Broadsand Pty Ltd v The Owners - Strata Plan No.51487 [2001] NSWIRComm 332

Industrial Relations Commission of New South Wales in Court Session

CITATION : Broadsand Pty Ltd v The Owners - Strata Plan No.51487 [2001] NSWIRComm 332 APPLICANT Broadsand Pty Ltd PARTIES : RESPONDENT The Owners - Strata Plan No 51487 FILE NUMBER: IRC 5653 of 2001 CORAM: Marks J CATCHWORDS : Expedition of proceedings - Delay in commencing proceedings - Application rejected because no demonstrated factor beyond the control of the applicant LEGISLATION CITED : Industrial Relations Act 1996 s 106 s 109 CASES CITED : The Owners-Strata Plan No.51487 v Broadsand Pty Ltd (2001) NSWSC 813 Ieremia v Skalkos & Anor (1999) NSWSC 76 (revised 31/08/99) HEARING DATES: 12/10/2001 DATE OF JUDGMENT: 12/13/2001

APPLICANT F C Corsaro SC of counsel SOLICITORS Andreones LEGAL REPRESENTATIVES: RESPONDENT M D Young of counsel SOLICITOR David Le Page

JUDGMENT:

INDUSTRIAL RELATIONS OF NEW SOUTH WALES IN COURT SESSION CORAM: MARKS J Thursday 13 December 2001 Matter No IRC 5653 of 2001 BROADSAND PTY LTD v THE OWNERS - STRATA PLAN No 51487 Application under s106 of the Industrial Relations Act 1996 JUDGMENT ON APPLICATION FOR EXPEDITION 1 In these proceedings the applicant Broadsand Pty Ltd seeks relief under s 106 of the Industrial Relations Act 1996 ("the Act") against the respondent the Owners - Strata Plan No. 51487. The proceedings revolve around and are directed to a document called a Management and Letting Sales Agreement made between the respondent and another company which was ultimately assigned to the applicant by which the applicant was entitled to provide certain services and facilities in connection with premises known as Victoria Tower 197-199 Castlereagh Street Sydney. The proceedings brought under s 106 seek to declare that agreement and the deed of assignment of that agreement unfair and seek that they be varied.

2 The applicant became the assignee of the Management and Letting Sales Agreement on 13 May 1998. The relationship between the applicant and the respondent deteriorated. By letter dated 31 January 2000 solicitors acting for the respondent wrote to the applicant asserting that the agreement was void because it breached certain provisions of the Property, Stock and Agents Act 1941 in that the respondent was required to hold by that Act and did not hold a Strata Managing Agents Licence.

3 By summons filed in the Equity Division of the Supreme Court of New South Wales on 14 August 2000 the respondent as plaintiff sought a declaration against the applicant as defendant that the Management and Letting Services Agreement was void or alternatively unenforceable. The Supreme Court proceedings were the subject of a number of interlocutory steps, to which I shall later refer. By summons filed on 23 August 2001 the applicant commenced these proceedings. On the following day the applicant sought an order from the Supreme Court that the proceedings before that Court be stayed pending the determination of the proceedings under s 106 of the Act instituted in this Court. The stay application was heard by Bryson J who delivered judgment on 17 September 2001. His Honour declined to stay the proceedings in the Supreme Court.

4 In para 6 of his Honour's judgment Bryson J made some comment about the interlocutory processes and the participation of the applicant in those processes. His Honour said: "Broadsand and the solicitors who at first acted for it did not act in an effective or efficient way in preparing the Supreme Court litigation for hearing. Time was wasted by filing obviously defective documents which purported to be Notices of Appearance, and a regular Appearance was entered on 26 September 2000. Broadsand did not file affidavits in accordance with Practice Note 63; on several occasions the Registrar directed that Broadsand's affidavits be filed within stated times, but they were not. There was correspondence in the nature of a request for particulars and reply on 28 February and 1 March 2001. There was a change of representation and Broadsand's present solicitors filed Notice of Change on 17 May 2001. In June a further order was obtained limiting time for affidavits to 3 July. Broadsand filed two affidavits dealing with the merits on 26 June and 3 July 2001. On 20 July the Registrar gave leave to file a cross-claim against the Owners Corporation and refused leave to file another cross-claim against Broadsand's former solicitors and among other directions, listed the proceedings for Call-over on 12 September for allocation of a hearing date. The Owners Corporation has filed its defence to Cross-claim and some affidavits in reply."

5 In concluding that the applicant's stay application should be rejected Bryson J said in part (par 15): "The plaintiff brought forward its position by a carefully considered letter in January 2000 and commenced the litigation in August 2000; the plaintiff has followed a regular procedural course which led to the matter being listed before the Registrar on 12 September to appoint a hearing date after going through a course of preparation in which Broadsand's participation was not prompt or timely. Broadsand adverted to the possibility of bringing its proceedings only about June 2001 after a change in representation by solicitors and consultation of fresh counsel. Even then Broadsand did not bring its proceedings promptly and commenced them less than three weeks before the existing appointment to fix a date for hearing. In the ordinary course, which is often departed from, the hearing the Supreme Court may well take place in the early months of the year 2002, whereas the hearing in the Commission in the ordinary course will probably take place late in that year. However there are many vicissitudes in listing and it is open to the Commission to regulate its own proceedings and to expedite matters as it thinks right. Broadsand has proffered an undertaking to conduct the litigation in the Commission expeditiously and to apply for expedition. The compulsory conciliation procedures of the Commission represent a considerable procedural advantage and offer prospects of relatively early resolution if successful. A decision by the Court that the Agreement is void would not, it seems to me, put an end to prospects of obtaining a favourable exercise of power under s.106, which extends to arrangements other than enforceable agreement. I do not accept Senior Counsel's contention that Broadsand's claim would be precluded from consideration by the Declaratory Order which the Owner's Corporation seeks . Whichever decision is given first may well limit the issues available for contest in the other, depending on what issues the judge of trial finds it necessary to dispose of: this consequence, and any inconveniences which may be perceived to follow, cannot be averted, either way. The Owners Corporations is paying fees mouth by mouth under an agreement which it contends is void: it has got its case ready to fix a hearing date a year after its Summons was issued, and Broadsand's litigation has only just been started. These matters outweigh the claims of convenience brought forward by Broadsand, by a considerable preponderance.

6 The proceedings have been set down for hearing in the Supreme Court on 21 and 22 February.

7 In this court the respondent has foreshadowed the bringing of a cross-claim asserting that if it is unsuccessful in obtaining a declaration in the Supreme Court that the Management and Letting Services Agreement is void then it will seek relief in the nature of a finding that the agreement and the assignment of it was unfair and that it be avoided. In addition to relying upon the grounds of illegality previously referred to the respondent asserts unfairness in the terms and conditions of the agreement and the way in which it has been administered by the applicant.

8 The notice of motion for expedition in this Court was filed by the applicant on 2 October 2001. Without determining the matter I conducted a Conciliation, which is a mandatory procedure under s 109 of the Act on 11 October 2001. The proceedings were not concluded that day and the parties agreed to continue to discuss and endeavour to negotiate a settlement. The conciliation was ultimately unsuccessful. The hearing of the notice of motion for expedition was stood over until 10 December 2001, on which date the matter was fully argued.

9 The applicant's submissions in favour of expedition centred around the need to have the proceedings in this Court dealt with prior to the dates set down for the hearing of the proceedings in the Supreme Court, namely 21 and 22 February next. In essence that would have required the hearing of these proceedings to be expedited in such a way that they could dealt with during the forthcoming summer vacation. The applicants submitted that the jurisdiction of this Court was much broader than that of the Supreme Court. The jurisdiction of the Supreme Court as agitated in the summons was confined to two points of law namely the legality of the agreement and whether an option to extend the term of the agreement had been properly exercised. This was contrasted with the jurisdiction of this Court which has power in appropriate circumstances to vary the terms and conditions of the agreement.

10 It was submitted on behalf of the respondent that it would be unjust to force it to prepare for an expedited hearing over a short period of time particularly with the intervening Christmas and New Year holiday period. Because the basis and nature of the proceedings in each of the Courts are different it would not be possible merely to rely upon the evidence given in the Equity proceedings, as had been asserted by the applicant. The respondent said it would require discovery of the applicant's documents with respect to the circumstances in which it entered into the agreement and the circumstances of the assignment and that it would need to explore through the discovery and inspection process the cost to the applicant of the supply of the services which it provided to the respondent. The respondent complained not only about the cost of those services but also the manner in which they were carried out. The respondent anticipated that it would need to obtain lay evidence about the services which were provided and expert evidence concerning the rates of remuneration payable under the agreement including a built-in escalation of fees to cover inflation. Furthermore, the respondent and its legal advisors would need to spend some time in the preparation of the Supreme Court proceedings.

11 In these circumstances, it was submitted that it would be unjust to impose the burden associated with the expedition of these proceedings. Furthermore there was no necessity for the proceedings to be expedited particularly as they had not been commenced until about 12 months after the Supreme Court proceedings had been instituted.

12 The respondent also based its argument upon questions of logic as to which of the proceedings in each of the Courts ought to be determined first. It is not necessary that I traverse these arguments.

13 In one sense each Court endeavours to determine all of its proceedings expeditiously. In order to justify expedition of the proceedings so that a litigant "jumps the queue" and displaced an otherwise orderly approach to the listing of matters, it is necessary to demonstrate some particular urgency with respect to the proceedings that justifies such an order being made, and that the urgency has arisen as a result of some factor over which the party has no control.

14 Applications for expedition are normally encountered where circumstances arise which are beyond the control of a litigant and which dictate that the matter must be dealt with to finality expeditiously. In Ieremia v Skalkos & Anor (1999) NSWSC 76 Levine J in the Supreme Court of New South Wales, when referring to personal injury claims said :"Expedition is usually sought when, to put it starkly, the life of a party is in peril of ending before the case is heard. It might be the case that ill health or a sudden deterioration in the psychological condition of a party intervenes. That which is in common is said to be the intervention of a factor over which the litigant has no control." (at par 36). However, the intervening factor over which the litigant has no control must be one which is of itself likely to frustrate the litigation if the hearing is not expedited. For example, in Ieremia Levine J declined to grant expedition in the case of a plaintiff who was to be posted abroad. This was characterised by Levine J as being a matter of "convenience". In addition, his Honour noted that a court would be less likely to grant expedition where a party had not pursued a case "with vigour" or where the proceedings were not "initiated with promptitude".

15 In these proceedings, the factor which has motivated the applicant to initiate this application for expedition is the spectre of the Supreme Court proceedings set down for hearing next February which arguably may impact upon its ability to litigate its case fully in its present form in this Court. Whilst there may be some sympathy for the applicant's position in terms of a potential vulnerability by reason of the existence of the Supreme Court proceedings, the fact remains that the proceedings in this Court were not commenced, as I have said, until about 12 months after the proceedings were commenced by the respondent as plaintiff in the Supreme Court. Mr Corsaro SC who appeared for the applicant conceded that the delay was occasioned by the fact that the applicant's previous legal advisors had not appreciated the potential availability of the jurisdiction of this Court. This may or may not give rise to rights in the applicant as against other persons, but in the totality of the circumstances of these proceedings it is only one factor to be taken into account amongst several others. This factor is not one over which the applicant had no control.

16 In my opinion the expedition of these proceedings to enable them to be heard to finality before the 21 and 22 February, allowing for the forthcoming summer vacation would impose an undue and unreasonable burden on the respondent and the respondent's legal advisors. Given the commitments of the judges of this Court I doubt whether a judge would have time to deal with the matter other than as an urgent matter before a vacation judge. I accept the submissions of the respondent that there are a number of factual and legal matters which arise under these proceedings which in all probability will not arise in the proceedings in the Supreme Court, those proceedings being predominantly confined to questions of law.

17 I conclude that the applicant has not demonstrated the existence of factors which would compel the acceleration of the litigation process and the displacement of other litigation which would occur if these proceedings were expedited. Indeed, the applicant has not demonstrated in my opinion that any intervening factor has arisen which would justify expedition, particularly having regard to the delay in the commencement of the proceedings in this Court.

18 In addition, any finding of law and any resultant agreement would not necessarily preclude the applicant from reframing its case, as one based on an arrangement between the parties, as foreshadowed by its counsel.

19 For these reasons the notice of motion filed by the applicant is dismissed. The applicant is to pay the respondent's costs of the notice of motion as assessed in default of agreement. ____________________________________

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