Violi v GEMI 169 Pty Ltd

1. [1]

   By a notice of motion filed on 14 April 2026, the first and second respondents (together, GEMI), supported by the fifth respondent, Mr David, seek orders pursuant to Uniform Civil Procedure Rules 2005 (NSW) (UCPR) r 12.7(1) and 51.1(3) that the amended notice of appeal be dismissed for failure to prosecute the appeal with due dispatch. In the alternative, GEMI submits that the same order should be made in the exercise of the power conferred by rr 13.6(2) and 51.1(3) (non-appearance).

2. [2]

   GEMI’s application should be granted.

Background

1. [3]

   In the Court of Appeal alone, the procedural aspects of this matter have generated a vast number of communications among the parties. Many — perhaps all — of those communications were in evidence on the notice of motion. It is not necessary to refer to most of that material. It suffices to note that the way in which the appellants have proceeded has placed a significant burden on the respondents, and in particular on GEMI.

2. [4]

   The appeal is brought against a decision given by Peden J in the Commercial List of the Supreme Court. Her Honour gave reasons for judgment running to 501 paragraphs on 28 August 2025 and made final orders on 15 September 2025. Those proceedings concerned the enforcement of certain mortgages purporting to be signed by the first appellant, Mr Violi. The amounts secured were said to exceed $80 million. Although GEMI accepted that the relevant documents do not bear Mr Violi’s signature, GEMI contended that Mr Violi authorised the loans, knew of the mortgages and personally received the benefit of some of the money advanced: J[8]. At [16], her Honour said “the primary issue” was “whether Mr Violi signed or authorised the loans and mortgages over FLV’s properties”. Peden J found in favour of GEMI on that issue, as summarised at J[19]:

3. [5]

   On 1 October 2025, a notice of intention to appeal was filed, recording that Mr David Sweeney of East Sydney Law was the legal representative of the appellants. A notice of appeal was filed on 15 December 2025, and an amended notice of appeal was filed on 17 February 2026.

4. [6]

   The latter document challenges Peden J’s findings on the primary issue: Grounds 1-7. Those seven grounds are all expressed in different ways directed to the primary judge’s factual conclusions, without disclosing the basis for the challenge. Grounds 8-10 then challenge ultimate conclusions at a high level of generality. For example, Ground 8 is that the primary judge “erred in finding that [GEMI] were entitled to assert any rights in respect of the Griffith Property and the Strathfield Property.”

5. [7]

   On 10 February 2026, Mr Sweeney sent an email to the solicitor for GEMI, copied to the other parties, in which he said that the appellants had terminated his retainer and “instructed an alternative firm to act for them. I understand that firm will go on to the record as solicitors for the appellant subject to a conflict check.” Nevertheless, Mr Sweeney said that he had instructions to appear at a directions hearing the following day to explain the situation and to seek a two week adjournment. It might be noted that at no point has any other firm of solicitors gone on the record for the appellants.

6. [8]

   There was a directions hearing before the Registrar of the Court of Appeal on 11 February 2026. The Registrar granted leave to the appellants to file and serve an amended notice of appeal; made directions for the filing of any notices of contention or cross-appeal; and listed the matter further directions on 25 February 2026.

7. [9]

   At the directions hearing on 25 February 2026, the appellants were represented by counsel, instructed by Mr Sweeney. The appeal was listed for hearing on 5 and 6 May 2026 with an estimate of two days. The Registrar made orders for a timetable to prepare the matter for hearing on that basis. The orders included that the appellants file and serve:

   1. (1)

      the Red Appeal Book by 6 March 2026;

   2. (2)

      the Black Appeal Book and the Blue Appeal Book by 20 March 2026; and

   3. (3)

      their written submissions and chronology by 30 March 2026.

8. [10]

   The appellants substantially complied with the first of those orders by filing and serving the Red Book on 9 March 2026. That was, however, the last substantive step taken by the appellants in the proceedings. At no time did the appellants file their submissions or the Blue or Black Appeal Books, despite the further orders that I made on 28 April 2026, discussed below.

9. [11]

   For their part, on 31 March 2026, GEMI and the Registrar-General of NSW (the eighth respondent) did what they could to comply with the directions that had been made by the Registrar on 25 February 2026 by filing and serving written submissions on their notices of contention and on GEMI’s notice of cross-appeal.

10. [12]

    An enormous number of communications ensued in which the solicitors for GEMI and other respondents pursued Mr Sweeney over the appellants’ non-compliance with the directions made on 25 February 2026. The thrust of Mr Sweeney’s responses was that he would respond when he had instructions. The respondents also provided a large volume of information to Mr Sweeney in order to assist him, in particular in complying with the order that the appellants prepare the Blue Appeal Book.

11. [13]

    I accept the submissions made on behalf of GEMI that it has taken any steps it could to progress the appeal; and on behalf of Mr David that the only parties putting any effort into the appeal appear to have been the respondents: Tcpt, 28 April 2026, 12.20.

12. [14]

    After 5pm on Friday 20 March 2026, Mr Sweeney filed a notice of intention to cease to act for the appellants. The notice stated that after 28 days from the date of service of the notice, Mr Sweeney would file in the registry of the court and serve a notice that he had ceased to act. By email on 24 March 2026, the solicitors for GEMI sought an update as to the status of the appellants’ legal representation, and pointed out that Mr Sweeney remained on the record as the solicitor for the appellants.

13. [15]

    Mr Sweeney responded by email on 25 March 2026 acknowledging that he remained on the record. Later that day he sent a text message to the solicitor for GEMI stating:

14. [16]

    The following day, 26 March 2026, Mr Sweeney sent an email to the solicitors for GEMI stating that a law firm was still considering whether it would go on the record as solicitors for the appellants, and that in the meantime Mr Sweeney was “putting together a proposed amended timetable”. Although Mr Sweeney was unable to obtain instructions as to an amended timetable, on 27 March 2026 he put forward a tentative proposal which included the filing and service of the Black and Blue Appeal Books by 9 April 2026, and the appellants’ written submissions and chronology by 16 April 2026. The Registrar-General, the eighth respondent, opposed the orders.

15. [17]

    On 31 March 2026, the solicitors for GEMI sought to have the matter re-listed before the Registrar. In the course of an exchange of communications, the Registrar responded that the parties could propose consent orders regularising the timetable to be made in chambers, but that if it was sought to vacate the hearing dates, it would be necessary to file a notice of motion. No such notice of motion was filed. Nor were any consent orders put forward by the parties to regularise the timetable. The Registrar concluded on 2 April 2026 that there was little utility in relisting the proceedings in the circumstances.

16. [18]

    The solicitors for GEMI continued to pursue Mr Sweeney over the appellants’ failure to progress the appeal, to no avail.

17. [19]

    GEMI then filed the notice of motion now before the Court on 14 April 2026. The motion was served on Mr Sweeney, who remained the solicitor on the record. Mr Sweeney did not engage with the representatives of the respondents in respect of the notice of motion; but he did continue to act for the appellants. In particular, Mr Sweeney sent an email to the solicitors for GEMI on 17 April 2026, copied to the parties, noting, with respect to a proposed communication with the Registry to correct an error in the name of the second appellant, “That is not opposed”.

18. [20]

    Mr Sweeney filed a notice of ceasing to act on 21 April 2026. That notice provided the email address and telephone number of the appellants last known to Mr Sweeney. It might be noted that the notice failed to refer, in the relevant part, to the second appellant; but nothing of substance turns on that.

19. [21]

    There was a directions hearing on 22 April 2026, at which the Registrar made directions for the hearing of GEMI’s notice of motion on 28 April 2026, including as to the filing and service by the appellants of evidence and submissions.

20. [22]

    A Mr A Brownlee, who made clear that he was not a solicitor, was given leave to appear “for the appellant”. He had attempted without success to file an affidavit in the proceedings by email the night before. Given that Mr Brownlee was neither a party nor a solicitor for a party, the failure of that attempt is unsurprising. The Registrar told Mr Brownlee that “emailing a document is not filing”, and expressly said that the affidavit was not on the file: Tcpt, 22 April 2026 at 1.44-49.

21. [23]

    Mr Brownlee submitted to the Registrar on 22 April:

22. [24]

    When asked from whom he was taking instructions, Mr Brownlee answered that it was the first appellant, i.e., Mr Violi. When asked who would be attending to respond to the notice of motion “next Tuesday”, i.e., on 28 April 2026, Mr Brownlee said that lawyers would be briefed to appear.

23. [25]

    On 22 April 2026, the solicitor for GEMI sent a copy of the directions that had been made that day to the parties, including to the email address in Mr Sweeney’s notice of ceasing to act. She also forwarded that email to Mr Sweeney, who acknowledged receipt. On 23 April 2026, the solicitor sent a text message to the telephone number in the notice of ceasing to act, drawing attention to the email that had been sent the day before “with orders made by the Court of Appeal for the hearing of the GEMI Parties’ notice of motion, which is listed for hearing on 28 April 2026.”

24. [26]

    In the circumstances, I am satisfied that the notice of motion was served on the appellants, and that they were aware of the fact that the notice of motion was listed for hearing on 28 April 2026.

25. [27]

    The appellants filed no evidence or written submissions pursuant to the directions made on 22 April 2026 for the hearing of GEMI’s notice of motion — either prior to 28 April or after. There was no appearance by or on behalf of the appellants when the matter was called on 28 April 2026. Mr Ashhurst of Senior Counsel, who appeared with Mr McGirr for GEMI, moved on his client’s notice of motion.

26. [28]

    One of the matters of prejudice on which Mr Ashhurst relied was his own impending retirement from practice. He had appeared at trial and, as his instructing solicitor deposed in her affidavit, any replacement senior counsel would require a significant amount of additional preparation time given the scope of the matter. Mr Ashhurst’s last day in chambers was planned to be on 15 May 2026. However, he very fairly informed me that he could appear on 29 or 30 June 2026.

27. [29]

    In the circumstances, and not without considerable hesitation, I made the following orders:

    1. (1)

       Vacate the hearing dates of 5 and 6 May 2026.

    2. (2)

       List the appeal for hearing on 29 and 30 June 2026.

    3. (3)

       Direct the appellants to file and serve their submissions on the appeal, their chronology and the Black and Blue books by 5:00 pm 12 May 2026.

    4. (4)

       Stand the first and second respondents’ notice of motion over to 15 May 2026 before me.

    5. (5)

       The appellants are to pay the respondents’ costs of today and any costs thrown away by reason of order 1.

    6. (6)

       Direct the registry to notify all parties of these orders.

    7. (7)

       Direct pursuant to rr 13.6 and 51.1(3) of the Uniform Civil Procedure Rules 2005 (NSW) that a notice be served on the appellants advising them that the proceedings may be dismissed if there is no appearance by or on behalf of the appellants on 15 May 2026.

    8. (8)

       Vacate the listing of this matter on 29 April 2026.

28. [30]

    As I said immediately before making those orders:

29. [31]

    Rule 13.6 provides as follows:

30. [32]

    (3) This rule does not restrict any other power of the court to dismiss proceedings. Pursuant to r 51.1(3), “Subject to this Part, the other provisions of these rules apply, so far as applicable, to proceedings in the [Court of Appeal]”. By subr (4), the rules referred to in subrule (3) have effect (a) on the basis that a reference to a plaintiff includes a reference to an appellant, and (d) subject to “such other modifications as are necessary”. Rule 13.6 is in that way picked up by r 51.1(3).

31. [33]

    The words “hearing” and “adjourned hearing” as used in r 13.6 are not defined. There is no reason to give them a confined meaning in this context, particularly when the notice of motion that had been listed for hearing was one for summary termination of the whole proceeding.

32. [34]

    The reference to r 13.6 in order 7 made on 28 April 2026 was expressly directed to the possibility that there might be “no appearance by or on behalf of the appellants on 15 May 2026”. The significance of 15 May was that by order 4 I had stood the hearing of GEMI’s notice of motion for dismissal of the appeal for want of due despatch over to that date. Accordingly, if the requisite notice was given and there was no appearance by or on behalf of the appellants at the hearing of the notice of motion on 15 May, the power to dismiss in r 13.6 would be engaged.

33. [35]

    Notice was given to the appellants in accordance with r 13.6. The appellants were also given notice of the orders made on 28 April 2026, and a copy of the transcript of that date. Each of those documents was served under cover of a letter written to the appellants on 30 April 2026 by the solicitors for GEMI, which I am also satisfied the appellants received. That letter quoted the passage of transcript referred to above in which I warned that the proceeding would be liable to be dismissed if no progress had been made.

34. [36]

    Mr Kewley of counsel, who appeared for the appellants on 15 May 2026 on the limited basis discussed below, confirmed that the appellants had received those documents. I am satisfied that the appellants were on notice of the risk they ran if they failed to make progress in the preparation of the appeal or failed to appear on 15 May 2026, namely, the risk that their appeal would be dismissed.

35. [37]

    No such progress was made. Crucially, the appellants failed to comply with order 3 which I made on 28 April 2026 (that the appellants file and serve their submissions on the appeal, their chronology and the Black and Blue books), either by the time I ordered (5:00 pm 12 May 2026) or at all.

36. [38]

    Mr Kewley appeared remotely by audiovisual link on 15 May 2026. As to his own brief, in summary, he informed the court that he was not briefed by a solicitor; that he had been instructed to appear directly by Mr Violi in a telephone conversation; that (although the topic had not been separately raised) he understood that Mr Violi intended Mr Kewley’s brief to extend to the corporate appellant; and that he knew very little about the matter and had only been involved since 13 May 2026. Most significantly for present purposes, Mr Kewley said that his brief extended only to applying to adjourn GEMI’s notice of motion, as opposed to appearing on the hearing of the notice of motion itself: Tcpt, 15 May 2026 at 3.13-27; 18.34-19.9. Mr Kewley pithily summarised the basis of his application as follows: “we should have one more bite at the cherry in terms of getting material in prior to the hearing of the appeal”: Tcpt at 3.21.

37. [39]

    I refused the appellants’ application to adjourn GEMI’s application for dismissal on the basis that I would provide my reasons later. These are those reasons.

38. [40]

    There was no notice of motion formalising the appellants’ application to adjourn GEMI’s application to dismiss the appeal. Having flagged in an email to the court late on the preceding afternoon that he was instructed to make such an application, Mr Kewley advanced the application orally on 15 May, ultimately submitting (when pressed) that the appellants were seeking an adjournment until 11 June 2026: Tcpt at 14.25. When asked whether he relied on any affidavit in support of the application, Mr Kewley had at first said no: Tcpt at 3.48-4.3. It then emerged in submissions that he wished to rely on an unfiled affidavit of Mr Brownlee made on 21 April 2026 (being the affidavit referred to above at [22]) Tcpt at 8.14ff. That immediately gave rise to a dispute about whether in the circumstances the appellants should be permitted to rely on the affidavit for purposes of their application to adjourn the hearing of GEMI’s notice of motion.

39. [41]

    Mr Kewley emailed a copy of the affidavit, together with what was said to be the annexure to it (a title search), to my chambers. Copies were provided to the respondents’ legal representatives for the first time.

40. [42]

    The respondents submitted that the appellants should not be permitted to rely on Mr Brownlee’s affidavit for several reasons.

41. [43]

    First, the respondents had been given no notice of the affidavit. (It will be remembered that the Registrar had made orders on 22 April 2026 for the filing and service of any affidavits on which the appellants wished to rely in resisting GEMI’s application for summary dismissal. The appellants had failed to comply with those orders.)

42. [44]

    Secondly, on the afternoon of 22 April 2026, following the directions hearing that day, the solicitors for GEMI had sought a copy from Mr Brownlee of his affidavit. None had been forthcoming.

43. [45]

    Thirdly, the respondents were prejudiced by the contents of the affidavit. The deponent asserted at par 5 that “Mr Violi exhausted in excess of $4M in the running of his defence in 2025 and in the lead up to same and since August 2025”. Paragraph 6 referred to certain financing arrangements that required the provision of security (discussed further below). The deponent asserted that difficulties involving the secured property “have now been resolved with the caveators by way of a ‘Side Deal’ permitting the registration of the incoming mortgagee”. The respondents submitted that if they had had notice of the contents of the affidavit, they would have taken steps:

    1. (1)

       to contact LDC Infrastructure Holding Company Pty Ltd, which was identified as the caveator on the title search, to investigate the “side deal”;

    2. (2)

       to issue a notice to produce for copies of the facility agreements, if any, et cetera; and

    3. (3)

       to issue a notice to produce seeking communications between the appellants and the incoming financier in respect of the security arrangements.

44. [46]

    Importantly, Mr Kewley accepted that those were matters of prejudice: Tcpt, 15 May 2026, 12.30-35. He was constrained to ask for an adjournment of his application “for say a week or a few days” in order to permit the respondents to take the steps referred to above: Tcpt at 12.25. That amounted to an application to adjourn his own adjournment application, in support of which there was no evidence. (That is to say, in light of the admitted prejudice to the respondents, it was not open to the appellants to rely on the Brownlee affidavit for the purpose of seeking to adjourn their own adjournment application.) I rejected Mr Brownlee’s proposal.

45. [47]

    Fourthly, the respondents submitted that the affidavit was inadmissible, in particular as to the financing arrangements referred to in par 6. The affidavit disclosed a number of difficulties on its face.

    1. (1)

       For example, par 6 began: “We secured in February 2026 a loan facility of $500K against property valued as ‘in a fire sale’ in excess of $1.6M held by the son of the First Plaintiff/Appellant, Anthony Christopher Violi via his family trust: …” It was wholly unclear what the deponent was asserting had been “secured”: some kind of in-principle commercial agreement; or a binding term sheet; or an executed facility agreement. In circumstances where no foundation was laid for that statement (that is to say, on what basis Mr Brownlee was making it), the respondents objected that it appeared to be hearsay.

    2. (2)

       Another example was the bald conclusion, later in par 6, for which there was again no foundation: “The mortgage as is the case with other securities against the son’s property in this matter was obtained by fraud.”

    3. (3)

       Another example was that it was said that the property which was to constitute the security for the loan was held by Mr Violi’s “son”, whom the deponent acknowledged was not a party to the present proceedings. Paragraph 7 of the affidavit referred to a period of time in which “to permit the fresh loan facility of $500K to be settled made available and the appellants new Lawyers … placed in funds”. That implied that the son was prepared to permit the whole of the proceeds of a loan which was to be secured against his property to be applied for the purposes of litigation to which he was not a party. That evidence would have to be hearsay, but its source was not identified.

46. [48]

    I indicated in the course of argument that I was inclined to refuse to allow the appellants to rely on Mr Brownlee’s affidavit for the purposes of their oral adjournment application (Tcpt at 12.43), but I invited the parties to address me on the alternative bases that the appellants were or were not permitted to rely on Mr Brownlee’s affidavit (Tcpt at 12.41-44). I said that I would give my ruling on that issue “in the course of giving the judgment on the matter”: Tcpt at 12.40-41. Ultimately, I formed the view that even if the appellants were permitted to rely on Mr Brownlee’s affidavit for the purposes of their adjournment application, the affidavit had so little weight that it would make no difference to the disposition of that application, as explained below. I refused the appellants’ application to adjourn GEMI’s r 12.7 application on that basis.

47. [49]

    That being so, it is not strictly necessary to rule on the question whether the appellants should have been allowed to rely on Mr Brownlee’s affidavit. But for completeness, I consider that they should not. The respondents’ submissions as to why the appellants should not be permitted to rely on Mr Brownlee’s affidavit on the adjournment application were compelling and must be accepted. Indeed, the appellants had no answer to those submissions.

48. [50]

    It might be noted that I would not have permitted the appellants to rely on Mr Brownlee’s affidavit for the purposes of resisting GEMI’s notice of motion if they had sought to do so. As already noted, the Registrar had made directions on 22 April 2026 for the appellants to serve evidence in answer to GEMI’s notice of motion before the listing of that application before me on 28 April 2026. The appellants failed to do so, notwithstanding that Mr Brownlee’s affidavit had been made (and unsuccessfully sought to be filed) on 21 April 2026. In circumstances where there was no appearance for the appellants on 28 April, GEMI’s notice of motion had been stood over until 15 May 2026. If the appellants had nevertheless attempted to rely on Mr Brownlee’s affidavit in answer to GEMI’s application for dismissal, I would not have permitted them to do so in light of the matters (including the prejudice to the respondents) referred to above. And there was no good reason why the appellants should be in any better position to rely on the same affidavit for purposes of their own oral application for adjournment of GEMI’s application for dismissal.

49. [51]

    In any event, even if (contrary to my conclusion above) the appellants were permitted to rely on Mr Brownlee’s affidavit, and even if it were admitted in its entirety over the respondents’ evidentiary objections, that evidence could have very little weight in the circumstances for the following reasons.

    1. (1)

       To the extent that Mr Brownlee asserted that various things had already occurred, the assertions appeared to be, at the very least, overstated. For example, at par 4 Mr Brownlee said: “We have as at the date herein secured a Mid-size Law Firm to act in the running of the Appeal set down for early May 26.” Whatever else “secured” may mean, it is apparent that no other firm of solicitors has had the carriage of the appeal (in the sense of going on the record or performing the necessary work) at any time since 21 April 2026. Similarly, to the extent that it was asserted at par 6 that “a loan facility of $500K” had been “secured in February 2026”, there is no evidence that any money has ever actually been advanced. In this respect it is significant that Mr Kewley informed the court that he had spoken with a solicitor, a Ms Evert, who had (so he understood) agreed to go on the record to act in the matter, subject to resolving funding issues (including the placing of funds into her firm’s trust account). The inference to be drawn is that, whatever else may be the case, the funding issues have not been resolved.

    2. (2)

       In any event, the affidavit does not address the current position. There is no evidence as to what, if anything, has happened in the relatively lengthy period of more than three weeks between 21 April and 15 May 2026. In particular, the affidavit cannot provide any explanation why, if the matters deposed to in the affidavit were correct as at 21 April 2026, the orders that I made on 28 April 2026 for the filing and service of submissions, etc, were not complied with.

    3. (3)

       Nor, in light of the matters discussed above, does the affidavit provide any sufficient basis for thinking that the current position is set to improve in the near future or, for that matter, at all. Mr Kewley submitted that the adjournment should be granted because the explanation for the appellants’ failure to progress the appeal to date was a shortage of funding, rather than a lack of intention to prosecute the appeal. Even if that were so, that would be the start of the inquiry, not the end of it (as explained further below in the context of GEMI’s notice of motion).

50. [52]

    The little weight to be given to Mr Brownlee’s evidence in the circumstances fell far short of what was necessary to warrant adjourning GEMI’s application to dismiss the appeal. That application had already been stood over once, to 15 May 2026, in circumstances where the appellants had failed to appear on 28 April 2026. I had explained in the clearest possible terms on 28 April that if no progress was made, the appellants should expect that the appeal would be dismissed on 15 May. The appellants then made no progress at all in advancing the appeal in that period. Their application for adjournment until 11 June 2026 amounted to seeking the indulgence of a further four weeks to see if they could put their house in order and serve the necessary documents. But on what is currently known, even if (contrary to my conclusion above) the appellants were permitted to rely on Mr Brownlee’s affidavit, giving that evidence (which only addressed the position as at 21 April 2026) the weight it deserved, there was no sufficient basis for thinking that there would be any real utility in the adjournment. (That conclusion is even clearer in light of my conclusion that the appellant should not be permitted to rely on Mr Brownlee’s affidavit on their application for adjournment.)

51. [53]

    In the meantime, by contrast, the respondents, who are represented by multiple counsel, have continued and will continue to suffer prejudice by incurring costs. Given that the appellants’ own explanation for failing to progress the matter appears to be a lack of funds to do so, it must be doubted whether those costs will ever be recoverable.

52. [54]

    There was a further way in which GEMI would suffer prejudice if the notice of motion for dismissal was adjourned, for a second time, until 11 June 2026. The appeal has been listed for hearing on 29 and 30 June 2026. Those dates were chosen because they are the last days on which GEMI’s Senior Counsel, who appeared at trial, is available to appear at the hearing of the appeal before he retires from practice. If those dates were lost, GEMI would be required to brief new Senior Counsel, at additional expense which may well never be recoverable. There would have to be a powerful reason for vacating, for a second time, the hearing dates for this appeal.

53. [55]

    The respondents rightly submit that the amended notice of appeal has given them little or no notice of the arguments that they will have to meet at the hearing of a fact appeal that has been listed for two days. The optimistic premise of the appellants’ adjournment application is that they will manage (contrary to their conduct to date) to prepare the Blue and Black appeal books and file and serve their submissions by 11 June 2026. That would leave just 18 days before the hearing of the appeal in which to complete two rounds of submissions: the respondents’ and the appellants’ in reply. Even assuming that the appellants served all the outstanding documents by 11 June, the respondents’ preparation for the appeal would be unfairly compressed. The practical effect of granting the adjournment would thus be to grant the appellants, who are already in significant default, a further indulgence in circumstances that will work prejudice to the respondents.

54. [56]

    All those reasons, together with the requirements of ss 56, 57, 58 and 59 of the Civil Procedure Act 2005 (NSW), compelled the conclusion that GEMI’s notice of motion for dismissal should be determined without further delay. On that basis I refused the appellants’ oral application for adjournment of GEMI’s notice of motion.

55. [57]

    After I ruled on the appellants’ adjournment application, Mr Kewley withdrew on the basis that his instructions extended only to appearing on that application. In the result, there was no appearance by or on behalf of the appellants at the hearing of GEMI’s notice of motion seeking summary dismissal. In the circumstances, the fact that the appellants instructed counsel to appear on their adjournment application but not at the hearing of GEMI’s notice of motion can only be seen as a deliberate decision made in the face of the warning given on 28 April 2026.

56. [58]

    For the reasons given above, the appellants’ failure to appear at the hearing of the notice of motion enlivened the power in r 13.6 to dismiss the appeal, a matter to which I will return below.

Applicable principles

1. [59]

   Rule 12.7 provides as follows:

2. [60]

   The principles applicable to r 12.7 were recently summarised by Kirk JA in Allchin v Hunter Water Corporation (No 3) [2025] NSWCA 75. His Honour said:

3. [61]

   As to the significance of delay, an important consideration is whether there has been any constructive activity: Ghosh v Ninemsn Pty Ltd (2015) 90 NSWLR 595; [2015] NSWCA 334 at [41].

4. [62]

   What engages the power is an existing state of affairs: “If a plaintiff does not prosecute the proceedings with due despatch”. The existence of that state of affairs will generally be established by reference to steps the plaintiff should have taken to date, but has not taken, or has taken only belatedly. To that extent, the power is backwards-looking. On the other hand, in exercising the discretion whether to dismiss the proceedings (or to make some “other order”), the court must have regard to, among other things, the overriding purpose in s 56 of the Civil Procedure Act (facilitating the just, quick and cheap resolution of the real issues) and to the dictates of justice (s 58). The balance referred to in Witten v Lombard Australia Ltd [1968] 2 NSWR 529 at 534 requires the court to consider not only past prejudice, but the prejudice to the plaintiff if the proceeding is dismissed, and the prejudice to the defendant if it is not. It follows that, whatever may be the plaintiff’s explanation for the existing state of affairs, exercising the discretion with regard to the justice of the case will often involve an assessment, on the material before the court, about whether or not that state of affairs is set to continue. To that extent, the power is also forwards-looking.

Disposition of GEMI’s notice of motion

1. [63]

   The other active respondents support GEMI’s application for dismissal.

2. [64]

   For the following reasons, I am satisfied that the appellants have not prosecuted the appeal with due despatch so as to engage the power in UCPR r 12.7.

3. [65]

   First, the context in which the r 12.7 issue arises is that the appeal arises out of reasons for judgment given on 28 August 2025 and final orders made on 15 September 2025. That is already a long time ago.

4. [66]

   Secondly, the appellants have done little “constructive” work to advance the real questions arising on the appeal at any point in time. The amended notice of appeal filed on 17 February 2026 is far from illuminating in delimiting the issues. Nothing has been done to narrow the issues in the three months since then. The only progress of any kind in that period has been administrative in nature: the filing of the Red Book on 9 March 2026. That was more than two months ago. And that was a relatively undemanding task, particularly when compared with what would be involved in preparing the Blue Books in a fact appeal such as this.

5. [67]

   Thirdly, the appellants provided no substantive responses to the respondents’ many attempts to prompt the appellants into action.

6. [68]

   Fourthly, the appellants have failed to appear on more than one occasion, most recently on 28 April 2026 and on 15 May 2026 (i.e., after the application for adjournment was refused and Mr Kewley withdrew). As noted above, the failure to appear on 15 May must be seen as deliberate conduct in the face of the warning given on 28 April.

7. [69]

   Fifthly, the appellants have failed to comply with orders as follows:

   1. (1)

      Orders made on 25 February 2026 by the Registrar for the filing and service of the appellants’ submissions and chronology, and the Black Book and Blue Book.

   2. (2)

      Orders made by the Registrar on 22 April 2026 for evidence and submissions with respect to the hearing of GEMI’s notice of motion.

   3. (3)

      Orders I made on 28 April 2026 for the filing and service of the appellants’ submissions and chronology, and the Black Book and Blue Book.

8. [70]

   Sixthly, on the evidence before the court, there is no reason to think that the appellants presently have any lawyers acting on the appeal. That is so despite the appellants’ predictions made to the court on that issue. Mr Brownlee had informed the Registrar on 22 April 2026: “Lawyers will be on by then” (i.e., by 28 April, when the notice of motion was listed for hearing): Tcpt, 22 April 2026 at 3.35; see also at 4.41-44. That plainly did not occur: there was no appearance on 28 April. It appears that no lawyer has been engaged since then. Even if the appellants were now to succeed in retaining new legal representation, those lawyers would be in effect starting from scratch. That would in itself amount to a failure to prosecute with due dispatch an appeal first commenced last year.

9. [71]

   Seventhly, the appellants could not have been more clearly warned that their proceeding was liable to be dismissed if no progress was made in the preparation of the appeal between 28 April and 15 May 2026. Yet that was exactly what happened. On the evidence before the court, the appellants have done nothing to advance the appeal in that period.

10. [72]

    The conclusion to be reached is not only that the appellants have not prosecuted their appeal with due despatch, but that there is at present no reason to think that they will now commence to do so.

11. [73]

    It follows from the conclusion that the appellants have not prosecuted their appeal with due despatch that the power in r 12.7 engaged. As noted above, the power in r 13.6 is also engaged. (A further source of power may well be s 61(3)(a) of the Civil Procedure Act: failure to comply with directions).

12. [74]

    Rule 12.7 confers a discretion: Ghosh at [38]. The same is true of r 13.6. It was not suggested that, in the circumstances of this case, the discretionary matters that would be relevant to the exercise of the power in r 13.6 would be any different from those relevant under r 12.7.

13. [75]

    As to discretion, in addition to the matters referred to above engaging r 12.7, a further factor in favour of dismissing the appeal is that the respondents are facing actual prejudice.

    1. (1)

       They have continued to incur costs which it is doubtful will ever be recovered. These include GEMI’s costs of attempting to assist the appellants to prepare the Blue Books; the costs of preparing GEMI’s submissions on the notice of contention; and the active parties’ costs of multiple appearances. For his part, the fifth respondent, Mr David, a solicitor, has had to retain his own lawyers after LawCover, his insurer, refused to meet the costs of the appeal: Affidavit, Mark Kryakos, 24 April 2026 at pars 4-5.

    2. (2)

       As explained above, even if the appellants undertook all outstanding steps by 11 June 2026 (the date that had been sought in their oral adjournment application), that would unfairly compress the respondents’ preparation time.

    3. (3)

       Moreover, on the evidence before the court, there is a very real prospect that if the appeal is not dismissed at this stage, the appellants might fail to prosecute their appeal with due despatch — whether by 11 June or at all — in the period leading up to the hearing of the appeal on 29 and 30 June 2026. That would most likely result in one of three outcomes:

14. [76]

    GEMI also submits, as a matter relevant to discretion, that the appellants’ prospects of success on the appeal are weak. As Kirk JA acknowledged in the summary in Allchin, an appellant’s prospects are potentially relevant to the exercise of the discretion. Here, GEMI submits that the essence of the notice of appeal is a challenge to the critical finding of fact made by the primary judge (that Mr Violi knew of and authorised GEMI’s loans and mortgages). It is submitted that those findings depended on, amongst other matters, a finding that Mr Violi’s evidence was not credible: see J[173]-[178]. At least to that extent, given the principles set out in Fox v Percy (2003) 214 CLR 118; [2003] HCA 22, GEMI submits that the appellants’ prospects are poor.

15. [77]

    While there may well be force in that argument, there are limits to the use that it is sensible or desirable to make of assessments of prospects on an interlocutory application such as this. I am not in a position to form any concluded view about prospects. In particular, I am in no position to say, and I am not being asked to say, that the appeal has no reasonable prospects of success.

16. [78]

    That being so, I will proceed on the basis of an assumption that one or more of the appellants’ grounds of appeal are reasonably arguable. That assumption favours the appellants in the discretionary balance. An appellant is ordinarily entitled to have its reasonably arguable grounds determined on their merits, not summarily. The prejudice to the appellants if the appeal is dismissed summarily is the loss of the opportunity to have their appeal determined on its merits. That is a weighty consideration against granting GEMI’s application.

17. [79]

    I have nevertheless concluded that GEMI’s application should in all the circumstances be granted.

18. [80]

    Given that the appellants neither filed written submissions nor appeared at the hearing of GEMI’s notice of motion on 28 April and 15 May 2026, they have not made submissions in answer to the application for dismissal. Nor have the appellants put any evidence before the court on that question. To the extent that it should be understood from Mr Kewley’s submissions on the adjournment application that the explanation for the appellants’ lack of progress is a lack of funding, there is no evidence to support that explanation. But even if there had been some evidence of a lack of funding, that would be the start, not the end, of the issue. It would be contrary to the overriding purpose in s 56 of the Civil Procedure Act — to facilitate the just, quick and cheap resolution of the real issues in proceedings — to permit a state of affairs to continue indefinitely in which the appeal was effectively put on hold because the appellants were unable to progress it. Yet, on the assumption that the lack of progress is due to a lack of funds, that would be the inference to draw on the material before the court. In the absence of evidence as to (1) the scope of any funding issues and (2) the extent to which there was a reasonable prospect that the funding issues would be overcome in the near future, there would be no reason to think that the current situation was set to improve. In other words, on the material before the court, rather than assisting the appellants, any funding difficulties would be a reason for exercising the discretion in favour of dismissal.

19. [81]

    The appellants have not pointed to any other factor, and I am not aware of any, which would militate against granting GEMI’s application.

20. [82]

    As noted above, the present application falls to be determined in light of the overriding purpose in s 56. It was recently said in S&P Gomes Pty Ltd t/as Cohuna Hotel Motel v Mohan Sundar t/as Sun Legal [2026] NSWCA 85 at [26], a r 12.7 case involving an appeal, that the “determination of whether or not a particular conclusion or outcome is just is a function of a number of things, including whether it is quick and cheap.” It is necessary to consider all three matters and to determine on balance how they operate in combination.

21. [83]

    Moreover, the civil procedure regime contemplates that an order may be just overall while tolerating an element of injustice (i.e., prejudice) from the perspective of a particular litigant. Thus, s 58(2)(b)(vi) of the Civil Procedure Act refers to “the degree of injustice that would be suffered by the respective parties as a consequence of any order or direction”. Viewed solely from the appellants’ perspective, there will always be an element of injustice in depriving a litigant of the opportunity to have a reasonably arguable question determined on its merits. But if that were the end of the matter, the powers conferred by UCPR rr 13.6 and 12.7 would add little if anything to the general power of summary dismissal in r 13.4. To act in accordance with the dictates of justice it is necessary to consider what is just from both parties’ perspectives. Where, as here, what engages the court’s power is a failure to prosecute proceedings with due despatch, the object of eliminating delay beyond what is reasonably required to prepare the matter for a fair and just final determination (s 59) has particular significance. Given the nature of the delay (including the vacating of the hearing of a two-day appeal and the appellants’ failure to comply with two sets of directions for the filing of critical documents such as appeal books and submissions), the associated wasted costs and the prejudice to the respondents, the overall justice of the case requires intervention by the court.

22. [84]

    Rule 13.6(2) confers only a power of dismissal. Rule 12.7 confers a power of dismissal or to “make such other order as the court thinks fit”. The appellants have not suggested any “other order” that would be appropriate, but in light of their unsuccessful application for adjournment of GEMI’s notice of motion, it may be inferred that they would submit that a further set of orders should be made requiring them to complete the outstanding procedural steps by 11 June 2026. For the reasons given earlier in refusing the adjournment application, I would not consider that an appropriate order. In light of the submissions made by Mr Kewley on the adjournment application about the lack of availability of the proposed solicitor, Ms Evert (Tcpt, 15 May 2026 at 2.18; 7.25; 14.24), there is also no reason to think that there would be any utility in orders requiring the appellants to complete the outstanding steps before 11 June 2026. And for essentially the same reasons, I do not consider that it would be appropriate to make a self-executing order dismissing the proceeding unless the appellants completed the outstanding steps before any particular date. Such an order would have the additional disadvantage that it would not give the respondents the finality to which I consider they are entitled in light of the appellants’ failure to prosecute the appeal with due despatch.

23. [85]

    In all the circumstances, I do not consider it appropriate to make any “other order” that would amount to giving the appellants a third chance or “bite at the cherry”. That is not least because there is no sufficient reason to think that the appellants, having failed to take their first and second chances, would now take a third.

24. [86]

    The amended notice of appeal should be dismissed with costs. That will be the order of the court.

25. [87]

    GEMI’s notice of cross-appeal (which sought only remitter to the Equity Division for determination of alternative claims that the primary judge had not determined) was expressed to be brought only in the event that the main appeal was allowed. It follows from the dismissal of the amended notice of appeal that (as GEMI sought in its notice of motion) the notice of cross-appeal should also be dismissed. I will make an order to that effect. Given the contingent nature of the cross-appeal, and in circumstances in which GEMI’s written submissions on the cross-appeal occupied only four paragraphs which did no more than explain the basis on which the cross-appeal was brought, I do not consider it appropriate to make a separate order as to the costs of the cross-appeal.