Makucha v Brian Tucker & Associates Pty Ltd [2003] FCA 1089 (22 September 2003)

Last Updated: 4 December 2003

FEDERAL COURT OF AUSTRALIA

Makucha v Brian Tucker & Associates Pty Ltd [2003] FCA 1089

PRACTICE & PROCEDURE - application for summary dismissal - where failure by applicants to comply with orders of the Court - where failure by applicants to put on evidence - where failure causes respondents' prejudice

PAUL MAKUCHA & NOTHINTOOHARD PTY LIMITED v BRIAN TUCKER & ASSOCIATES PTY LIMITED, BRIAN TUCKER, NEPEAN ENGINEERING PTY LIMITED, LEAN & HAYWARD PTY LIMITED & PHILIP HAYWARD

N 869 OF 2002

BENNETT J

22 SEPTEMBER 2003

SYDNE

YIN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N869 OF 2002

BETWEEN:	PAUL MAKUCHA FIRST APPLICANT NOTHINTOOHARD PTY LIMITED (ACN 080 711 897) SECOND APPLICANT
AND:	BRIAN TUCKER & ASSOCIATES PTY LIMITED FIRST RESPONDENT BRIAN TUCKER SECOND RESPONDENT NEPEAN ENGINEERING PTY LIMITED (ACN 001 375 239) THIRD RESPONDENT LEAN & HAYWARD PTY LIMITED (ACN 067 492 755) FOURTH RESPONDENT PHILIP HAYWARD FIFTH RESPONDENT
JUDGE:	BENNETT J
DATE OF ORDER:	22 SEPTEMBER 2003
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. Pursuant to Order 10 rule 7 the proceedings be dismissed against all respondents.

2. Applicants to pay the respondents' costs.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N869 OF 2002

BETWEEN:	PAUL MAKUCHA FIRST APPLICANT NOTHINTOOHARD PTY LIMITED (ACN 080 711 897) SECOND APPLICANT
AND:	BRIAN TUCKER & ASSOCIATES PTY LIMITED FIRST RESPONDENT BRIAN TUCKER SECOND RESPONDENT NEPEAN ENGINEERING PTY LIMITED (ACN 001 375 239) THIRD RESPONDENT LEAN & HAYWARD PTY LIMITED (ACN 067 492 755) FOURTH RESPONDENT PHILIP HAYWARD FIFTH RESPONDENT

JUDGE:	BENNETT J
DATE:	22 SEPTEMBER 2003
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1 Before the Court today are three notices of motion filed respectively by the first and second respondents, the third respondent and the fourth and fifth respondents, seeking orders pursuant to Order 30 rule 5, or alternatively Order 10 rule 7, that these proceedings be dismissed. The respective notices of motion were filed by the first and second respondents on 19 March 2003, the fourth and fifth respondents on 25 February 2003 and as the third respondent today, 22 September 2003. The notice of motion filed by the third respondent I made returnable instanter, in the circumstances.

2 The basis of the statement of claim seems to be, broadly, that the applicants contracted with the first and second respondents to conduct various surveying tasks in preparation for the construction of a commercial property in Mascot, New South Wales. The applicants allege that the first and second respondents made certain representations with respect to their experience and expertise.

3 The applicants claim that the first and second respondents were negligent in the performance of the services and that they breached the terms of their engagement. Further and in the alternative there are claims under s 52 of the Trade Practices Act 1974 (Cth) (`Trade Practices Act').

4 Upon the termination by the applicants of the services of the first and second respondents, the applicants engaged the third respondent to conduct certain construction design activities. On the recommendation of the third respondents, the applicants engaged the fourth and fifth respondents to conduct further surveying tasks. The applicants claim that the third, fourth and fifth respondents were negligent in the performance of the services and breached the terms of their engagement. There are also claims as against the third, fourth and fifth respondent with respect to the Trade Practices Act.

5 I note that the second applicant is a company of which the first applicant is apparently a director. From the evidence before me the following chronology emerges. The professional services that are complained of in the statement of claim were provided between February 2001 and April 2002 and the statement of claim was filed in August 2002. The claim is for damages of $5,000,000 plus exemplary and aggravated damages.

6 When the matter first came before the Court on 4 September 2002 there was no appearance for the applicants and the proceedings were stood over. At the next directions hearing on 11 September 2002 there were orders made by consent providing a timetable for the provision of requests for particulars and answers and then, following that, further orders with respect to the filing of defences and discovery. On 13 September 2002 a request for particulars was made by the solicitors for the fourth and fifth respondents.

7 On 11 December 2002, the matter came back before the Court. The Court was informed that the applicants had failed to provide particulars in accordance with the orders of 11 September 2002, the matter was adjourned to allow the applicants to prepare the case further and orders were made requiring the applicants to meet the costs of the third, fourth and fifth respondents that had been incurred at previous directions hearings.

8 The matter next came before the Court on 29 January 2003 and the applicants sought a further two weeks to obtain a surveyor's report. By consent the applicants were granted two further weeks to put on affidavit evidence.

9 At the next directions hearing on the 12 February 2003, the applicants sought a six week adjournment and extension to the orders requiring them to file affidavit evidence. That adjournment and extension were opposed by the respondents but an order was made by the Court that the applicants file affidavits by 11 March 2003. It was also discussed that the respondents might file and serve an application for summary dismissal, and the fourth and fifth respondents were directed to file and serve any such motion by 25 February 2003. A return date of 19 March 2003 was set for the hearing of that motion.

10 On 25 February 2003 the fourth and fifth respondents filed and served a notice of motion, together with the supporting affidavit of Beverly Brown, seeking dismissal of the application or a permanent stay and orders for costs. On 19 March 2003 the matter came before Beaumont J for hearing of the motion. On that occasion the first applicant appeared in person and informed the Court that his solicitors had withdrawn from the proceedings and that he was seeking advice from Senior Counsel.

11 His Honour noted a concern at the lack of progress in the proceedings on the part of the applicants and, in the circumstances, made an interlocutory order staying the proceedings until further order, reserving liberty to apply to vary or discharge that stay upon seven days notice. However, his Honour said:

`... my present view is that I would only lift the stay in the event that I were to be persuaded, on evidence, that the applicants have a reasonably arguable case ...'

His Honour ordered the applicants to pay the costs of the respondents in the proceedings to date (Makucha v Brian Tucker & Associates Pty Ltd ([2003] FCA 250).

12 It is clear from the affidavit evidence that there has been numerous correspondence from the solicitors for the various respondents and both the solicitor for the applicants and later the first applicant himself. Suffice to say that the response to that correspondence has either been non existent or has simply been in relation to adjournment applications. There was no response to the request for particulars and there have clearly been no affidavits filed by the applicants as directed by the Court. The first applicant was informed of today's proceedings, and at least as far as the correspondence from the fourth and fifth respondents are concerned, letters were sent by registered post informing the first applicant of the hearing today. The matter was called outside the Court and there was no appearance by the applicants.

13 While the respondents rely both on Order 30 rule 5 and Order 10 rule 7, I note that, in Lenijamar Pty Ltd and AGC (Advances) Limited (1990) 27 FCR 388 (`Lenijamar'), Wilcox and Gummow JJ (at 396) pointed out that Order 30 rule 5, which authorises the dismissal for want of prosecution of a proceeding, is only relevant in circumstances where those proceedings have been formally set down for trial by the filing of a notice of trial. No notice of trial has been filed in the present case and no notice of trial had been filed in Lenijamar. Accordingly, as their Honours noted, Order 30 rule 5 is not applicable.

14 The respondents, however, also seek an alternative order under Order 10 rule 7. In Lenijamar their Honours noted (at 395-396):

`It is to be noted that the power given by this rule [Order 10 rule 7] is conditioned on one circumstance only: the failure of a party to comply with an order of the Court directing that party to take a step in the proceeding. There is no requirement of intentional default or contumelious conduct, although the attitude of the applicant to default and the court's judgment as to whether or not the applicant genuinely wishes the matter to go to trial within a reasonable period will usually be important factors in weighing the proper exercise of the discretion conferred by the rule.

... The discretion conferred by O 10 r 7 is unconfined, except for the condition of non-compliance with a direction. As it is impossible to foresee all the circumstances under which the rule might be sought to be used, it is undesirable to make any exhaustive statement of the circumstances under which the power granted by the rule will appropriately be exercised. We will not attempt to do so. But two situations are obvious candidates for the exercise of the power: cases in which the history of non-compliance by an applicant is such as to indicate an inability or unwillingness to co-operate with the Court and the other party or parties in having the matter ready for trial within an acceptable period and cases - whatever the applicant's state of mind or resources - in which the non-compliance is continuing and occasioning unnecessary delay, expense or other prejudice to the respondent.'

15 Their Honours further noted that the cumulative effect of an applicant's defaults may be such as to satisfy the Judge that the applicant is either subjectively unwilling to co-operate or, for some reason, is unable to do so. In those circumstances fairness to the respondents would normally require the summary dismissal of the proceeding.

16 The position as set out by their Honours in Lenijamar was accepted by the Full Court in Fisher v Rural Adjustment & Finance Corporation of Western Australia (1995), 57 FCR 1 and has been adopted in other cases. I note that, in the present case, it is apparent that there has been little if any effort made by the applicants to address or comply with the Court's orders, even at these early stages of preparation for hearing. No expert evidence has been filed or served and the request for particulars, which does not on its face appear to require advice from an expert, has not been answered.

17 The applicants have been given a degree of latitude in the preparation for hearing and on numerous occasions have been given notice that the matter would be before the Court and that the respondents were seeking summary dismissal. I also note, that despite the order having been made for costs and the applicants having been informed by the respondents of the amount of costs that are being sought and requests made to the applicants that they pay costs, there has been no reply to that correspondence, nor has there been any payment of the amount requested.

18 The amount of costs already incurred by the respondents are significant. The prejudice to the respondents if this case were to continue further, in circumstances where they are continually coming back to the Court for orders as against the applicants, which orders are not complied with, together with the other matters to which I have referred to make it clear to me that I should exercise my discretion under Order 10 rule 7 and make the orders sought.

19 Accordingly, I order that, pursuant to Order 10 rule 7, the proceedings be dismissed as against each of the respondents and I order the applicants to pay the respondents costs.

I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bennett.

Associate:

Dated: 26 November 2003

No appearance by the Applicant
Solicitor for the First Respondents:	Phillips Fox
Solicitor for the Second Respondents:	Phillips Fox
Solicitor for the Third Respondents:	Marsdens Law Group
Solicitor for the Fourth Respondents:	Colin Biggers & Paisley
Solicitor for the Fifth Respondents:	Colin Biggers & Paisley
Date of Hearing:	22 September 2003
Date of Judgment:	22 September 2003