MAQBOOL T/A MAX & CO V SUNDER HC AK CIV-2009-404-004040 [2009] NZHC 1285 (18 September 2009)

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
                                                              CIV-2009-404-004040



              BETWEEN                    KHAN MAQBOOL T/A MAX & CO
                                         Appellant

      
       AND                        NITYA NAND SUNDER
                                         Respondent


Hearing:      18 September
2009

Appearances: Appellant in Person
             S Singh for Respondent

Judgment:     18 September 2009


                  
   ORAL JUDGMENT OF VENNING J




Solicitors:    Singhs, Auckland
Copy to:       K Maqbool, Auckland




MAQBOOL T/A MAX & CO V SUNDER
HC AK CIV-2009-404-004040 18 September 2009

[1]    This is an appeal from a decision of Judge Wade in the District Court at
Manukau
refusing to set aside an earlier decision of the District Court pursuant to
which the appellant's summary judgment and substantive
proceedings against the
respondent was struck out for want of prosecution.


[2]    The appellant is a qualified solicitor. He also
holds an engineering degree.
He and the respondent entered a building contract pursuant to which the appellant
was to carry out building
work for the respondent. The appellant carried out certain
of the building work. A dispute arose between the parties as to its quality.
The
appellant then took proceedings against the respondent. On 10 November 2006 he
filed an application for summary judgment in the
District Court at Manukau against
the respondent. On 11 December 2006 the respondent filed a notice of opposition
together with a
statement of defence and counterclaim.


[3]    The matter then came before the District Court on a number of occasions for
mention.
The District Court record discloses review of the file on no less than six
occasions before the file was before the Court on 27 July
2007. On 27 July 2007
there was no appearance of or on behalf of the appellant. The Judge struck the
summary judgment application
and the substantive proceeding out for want of
prosecution.


[4]    On 30 September 2008 the appellant filed an application to set
aside the
orders made on 27 July. That application was adjourned from time to time and
eventually was heard by Judge Wade on 6 May.


[5]    In declining to set aside the earlier decision striking out the appellant's
proceedings the Judge identified the relevant
rule as r 473 of the District Court Rules
1992. He then noted that the application was made almost 13 months after the
matter was
struck out and that the appellant as a solicitor did not receive notice of the
hearing because he had shifted address and failed
to file a change of address for
service with the Court. The Judge noted that the respondent had had to obtain the
services of another
builder to complete the work, recorded his concern at the delay
between the action being struck out and the application to set aside
that decision and
concluded that:

          [12]     Although a Court must not fall into the temptation of adjudicating
      
   prematurely on an action without giving an opportunity to both sides,
          nevertheless it is incumbent upon the plaintiff,
in accordance with the Rules,
          to satisfy the Court that there has been or may have been a miscarriage of
          justice.

          [13]    I have to conclude that the plaintiff has totally failed in that respect
          and, therefore, the application
to set aside is dismissed, with costs.

[6]       The inference to be taken from the Judge's reasoning is that he was
(properly)
concerned at the lengthy delay in applying to set aside and did not
consider the appellant had adequately explained that delay. From
that decision the
appellant appeals.


[7]       During the course of submissions today the appellant has said that he learnt
of
the decision striking out his claim about two months after the decision was made,
which means that he delayed for 11 or 12 months
before making application to the
District Court to set aside the strike-out. His explanation for that delay is that his
financial circumstances were poor and that he was
not able to pursue the matter
earlier. But as noted, he is solicitor and has represented himself throughout. The
only direct costs
would have been a filing fee. The appellant's explanation for the
delay is not satisfactory. The delay is an extensive delay in the
context of the
proceeding.


[8]       Mr Singh in his helpful and full submissions in opposition to the application
identified the
relevant principles. He submitted that this was an appeal from the
exercise of a discretion and the Court should not interfere with
it unless it considered
the decision was clearly wrong: Alex Harvey Industries Ltd v Commissioner of
Inland Revenue  (2001) 15 PRNZ 361 (CA).


[9]       Both counsel have referred to and identified the case of Russell v Cox  [1983]
NZLR 654 as identifying the relevant principles to consider on an application of this
nature.


[10]      The case of Russell v Cox applies
in circumstances where a judgment or
decision has been obtained regularly. It does not apply in circumstances where the
judgment
has not been obtained regularly. It is necessary to examine the background

to the original strike-out in a little more detail than
was identified in Judge Wade's
decision to determine whether the strike-out was regularly obtained.


[11]   The application for
summary judgment had, as noted, been adjourned on a
number of occasions in the District Court prior to the call on 27 July 2007 when
both
it and the substantive proceedings were struck out.


[12]   On 31 May 2007, which proceeded by way of telephone conference
and was
the conference before the matter was struck-out on 27 July 2007, the Judge's record
of the file note records:

       · 
  May settle ­ parties meeting on site on 04/06/2007.
       ·    If parties do not settle, parties are to advise the Court, and
another
            teleconference to be considered.

[13]   The parties obviously did not resolve issues. The Court then gave notice
of
the date of 27 July in a document headed "Notice of Mention Date". The document
recorded:

       This case is on the Immediate
DC track in terms of the practice note issued
       in respect of Civil Case Management in this court.

       The above matter
has been set down Mention Only.

The hearing date of 27 July 2007 at 10.00 a.m. was set out.


[14]   When the matter came before
the Court on 27 July for mention the appellant
did not appear. In the appellant's absence the summary judgment application and
substantive
proceedings were dismissed by the Judge on his own initiative for failure
to prosecute.


[15]   It is inevitable, given the issues
raised in the substantive proceedings, namely
a disputed building contract with a counterclaim, that the application for summary
judgment was never going to succeed. It was misconceived. The application for
summary judgment was properly dismissed or struck-out.


[16]   But of concern to the Court, however, is the striking-out of the substantive
proceedings at the same time for non-prosecution.
While there was no appearance

on behalf of the appellant on that mention, as noted, there had been a number of
previous appearances
where either the appellant had appeared or if not, other counsel
had advised the Court of the position and the matter had proceeded
to the stage that
by consent it was being adjourned from time to time.


[17]   The record of the hearing before the Judge in May
speaks for itself as does
the Court advice to the parties as to the purpose of the call on 27 July. While, given
the time that had
passed and the issues, it was appropriate to strike-out the summary
judgment application, I am not able to accept it was appropriate
to summarily strike-
out the substantive proceedings. Even if the appellant had received advice of the
notice of the hearing date
and had failed to appear despite that advice, the clear
record was that the matter was before the Court for mention only. There was
not a
history of default by the appellant.


[18]   In those circumstances there is a substantial argument for the appellant that
the substantive proceedings should not have been struck out in the way they were
and the striking out and entry of judgment for the
respondent in those circumstances
was irregular. That is not a matter that was specifically addressed by Judge Wade in
his decision.


[19]   If I am wrong in approaching the matter in that way I go on to consider the
issue of whether or not it can be said there
has been a miscarriage of justice as
discussed in the case of Russell v Cox. I accept Mr Singh's submission that the
appellant's
failure to appear was neither reasonable nor excusable. The appellant's
failure to appear was entirely due to his own default. He
should have advised the
Court and the respondent of his change of address for service purposes.


[20]   The next consideration is whether the claim has substance. It is a contested
building
claim. What is not in issue is that some work has been carried out by the
appellant and, as he has identified, there is an affidavit
on the District Court file in
which the respondent says at one stage that if matters cannot be resolved he is
prepared to pay a sum
of $4,000 approximately. That suggests that the claim cannot
be said to be entirely without merit.

[21]   Next, it cannot be said
in this case that the respondent would suffer
irreparable injury or harm if the judgment was set aside and the substantive
proceedings
reinstated. The harm the respondent has suffered is essentially wasted
costs and that can be addressed.


[22]   The claim relates
to work carried out in 2006. Were it not for the strike-out
then even at this stage in 2009 the appellant would be free to bring
a claim in any
event. This is not a case where a successful plaintiff has essentially been deprived of
the fruits or benefits of
its judgment.


[23]   The delay in applying to set aside is a matter of concern to this Court as it
was to Judge Wade but when I
weigh the relevant factors in balance, the default on
the part of the appellant in failing to appear and in delaying in applying
to set aside
the judgment can, in my judgment, be addressed by way of costs. The interests of
justice do not support the maintenance
of the strike-out of the substantive
proceedings in the circumstances that they were struck out.


[24]   For those reasons the appeal
must be allowed. The decision of Judge Wade
in the District Court is set aside. The order made on 27 July 2007 striking out the
plaintiff's
substantive proceedings is itself set aside. To avoid doubt I confirm that
the application for summary judgment remains set aside
and dismissed.


[25]   As I have indicated the appellant has been the author of his own misfortune
in the way the matter progressed
and, through his actions (or inaction), has caused
the respondent unnecessary costs. He has effectively obtained an indulgence in
this
Court. Although the appeal has been successful, because of Mr Maqbool's actions
he is to pay costs, not only in this Court on
a 2B basis (with disbursements as fixed
by the Registrar), but the cost awards previously made in the District Court remain
payable
by him. They are not set aside.


[26]   For the avoidance of doubt I understand that those costs awards were made
on a 2B basis
on both the hearing when the substantive proceedings were set aside
and on the application before Judge Wade to set aside that decision.
Both of those

costs orders made against the appellant in the District Court remain and may be
enforced against the appellant as
may the order for costs in this Court.




                                              __________________________
            
                                 Venning J