to comply with r 5.
  4. [27]
    The Magistrate then proceeded to deal with each of the 12 criteria.  The Magistrate mentioned each criteria and discussed in more detail criteria three, four, five and nine.
  5. [28]
    In addressing criteria three, in terms of the prospects of success, the Magistrate referred to the submissions of the respondent that s 316 and s 341 of the LPA means that the original bringing of the proceedings was an abuse of process and because of the failure of the appellant to have had its costs assessed, prior to the proceedings being issued, and having been made aware of the failure in the amended defence, meant that the proceedings could not be maintained.
  6. [29]
    The Magistrate then referred to criteria number four, whether there had been disobedience of court orders, and referred to the failure by the appellant, as evidenced by the affidavit of the respondent, to pay the respondent’s costs of the adjournment of the application in the sum of $500, despite demand having been made. The Magistrate noted that “for whatever reason,” despite that demand, the payment of the $500 remains outstanding. The Magistrate noted that a cheque had been raised in favour of the respondent’s solicitors, commenting that a copy of the cheque was annexed to one of the affidavits of Mr Loel, but commented that it had not yet reached the respondent’s solicitors, despite the demand that it be paid by 6 August 2021.
  7. [30]
    In referring to criteria number five, whether or not the litigation has been characterised by periods of delay, and criteria six, whether the delay is attributed to the plaintiff, the defendant or both, the Magistrate commented that the delay is attributable solely to the appellant solicitors that have failed to progress its claim appropriately in accordance with the provisions of r 5.
  8. [31]
    The Magistrate then referred to criteria number nine, how far the litigation has progressed, and noted that despite the litigation having been issued in March 2016, it is the appellant’s position that they will be seeking, yet again, to file another amended statement of claim. The Magistrate commented that “I find that extraordinary that some five years after the proceedings have been issued [indistinct] still trying to get its house in order with regards to properly seeking the relief.”
  9. [32]
    The Magistrate referred to the affidavit of Mr Odlin and referred in particular to paragraphs 13 and 14 of the affidavit which stated as follows:

“I am old and retired and my only source of income is the aged pension. These proceedings have been hanging over my head for 5 years and 5 months, since March 2016. It is only thanks to the charity of my sister that I have been able to afford for Mr Moriarty to represent me, which he has done and continues to do, at a discount on his usual fees.

The proceedings have caused me stress, anxiety and many sleepless nights, worrying about them, Mr Loel’s conduct and treatment of me and his claims, and they have placed significant emotional and financial strain on me and my sister and on our relationship.”

  1. [33]
    The learned Magistrate concluded “I consider that to be prejudice suffered by, suffered or suffering of the defendant as a result of the plaintiff’s failure to properly progress its claim and statement of claim.”
  2. [34]
    The Magistrate then referred to the statements by Judge Barlow QC in Abalone and concluded, “I consider that there is substantial prejudice on the defendant if the matter was to proceed. And I consider that greater as against the prejudice of the plaintiff, if it was granted leave to proceed.”  The Magistrate stated, “So having found that, I dismiss the application for leave to proceed.”

Mode of Appeal

  1. [35]
    Pursuant to s 45(1)(a) of the Magistrates Court Act 1921 (Qld), any party who is dissatisfied with a judgment or an order of a Magistrates Court, in an action in which the amount involved is more than the minor civil dispute limit, [4] may appeal to the District Court as prescribed by the rules.  It is accepted that, as this appeal involves an action for an amount of more than the minor civil dispute limit, the appellant is entitled to appeal to this court as of right.
  2. [36]
    On an appeal from the Magistrates Court, the District Court has the same powers as the Court of Appeal has to hear the appeal.[5]   Pursuant to r 765(1) of the UCPR, the appeal is by way of rehearing.
  3. [37]
    For an appeal by way of rehearing:

"the powers of the appellate court are exercisable only where the appellant can demonstrate that, having regard to all the evidence now before the appellate court, the order that is the subject of the appeal is the result of some legal, factual or discretionary error.”[6]

  1. [38]
    The rehearing requires this Court to conduct a real review of the record of proceedings below, rather than a complete fresh hearing.[7]  The appeal court is required to review the evidence and make up its own mind about the case.[8] 
  2. [39]
    Its function is to consider each of the grounds of appeal having regard to the evidence and determine for itself the facts of the case and the legal consequences that follow from such findings.

Grounds of Appeal

  1. [40]
    The appellant, in its notice of appeal filed 10 September 2021, appealed against the whole of the decision of the learned Magistrate.  The grounds of appeal relied upon in the notice of appeal were as follows:
  1. The learned Magistrate acted upon the wrong principle as:
  1. (a)
    The Magistrate found that a reply was required to have been filed;
  1. (b)
    The Magistrate treated the allegations raised in the defence as having been admitted, when they were subject to a non-admission pursuant to r 168 of the UCPR;
  1. (c)
    The Magistrate did not consider whether any prejudice to the defendant caused by the delay was of a kind which would lead to an inability to ensure a fair trial.
  1. The learned Magistrate allowed extraneous or irrelevant matters to guide or affect him, including:
  1. (a)
    The affidavits relied upon below were re-sworn prior to the hearing of the application;
  1. (b)
    The fact that the plaintiff was seeking to amend its statement of claim without having regard to the nature of the amendments proposed; 
  1. (c)
    The timing of the payment of a previous costs order.
  1. The learned Magistrate failed to take proper account of material considerations, including:
  1. (a)
    The plaintiff’s prospects of success;
  1. (b)
    The defendant’s inaction in the proceeding;
  1. (c)
    The defendant’s conduct in disbursing settlement funds it had received without attending to payment of its legal fees;
  1. (d)
    The prejudice to the plaintiff if leave was not granted for the plaintiff to take a step in the proceeding;
  1. (e)
    Whether the delay which had occurred meant a fair trial could not be conducted.

Acting on wrong principles

The reply

  1. [41]
    In the appeal, it was submitted that the learned Magistrate wrongly concluded that a reply was required to be filed, and the appellant having failed to do so, the Magistrate treated the allegation in the defence as having been admitted or, that it would be, at least determined in favour of the respondent.
  2. [42]
    In giving his reasons, the learned Magistrate proceeded on the basis that the appellant was required to obtain an assessment of its costs under the LPA. No explicit reasons were stated in the judgment for that conclusion.
  1. [43]
    However, I accept that the inference from the reasons is that the Magistrate considered that the appellant’s failure to file a reply to the allegations in the defence amounted to an admission that the appellant had failed to provide an estimate of total legal costs (not just professional fees), failed to provide an explanation of the major variables that might affect the calculation of legal costs and failed to disclose to the respondent that the estimate of costs had substantially changed, and hence that the appellant was in breach of s 308(c) and s 315 of the LPA and, as a result, could not maintain the proceedings.
  2. [44]
    The obvious response to these allegations, if the factual allegations about the costs disclosure letter and the failure to provide new ones were true, would be for the appellant to apply to have his costs assessed.  This is what the appellant ultimately did by the application filed 21 May 2021. 
  3. [45]
    The appellant did not, however, file a reply. The appellant relied upon r 168(1) of the UCPR which provides that:

“Every allegation made in the last pleading filed and served before the pleadings close is taken to be the subject of a non-admission and rule 165(2) then applies.”

  1. [46]
    Rule 169 provides that:

“The pleadings in a proceeding close –

  1. (a)
    If a pleading is served after the defence or answer to a counter-claim – on service of the pleading; or
  2. (b)
    Otherwise – 14 days after service of the defence.”
  1. [47]
    Rule 165(2) provides:

“A party who pleads a non-admission may not give or call evidence in relation to a fact not admitted, unless the evidence relates to another part of the party’s pleading.”

  1. [48]
    Leaving aside the late application for a costs assessment, it was submitted, in effect, that the appellant was entitled to put the respondent to proof of the factual allegations.
  2. [49]
    The submission made on behalf of the appellant might be thought to have some support in r 168 and r 169.  It would be consistent with the previous District Court Rules.[9]
  3. [50]
    This construction, however, would not be consistent with the current rules read as a whole.  The effect of r 5, r 149, r 157, r 165, r 166 and r 167 of the UCPR is to require a party to set out the whole of its case and restricts the ability of a party to reserve its position.  This is made particularly evident by r 166, which relevantly provides as follows:

“166 Denials and nonadmissions

  1. (1)
    An allegation of fact made by a party in a pleading is taken to be admitted by an opposite party required to plead to the pleading unless—

(a)  the allegation is denied or stated to be not admitted by the opposite party in a pleading; or

  1. (b)
    rule 168 applies.

…

  1. (3)
    A party may plead a non-admission only if—
  1. (a)
    the party has made inquiries to find out whether the allegation is true or untrue; and
  1. (b)
    the inquiries for an allegation are reasonable having regard to the time limited for filing and serving the defence or other pleading in which the denial or non-admission of the allegation is contained; and
  1. (c)
    the party remains uncertain as to the truth or falsity of the allegation.

(4)  A party’s denial or non-admission of an allegation of fact must be accompanied by a direct explanation for the party’s belief that the allegation is untrue or cannot be admitted.

  1. (5)
    If a party’s denial or non-admission of an allegation does not comply with subrule (4), the party is taken to have admitted the allegation.
  1. (6)
    A party making a non-admission remains obliged to make any further inquiries that may become reasonable and, if the results of the inquiries make possible the admission or denial of an allegation, to amend the pleading appropriately.

…”

  1. [51]
    It is unlikely that a party can avoid the obligations imposed by r 166(3) by simply failing to plead to allegations made in a defence.  It is more likely that r 168 is intended to deal with the situation where no positive allegations are made in a defence and to avoid any need to re-state the party’s position in a reply and to avoid a defendant having to respond to allegations in the reply, particularly given the specific absence in the UCPR of any provision for a rejoinder.[10]  If new matters are raised in the defence, the plaintiff ought to respond to them.  This view is consistent with that expressed by Dutney J in Melco Engineering Pty Ltd v Eriez Magnetics Pty Ltd.[11]
  2. [52]
    Ultimately, if the allegations in the defence were to be non-admitted, in my view the appellant was required to undertake the steps referred to in r 166(3) and then plead as implicitly required by r 166(1) in the form explicitly required by r 166(4) and (5).  The learned Magistrate made no error in this regard.
  3. [53]
    How far this conclusion matters is unclear.
  4. [54]
    The real issue is how far an assessment of costs was required by the pleadings affects prospects; being the third factor referred to by Atkinson J in Tyler.
  5. [55]
    At the time of the hearing before the Magistrate there was extant an application in these proceedings for the appellant’s costs to be assessed. That application had been filed two days before the expiry of the two-year period referred to in r 389, but not heard. It had been listed for hearing on 21 June 2021, but, at the request of the respondent, adjourned until 9 July 2021. It was adjourned on that date at the request of the appellant so that the appellant could make the application to take a step in these proceedings.
  6. [56]
    If an order for an assessment was made and the costs are assessed for some amount, the defence that the appellant could not maintain the proceedings would be rendered nugatory. Both assumptions depend upon leave being granted, but the fact remains that these are not proceedings where it would be possible to conclude that prospects were so poor as not to warrant leave being granted, and the Magistrate made no such finding in any event.
  7. [57]
    The Magistrate was entitled to have regard to the absence of a reply and the lateness of the appellant in filing the application for an assessment in considering the overall conduct of the appellant and in ultimately determining whether leave to proceed should be granted.
  8. [58]
    No error of principle in relation to the Magistrate’s view about the absence of the reply is demonstrated.

Admission of new evidence

  1. [59]
    At the commencement of the appeal, the respondent sought leave to file and serve an affidavit which exhibited the two costs agreements referred to in the statement of claim and a third costs agreement which was referred to in the defence, another copy of a letter which had been exhibited in an affidavit in the proceedings below and a copy of an e-courts file summary of the proceedings, the subject of one of the cost letters.  The respondent also swore that he had received and returned both of the costs agreements referred to in the statement of claim, and recited parts of the contents of all of the documents.
  2. [60]
    Extensive written and oral submissions were made as to the receivability given the interplay between r 766(1)(c) and r 766(2); the ambit of which provisions McPherson JA in Scrivener v DPP regarded as “perhaps not all together clear.”[12] The respondent submitted that the affidavit was relevant to prove the truth of the factual allegations in the defence that the claim could not be maintained (implicitly absent a costs assessment) and to prove the facts the subject of the deemed admissions.
  3. [61]
    In my view, these matters are not relevant to the appeal against the Magistrate’s decision; particularly having regard to my conclusions on the subject of the deemed admissions and prospects.  It is accordingly not necessary to decide whether or not the Court should receive the evidence on special grounds (as referred to in r 766(1)(c)), or whether it could be received without special leave unless the appeal could be regarded as one from a final judgment (as referred to in r 766(2)).  The application to adduce the further evidence is refused.

Prejudice and Fair Trial

  1. [62]
    The focus of the oral submissions on appeal was the learned Magistrate’s approach to the determination of the question of prejudice.  It was submitted by the appellant that the Magistrate failed to address the question of whether the prejudice which he identified was of a kind that would lead to an inability to ensure a fair trial.
  2. [63]
    The evidence of prejudice asserted by the respondent, and relied on by the Magistrate, was that the respondent is old and retired with proceedings hanging over his head, the proceedings have caused him stress, anxiety and sleepless nights and he is suffering financial and emotional strain.
  3. [64]
    The Magistrate considered that this was the prejudice suffered by the respondent as a result of the appellant’s failure to progress the claim.  The Magistrate did say that the real issue here to consider was whether it would be possible notwithstanding the delays to conduct a fair trial, but said that this substantially depended on the prejudice to the respondent.  The Magistrate found that there is substantial prejudice to the respondent if the matter was to proceed and that prejudice is greater than that which will be suffered by the appellant.
  4. [65]
    It is not clear how the Magistrate reached the latter conclusion.  If no step was allowed in the proceedings and the proceedings were thereby in effect stayed, on its face the appellant would be left with no means of redress; the proceedings being based on invoices issued between 2013 and 2015.
  5. [66]
    But it is clear from the terms of the reasons that no consideration was given by the learned Magistrate as to whether the delay would affect the ability of the respondent to conduct or to have a fair trial.
  6. [67]
    It is well accepted that the passage of time makes it more difficult to prove facts; memories fade and witnesses may be unavailable or incapable of testifying, and the parties may not know or be able to demonstrate the prejudice caused by the passage of time.[13]
  7. [68]
    These matters explain the rule which requires parties to proceed with expedition, and r 389 itself.  The real issue, in so far as applications under r 389 are concerned, as stated by Atkinson J, is “whether or not the delay has resulted in prejudice to the defendant leading to an inability to ensure a fair trial”;[14] not whether there has been prejudice to the defendant per se.
  8. [69]
    The appeal should be upheld insofar as it is submitted that the learned Magistrate acted upon the wrong principle in this regard.
  9. [70]
    A related submission by the appellant was that the learned Magistrate also erred in failing to take into account whether the delay which had occurred meant a fair trial could not be conducted.
  10. [71]
    Clearly this issue was not considered by the Magistrate, and this ground should also be upheld.
  11. [72]
    There was no evidence before the Magistrate (nor me), nor was any submission made that any witness was not available, that any witness was incapable of testifying, that documents had been lost or destroyed or that for some other tangible reason a fair trial could not be had.
  12. [73]
    In short, there was no evidence to suggest that a fair trial would now not be possible.

Irrelevant Considerations

  1. [74]
    It was submitted that the learned Magistrate had allowed three extraneous matters to affect his decision.
  2. [75]
    The first matter affected the reference at the start of the judgment to the fact that the affidavits relied upon by the appellant had to be re-sworn, and his expression of concern that a partner in a law firm had his affidavits sworn by someone he knew to be a law clerk, but who witnessed them as a lawyer.
  3. [76]
    It is clear from a fair reading of the reasons, however, that all the Magistrate was doing in referring to the re-sworn affidavits, was reciting the evidence before him. As to his expression of concern, the Magistrate specifically said that he would not take that matter further. There is no indication that he allowed these matters to affect his ultimate decision.
  4. [77]
    Even if he had done so, it is not clear that they are irrelevant to whether the appellant should be allowed to proceed. They reflect an element of tardiness and carelessness; and are reflective of a general approach in failing to properly attend to the proceedings in a way required by the rules.
  5. [78]
    The second matter relates to the Magistrate’s comments that the appellant was seeking to amend its statement of claim. The appellant contended that this was irrelevant absent some consideration being given to the nature of the amendments. In relation to the latter, it was submitted that the proposed amendments only deleted some allegations and did not contemplate any change to the relief and would have the effect of simplifying the proceedings.
  6. [79]
    The draft amendments would have the affect suggested, and that is a positive step. This does not alter the fact that it involves another step in the proceedings, and is demonstrative of the tardiness with which the appellant treated its claim. The Magistrate was justified in being critical of the appellant for taking some five years to “get its house in order.” This matter is not irrelevant to a consideration of whether the appellant should be granted leave to proceed.
  7. [80]
    The third matter which was the subject of comment by the Magistrate involved the failure of the appellant to pay the costs of $500 ordered to be paid by it in respect to the adjournment of its application that its costs be assessed. This statement was made in the context of the learned Magistrate’s consideration of the so called fourth criterion, namely whether there had been disobedience to any court order.
  1. [81]
    Whilst it is not necessarily clear that this was the type of order referred to in Tyler, the absence of the payment accompanied by the contention that a cheque had been drawn and was in the process of being delivered is further evidence of the tardiness of the appellant generally and of the way the appellant had treated its obligations to the respondent. It is, in my view, a relevant matter to consider in the exercise of the discretion.
  2. [82]
    The second ground fails.

Material Considerations

  1. [83]
    The third ground of appeal is that the learned Magistrate failed to take into account five material considerations. I have already dealt with three of these: the appellant’s prospects of success, the prejudice to the appellant if leave were not granted and whether the delay would mean a fair trial could not be conducted. That leaves two remaining matters: the respondent’s inaction in the proceedings and the respondent’s conduct in dispersing settlement funds without attending to the payment of fees.
  2. [84]
    Except making the finding that the whole of the delay was attributable to the appellant, the Magistrate did not mention either of these matters in his reasons. In the appellant’s submissions, reliance was placed upon the respondent foreshadowing in his defence that he would apply to dismiss or stay the proceedings and then did nothing.
  3. [85]
    There will be circumstances where inaction on the part of a defendant, or where the defendant’s delay in doing nothing, will be important considerations in the context of r 389. Apart from the item mentioned in the submissions, however, nothing else was said in support of the proposition that the Magistrate’s discretion erred in his failing to take into account delay by the respondent. In my view, the matter mentioned is not significant enough to warrant interference with the decision; even if I had concluded that it was relevant.
  4. [86]
    There may be occasions when the court should consider the general conduct of a defendant in a leave application and it is arguable the issue is relevant to the attitude which the court should adopt generally to a plaintiff’s claim, but in my view the conduct of the respondent in relation to the settlement payment is not relevant to the issue of whether leave should be granted.
  5. [87]
    Other than to the extent already dealt with, this ground of appeal fails.

Conclusion

  1. [88]
    The position overall is that the learned Magistrate’s discretion miscarried by his failing to consider whether the extent of the delay would lead to the inability to ensure a fair trial, and the fact that, if it had been considered, the result would have been in the negative.
  2. [89]
    This is one of the important considerations in deciding whether leave to proceed should be granted, and it was not submitted otherwise. Although there has been delay and the delay has been attributable to the appellant and there is no real explanation for much of it, the proceedings are not that old and if not for some late dilatoriness and the court list, the application may not have been necessary. The claim is for money for services done; albeit that the quality of those services is in issue.
  3. [90]
    A proper exercise of the discretion would have allowed the appellant to take another step in the proceedings.

Costs

  1. [91]
    The usual result of a decision to this effect is that costs should follow the event, which in this case would result in an order that the respondent pay the appellant’s costs of the appeal. Different considerations apply to the costs below. Subject to what the parties have to say, my preliminary view is that the costs order of the Magistrate should not be disturbed.  In the circumstances, I will make provision in the orders for the parties to deliver submissions as to the appropriate costs orders both on appeal and below. The submissions should be no more than four pages in length. I would propose to make my decision as to costs in chambers without any further oral hearing.

Orders

  1. [92]
    For these reasons, I make the following orders:
  1. Appeal allowed.
  2. The decision in the Magistrates Court dated 13 August 2021 be set aside.
  3. The appellant be granted leave under r 389(2) of the Uniform Civil Procedure Rules 1999 (Qld) to take a further step in the proceedings.
  4. The appellant file and serve any submissions as to costs of no more than four pages in length by 23 May 2022.
  5. The respondent file and serve any submissions as to costs of no more than four pages in length by 30 May 2022.

Footnotes

[1][2000] QCA178 [Tyler].

[2][2019] QSC 209 [President’s Club].

[3][2020] QDC 190 [Abalone].

[4]The minor civil dispute limit is $25,000. See Magistrates Court Act 1921 (Qld), s 45(5).

[5]See District Court of Queensland Act 1967 (Qld), s 113; UCPR, r 766, r 785(1).

[6]Allesch v Maunz (2000) 203 CLR 172, [23].

[7]Fox v Percy (2003) 214 CLR 118, [126].

[8]Fox v Percy (2003) 214 CLR 118; Warren v Coombes (1979) 142 CLR 531; Dwyer v Calco Timbers (2008) 234 CLR 124.

[9]District Court Rules 1968 (Qld), r 98(2).

[10]Cf. Order 27 r 2 of the previous Rules of the Supreme Court 1991 (Qld).

[11][2007] QSC 198, [17].

[12][2011] QCA 454, [10]

[13]The President’s Club [2019] QSC 209, [84].

[14]Tyler [2000] QCA 178, [2].

Close

Editorial Notes

  • Published Case Name:

    Lillas & Loel Lawyers v Odlin

  • Shortened Case Name:

    Lillas & Loel Lawyers v Odlin

  • MNC:

    [2022] QDC 107

  • Court:

    QDC

  • Judge(s):

    Sheridan DCJ

  • Date:

    16 May 2022

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Allesch v Maunz (2000) 203 CLR 172
2 citations
Jump To
Cite 1 - (2000) 203 CLR 172
Cite 2 - (2000) 203 CLR 172
Australia Abalone World Pty Ltd v Yin [2020] QDC 190
2 citations
Jump To
Cite 1 - [2020] QDC 190
Cite 2 - [2020] QDC 190
Dwyer v Calco Timbers Pty Ltd (2008) 234 CLR 124
2 citations
Jump To
Cite 1 - (2008) 234 CLR 124
Cite 2 - (2008) 234 CLR 124
Fox v Percy (2003) 214 CLR 118
3 citations
Jump To
Cite 1 - (2003) 214 CLR 118
Cite 2 - (2003) 214 CLR 118
Cite 3 - (2003) 214 CLR 118
Melco Engineering Pty Ltd v Eriez Magnetics Pty Ltd [2007] QSC 198
2 citations
Jump To
Cite 1 - [2007] QSC 198
Cite 2 - [2007] QSC 198
Scrivener v DPP [2001] QCA 454
1 citation
Jump To
Cite 1 - [2001] QCA 454
Scrivener v DPP [2011] QCA 454
1 citation
Jump To
Cite 1 - [2011] QCA 454
The President's Club Ltd v Palmer Coolum Resort Pty Ltd [2019] QSC 209
3 citations
Jump To
Cite 1 - [2019] QSC 209
Cite 2 - [2019] QSC 209
Cite 3 - [2019] QSC 209
Tyler v Custom Credit Corp Ltd [2000] QCA 178
3 citations
Jump To
Cite 1 - [2000] QCA 178
Cite 2 - [2000] QCA 178
Cite 3 - [2000] QCA 178
Warren v Coombes (1979) 142 CLR 531
2 citations
Jump To
Cite 1 - (1979) 142 CLR 531
Cite 2 - (1979) 142 CLR 531

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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