Hay v Belconnen Magpies Sports Club and WS Gregory & Associates Pty Limited [2010] ACTSC 1 (29 January 2010)

Last Updated: 3 February 2010

WARWICK PETER HAY v BELCONNEN MAGPIES SPORTS CLUB LIMITED & ANOR

[2010] ACTSC 1 (29 January 2010)

PRACTICE AND PROCEDURE – proceedings struck out by operation of Court Rules – application to reinstate proceedings – application rendered nugatory by amendment to Rules – application stood over generally – plaintiff ordered to pay costs to date

Court Procedures Rules 2006 rr 75, 76

Court Procedures Amendment Rules 2009 (No 3)

Limitation Act 1985

No. SC 474 of 2004

Judge: Master Harper

Supreme Court of the ACT

Date: 29 January 2010

IN THE SUPREME COURT OF THE )

) No. SC 474 of 2004

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: WARWICK PETER HAY

Plaintiff

AND: BELCONNEN MAGPIES SPORTS CLUB LIMITED

First Defendant

W S GREGORY & ASSOCIATES PTY LIMITED T/AS STS SECURITY

Second Defendant

ORDER

Judge: Master Harper

Date: 29 January 2010

Place: Canberra

THE COURT ORDERS THAT:

1. The plaintiff’s application in proceeding dated 26 June 2009 be stood over generally with liberty to any party to restore it to the list on seven days notice.

2. The defendants’ costs of the application to date be paid by the plaintiff.

1. This is an application to reinstate a proceeding which is taken to have been struck out by the operation of r 75(2) of the Court Procedures Rules 2006. When the application was filed, r 75 was in the following terms:
   75. When proceeding struck out

(1) A proceeding is taken to be struck out in relation to a defendant if—

(a) at the end of 1 year after the day the originating process is

issued, an affidavit of service of the process on the defendant

has not been filed in the court; or

(b) at the end of 1 year after the day the originating process is

served on the defendant—

(i) a notice of intention to respond or defence has not been

filed in the court by the defendant; and

(ii) judgment has not been entered in relation to the

defendant; and

(iii) the proceeding has not otherwise been disposed of in

relation to the defendant.

(2) Also, a proceeding is taken to be struck out in relation to a party if

the party does not take a step in the proceeding before the end of

1 year after the day the last step was taken in the proceeding.

(3) For subrule (2), the filing in the court of a notice of intention to

proceed in relation to a proceeding is taken to be a step in the

proceeding.

(4) A proceeding is taken to be struck out under subrule (1) or (2) on

the day after the day the relevant 1-year period mentioned in the

subrule ends.

2. The present action was commenced on 12 July 2004 against the first defendant. The plaintiff claimed damages in negligence for personal injury, principally fractures to the left forearm. The plaintiff asserts in the statement of claim that on 25 April 2003 he was at the first defendant’s club with friends. Earlier in the evening he and his friends were approached by a group of aggressive men. At about 9.00 pm, club security staff directed the group of men to leave the premises. About half an hour later the plaintiff and his companions left the club. They saw the other group outside. Fearing attack, they tried to get back into the club but were refused entry by bouncers at the door. They were then attacked by the other group and the plaintiff was injured. The plaintiff claims that his injuries were caused as a result of a breach of a duty of care owed to him by the club.
3. The limitation period applicable to the action brought by the plaintiff under the Limitation Act 1985 was three years. The action was commenced well within that period.
4. In a defence filed in September 2004, the first defendant said that the security staff working at the club at the time were employees of another company, now the second defendant, and were not servants or agents of the first defendant. In the circumstances the first defendant denied that it was vicariously liable for the acts or omissions of the security staff.
5. The plaintiff sought and was granted leave to join the second defendant. An amended originating application and statement of claim was filed in November 2005. In January 2006 an appearance was entered on behalf of the second defendant, followed by a defence in May 2006. The second defendant admitted in the defence that it was engaged by the first defendant to provide personnel to undertake certain duties but generally denied everything else. At the same time, the second defendant filed a notice claiming indemnity or contribution from the first defendant.
6. On 1 July 2006 the Court Procedures Rules came into effect, including r 75.
7. In April 2007 the first defendant filed a notice claiming contribution or indemnity from the second defendant. The latter filed a defence to that claim the following month.
8. No further documents were filed by any of the parties until, on 6 May 2008, the Registrar sent a notice to each of them. The notice stated that pursuant to r 75(2), the proceeding was taken to have been struck out on 3 May 2008. At that time, the last document filed on behalf of the plaintiff remained the amended originating application and statement of claim, filed on 22 November 2005. Steps had been taken by other parties at intervals since then. It appears to me that the Registrar interpreted the subrule correctly and that the action was indeed taken to have been struck out in relation to each of the parties on 3 May 2008. It is clear that if a notice of intention to proceed had been filed by any party on or before 2 May 2008, the action would not have been taken to be struck out under the rule. Time would have started to run again from the date of the filing of such a notice.
9. It should be noted that there is no requirement for the Registrar to notify the parties that an action is taken to have been struck out. The practice adopted by the Registrar in doing so is a helpful one, but the giving of notice is strictly unnecessary.
10. On 13 May 2008 the plaintiff’s solicitors made an application under r 76 for an order that the proceeding be reinstated. The application was supported by an affidavit by Mr Gabbedy, the solicitor having the conduct of the matter. The affidavit was very brief and would not have been adequate, in my view, as an explanation for the delay in prosecuting the action if the application had fallen for determination on its merits.
11. At the time r 76 provided as follows:
    76. Reinstating struck out proceeding

(1) A person whose proceeding has been struck out under rule 75 may

apply to the court to reinstate the proceeding.

(2) The court may reinstate the proceeding if it is in the interests of

justice to reinstate the proceeding.

(3) For any time limit (including a limitation period), a proceeding that

is reinstated is taken to have started on the day the originating

process for the proceeding was filed in the court and is taken never

to have been struck out.

12. The application came before the Registrar on 26 May 2008. A solicitor appeared for the plaintiff and, I assume, mentioned the matter for the other parties. The Registrar made the order by consent.
13. In making such an order, the Court must be satisfied that it is in the interests of justice to reinstate the proceeding. It should not be assumed that the Court will necessarily exercise its discretion to do so simply because all parties consent to it.
14. Somewhat extraordinarily, no step was taken by any party during the next twelve months. On 27 May 2009, the proceeding was taken to have been struck out again. On 2 June 2009, the Registrar sent a further notice to that effect to each of the parties.
15. On 26 June 2009, the plaintiff’s solicitors filed a further application for reinstatement, supported by an affidavit by Mr Gabbedy. He deposed that there had been activity in the matter between the solicitors. A settlement conference had been arranged, initially for 20 April and subsequently for 4 May 2009, but for various reasons the conference had not taken place. Mr Gabbedy further deposed as follows:

One of the difficulties experienced in progressing this matter has been quantification of the plaintiff’s economic loss. The plaintiff is self-employed and has been involved in several partnerships. Full details and tax returns have been sought but not all have been provided to date.

16. Mr Gabbedy annexed to his affidavit a letter from the then solicitors for the second defendant dated 22 May 2009. The solicitors informed Mr Gabbedy that they had been acting for the second defendant on instructions from an insurance company, Trans Pacific Insurance Corporation. On 23 April 2009, the insurance company had been placed in provisional liquidation by Barrett J in the Supreme Court of New South Wales. The provisional liquidator had formed the view that the insurance company was insolvent and that its liabilities exceeded its assets. In the circumstances the second defendant was not in a position to participate in a settlement conference. The solicitors said that it was unclear whether they would continue to act for the second defendant.
17. On 27 July, a notice of change of solicitor was filed on behalf of the second defendant. The solicitor with the conduct of the matter at that firm swore an affidavit on 22 September saying that the firm had been instructed by a director of the second defendant, which was now without insurance. He deposed that the insurer, now in provisional liquidation, had until then dealt with the claim on behalf of the second defendant itself, and that the latter had had no direct involvement.
18. An affidavit was affirmed on the same date by the general manager of the first defendant, Mr Burrows. He had been general manager of the club since 1998. He had not been at the club at the time of the incident and thought he had probably heard about it three days after the event. He annexed to his affidavit an incident report form on the second defendant’s stationery, completed by one Mick Walsh and naming Colin Mead as a witness. The incident had occurred at 9.30 pm on 25 April 2003 outside the club. Mr Walsh’s handwritten report was as follows:

I asked some guys to leave the club because they were intoxicated. There was two groups. I said to one group you leave now. They said no, not until they leave so I said okay, you both can go now. They went outside and one guy pushed another. He fell. Then the guy went over and stomped on his head. He was unconscious. There was about ten guys onto three. I said to Colin come and help me. He just ignored me, stood inside, so I tried to stop the fight because it was all-in brawl. We called ambulance. The guy came around after a while. Ambulance took him away. Another guy got a broken arm. The police came and they said is everything okay? I said not really. I said I think we should close. Police said it’s your call. I said it’s all for the best so they spoke to DM and they decided to close for the best. I spoke to Ricky Dolliver. He said Mick it’s ashamed we only had one guard tonight.

19. Mr Burrows deposes that Mr Walsh was an employee of the second defendant. Mr Dolliver was a senior duty manager employed by the club at the time. He worked for the first defendant from 2001 to 2005. He was not rostered on duty at the time of the incident, the duty manager on the night being one Tony Collins. Mr Collins had worked for the club for about six months during 2003. Mr Burrows has not seen him since then and had no contact details for him. He has no independent recollection of whether he ever discussed the incident with Mr Collins or Mr Dolliver although he thinks that he probably would have done so. He has no recollection of seeing any other incident report, or speaking to police about the incident.
20. He says that the club kept incident reports, completed by the duty manager. He cannot recall having seen such a report about the incident in question, and says that any such report would have been destroyed after five years.
21. He says that there were eight employees on duty at the club on the night of the incident. None are still employed by the club, six of the eight having left the club’s employment by August 2004 (when the club was served with the originating process). The other two employees had left in 2006 or 2007.
22. The solicitor for the second defendant in his affidavit says that Mr Walsh left the second defendant’s employment in about 2005 and that the second defendant has no information about his present whereabouts or contact details.
23. Mr Gabbedy put on a further affidavit on 19 October, annexing a letter his firm had written to the first defendant on 5 February 2004, giving notice of intention to make a claim for damages on behalf of the plaintiff. The letter gave a brief description of the incident and mentioned that the firm was instructed that it had been the third incident on the same day at the club requiring police attendance and that, following the incident, the club had been closed by an attending sergeant. Mr Gabbedy also summarised in the affidavit information about the plaintiff’s present condition, given to him by the plaintiff’s wife.
24. On 15 October 2009, the liquidator of Trans Pacific Insurance Corporation reported at length to the creditors of the company. He expressed the preliminary view, which he described as speculative, that creditors could expect an eventual dividend within a range of 19 to 33 cents in the dollar. I infer that the liquidator will not be playing a part in the litigation, or making any contribution from funds available to him towards the second defendant’s costs.
25. After directions in relation to the filing of affidavits, the application came before me for hearing on 23 October. Counsel for the plaintiff submitted that the interests of justice favoured the reinstatement of the action. Counsel for each of the defendants submitted that there was evidence of actual prejudice to their clients if the action was permitted to proceed.
26. The principles applicable to an application for reinstatement under r 76, as it then stood, were expounded by Buchanan J in Equuscorp Pty Ltd v Lah [2009] ACTSC 113 (7 September 2009, unreported). Buchanan J, on the facts of that matter, ordered, subject to undertakings given by the plaintiff, that the action be reinstated. Without going into the issues in detail, it seems to me that the application of the principles, as they emerge from his Honour’s reasons, would almost certainly have obliged me to refuse the plaintiff’s application for reinstatement in the present case.
27. However, after the conclusion of the hearing of the application but before I arrived at a decision, the Court Procedures Rules were amended: Court Procedures Amendment Rules 2009 (No 3). Rr 75 and 76 were amended by substituting the word “dismissed” for the words “struck out” wherever appearing, and by adding two subrules to r 76. The amendments came into operation on 1 January 2010. The subrules provide:

(2A) A proceeding that has been dismissed under r 75(2) is reinstated if, before the end of 1 year after the day the proceeding is dismissed, a party to the proceeding files a document in the proceeding.

(2B) The party filing the document must serve a copy of the document on each other active party to the proceeding not later than 3 days after the day the document is filed.

28. For the purpose of r 76, the date of dismissal of the present action is 27 May 2009. If the plaintiff had done nothing since that date, it would remain open to the plaintiff to reinstate the action by filing a document before 27 May 2010. This application would have become unnecessary.
29. There is an issue as to whether the amendments to r 76 operate retrospectively. If they do, then it follows that the application was reinstated when the plaintiff’s solicitors filed their application on 26 June 2009. If not, it is necessary for the solicitors for the plaintiff to file another document after 1 January 2010 to achieve reinstatement. A notice of intention to proceed would be enough to achieve this outcome – see r 75(3). It seems to me in practical terms unnecessary to make a decision about the issue of retrospective operation of the amendments. Whilst such a decision is strictly necessary to determine the present application on the material and the submissions before me, it is in practical terms unnecessary because the plaintiff can and presumably will file a notice of intention to proceed or some other document well before 27 May 2010, with the effect of reinstating the action regardless of my decision.
30. In the unlikely event that the plaintiff takes no further steps prior to 27 May 2010, but subsequently instructs his solicitors to seek reinstatement, it should remain open to the plaintiff to pursue this application and for that purpose I propose to stand it over generally with liberty to restore. It need scarcely be said that by then the plaintiff’s task will have become an extremely difficult one.
31. The plaintiff approached the Court seeking an indulgence, by a path which was required as the rules then stood. His prospects of success could not have been described as strong. The defendants were clearly entitled to oppose the application as vigorously as they did. The plaintiff should pay the costs of both defendants of the application to date.

I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Master.

Associate:

Date: 29 January 2010

Counsel for the plaintiff: Mr NJ Gabbedy

Solicitors for the plaintiff: Pappas J Attorney

Counsel for the first defendant: Mr DD Rutherford

Solicitors for the first defendant: Meyer Vandenberg

Counsel for the second defendant: Mr FMG Parker

Solicitors for the second defendant: Slater & Gordon

Date of hearing: 23 October 2009

Date of decision: 29 January 2010