Cleary v Kremer

By an amended notice of motion dated 14 September 2016 and filed in court on 26 October 2016 (“the motion”) the defendant, without entering an appearance or submitting to the jurisdiction of the Court, seeks the following orders:

The orders sought are opposed by the plaintiff.

In support of the orders sought the defendant read the following affidavits:

In addition, the defendant relied on two expert opinions of Paul Dean, Barrister-at-Law of the London Bar, dated 12 May 2016 and 2 November 2016. The opinions of Mr Dean go to various matters of English procedural law. I will return to aspects of those opinions in due course.

The plaintiff read the following affidavits:

It should be noted that the affidavits of Mr Poulden of 21 October 2014 and 28 May 2015 were in fact annexed to the first of Mr Craney’s affidavits.

On 21 August 2013 the plaintiff, who is a resident of NSW, filed a statement of claim in which she pleaded a case in negligence and breach of contract against the defendant. In short, the plaintiff alleges that the defendant held himself out to be, and was in fact, a qualified medical practitioner specialising in cosmetic surgery, who practiced in London. It is the plaintiff’s case that she consulted the defendant for advice in relation to, and in contemplation of, surgical procedures which he subsequently performed, and which involved liposuction, injection and surgical correction to the plaintiff’s stomach area, thighs and buttocks.

The plaintiff alleges that in breach of his contract with her, the defendant failed to (inter alia) exercise reasonable skill and care in the conduct of those surgical procedures. She further alleges that as her treating surgeon, the defendant owed her a duty to (inter alia) exercise due and proper care and skill in carrying out any surgical procedure, and in warning, informing and advising her of any material risk which was inherent in such procedure. The plaintiff alleges that in breach of that duty, the defendant failed to advise her that there was a material and inherent risk in the procedures which were subsequently carried out, and that he failed to exercise reasonable skill and care in performing them. In particular, the plaintiff alleges that her right buttock was deformed by one procedure, by reason of which she has suffered loss and damage.

There is no issue that pursuant to r. 6.2(4)(a) of the Rules the time for service of the statement of claim on the defendant was six months from the date of filing. Accordingly, the statement of claim was required to be served by 21 February 2014. There is no also issue that the statement of claim was not served by that time, nor is there any issue that the plaintiff did not seek an extension of time for the service of the statement of claim before the expiry of that six month period. In these circumstances, the statement of claim became stale on 22 February 2014.

On 12 May 2014, Mr Poulden, the plaintiff’s solicitor, purported to serve the statement of claim on the defendant by mail. In his affidavit of 26 October 2016 Mr Poulden stated (inter alia) as follows:

There was no response from the defendant to this purported service. There was a further attempt by Mr Poulden to serve the statement of claim by post on 30 June 2014. Again, there was no response from the defendant.

On or about 13 August 2014 the statement of claim was provided to the Principal Registrar of the Court to effect service on the defendant pursuant to r. 11A.4 of the Rules. The Principal Registrar of the Court wrote to Mr Poulden on 22 August 2014 and stated:

On 30 October 2014 the Principal Registrar wrote to Mr Poulden stating:

At some time between about 30 October 2014 and 29 May 2015 (it is not clear precisely when) the plaintiff’s solicitor apparently became aware that the defendant was working as a medical practitioner in the United Arab Emirates. On 29 May 2015 the plaintiff brought an ex-parte application in this Court seeking an order that the time for service of the statement of claim be extended to 30 September 2015. The affidavit of Mr Poulden of 28 May 2015 was read in support of that application. To the extent that it is relevant for present purposes, that affidavit stated the following:

On 12 June 2015, an order was made pursuant to r. 1.12 of the Rules that the time for service of the statement of claim be extended up to and including 30 September 2015. Notwithstanding the contents of para. 9 of Mr Poulden’s affidavit, there is no evidence of any personal service being effected on the defendant in Dubai. However on 24 September 2015 Vincent Severino, an investment banker who apparently resided in London, attended what I gather are the defendant’s consulting rooms at Harley Street, London. In his affidavit of 7 December 2015, Mr Severino stated (inter alia) the following:

Having regard to the way in which the submissions of the parties were developed at the hearing of the motion, the following questions arise for determination:

Senior counsel for the plaintiff submitted that having regard to the provisions of r. 12.11(2) the Rules, the motion had been filed substantially out of time and should be dismissed.

It was submitted that the period permitted under the Rules for the filing of the motion was 28 days after service of the statement of claim and that the motion had not been filed until almost 2 years after the statement of claim was served by Mr Poulden on the defendant by post on 12 May 2014. It was further submitted that even if the date of service was taken to be 24 September 2015 (that being the date on which Mr Severino attended the defendant’s consulting rooms in London and left a copy of the statement of claim with the receptionist) the motion had been filed after the lapse of more than six times the permitted period.

Senior counsel conceded that in the event that I concluded that the motion had been filed out of time, I retained a discretion to make an order extending the period. However he submitted that absent consent or clear evidence to support an extension of time after a lapse of such a long period, a rule such as this should be followed according to its terms: Keevers v O’Neill (1977) 30 FLR 300; [1977] 1 NSWLR 587 at 591 per Ash J.

It was submitted that in all of these circumstances, the motion should be dismissed.

Counsel for the defendant submitted that in a case where the very fact of service was in issue, it would make no sense for r. 12.11(2) to be read in the way for which the plaintiff contended. Moreover, counsel submitted that the opinions of Mr Dean established that neither the purported service of the statement of claim by post, nor its delivery by Mr Severino to the defendant’s surgery in 2015, constituted valid service. In these circumstances, it was submitted that time had not commenced to run.

Counsel for the defendant emphasised that neither Mr Dean’s expertise, nor his opinions, had been the subject of any objection or challenge. He submitted that the effect of those opinions was that service had not been properly effected according to English law, and that accordingly there was no time limit applicable to the filing of the defendant’s motion.

In considering this question there are a number of provisions of the Rules which are relevant.

Firstly, r. 1.13 is in the following terms:

Rule 6.9 is in the following terms:

Rule 6.10 is in the following terms:

Against that background r. 12.11 provides as follows:

Rule 10.20(2)(a) requires that originating process in proceedings in this Court be personally served. Rule 10.21 prescribes two modes of personal service:

Having regard to rr. 6.9 and 6.10, the time limit for a defendant to enter an appearance in proceedings is 28 days after service of the statement of claim, or such other time as the court directs for the filing of a defence. Accordingly, having regard to r. 12.11(2), a motion seeking an order of the kinds set out in r. 12.11(1) must be filed within that time. However, the phrase “28 days after service on the defendant of the statement of claim” as it is used in r. 6.10 must be taken to be a reference to valid service under the rules.

Pursuant to r. 11.2, an originating process may be served outside Australia in the circumstances referred to in Schedule 6 of the Rules. Paragraph (e) of that Schedule provides that one of those circumstances is where the proceedings are founded wholly or partly on damage suffered in NSW caused by a tortious act or omission wherever occurring. “Damage” for the purposes of that paragraph is not limited to immediate physical injury or loss suffered when the cause of action first accrued: Brix-Neilsen v Oceaneering Australia Pty Limited [1982] 2 NSWLR 173; Challenor v Douglas [1983] 2 NSWLR 405. In light of the contents of para. (19) of the plaintiff’s affidavit, I am satisfied that the present proceedings fall within para. (e) of Schedule 6. Accordingly, it was open to the plaintiff to attempt service of the statement of claim outside Australia.

Prima facie, personal service of a statement of claim is required by r. 10.20(2)(a). In the present case, neither the purported service by post which was undertaken by Mr Poulden, nor the purported service by Mr Severino in leaving a copy of the statement of claim with the defendant’s receptionist, constituted personal service under the Rules. As to the latter, the reference in r. 10.21 to “the person” must be taken as a reference to the person to be served, in this case the defendant. However, the requirement for personal service of the statement of claim in the present case is subject to r. 11.6 which states:

It is in light of the bolded passage of rule 11.6 that the opinions of Mr Dean become relevant. In the first of those opinions, and by reference to the affidavits of Mr Poulden of 28 May 2015, and Mr Severino of 7 December 2015, Mr Dean concluded (at para. 16) that there had not been valid service of the statement of claim on the defendant according to English law. In the second of his opinions, and by reference to the decision in Murrills v Berlanda and anor. [2014] EWCA Civ 6, Mr Dean confirmed (at para. 9) that postal service at the defendant’s business address in Harley Street, London was not effective under English law.

No objection was taken to the admission of Mr Dean’s opinions, and I accept them. They support the conclusion that neither the purported service by mail set out by Mr Poulden in his affidavits, nor the actions of Mr Severino in leaving a copy of the statement of claim at the defendant’s surgery, constitute valid service under English Law. Accordingly, the provisions of r. 11.6 have not been satisfied.

As I have previously noted, the reference to “service …. of the statement of claim” in r. 6.10(1)(a)(i) must be taken to be a reference to valid service. For the reasons I have given, the statement of claim has not been validly served, be it under the Rules or under English law.

The time limit prescribed by r. 12.11(2) is fixed by reference to that imposed by r. 6.10(1)(a)(i). As the time limit imposed by r. 6.10(1)(a) is fixed by reference to the date of valid service, and as valid service has not been effected, the motion has not been brought out of time. In these circumstances, it is not necessary for me to consider the question of an extension of time in which to file the motion.

Counsel for the defendant submitted that in the exercise of my discretion I should consider:

Counsel for the defendant submitted that consideration of these various matters supported the conclusion that an extension of time was not appropriate. In short, he submitted that all, or at least the vast majority of, the relevant factors weighed against such a conclusion. He pointed, in particular, to the fact that:

Senior counsel for the plaintiff effectively separated the period between 21 August 2013 (being the date of filing of the statement of claim) and 29 May 2015 (being the date of making the application for an extension order) into four separate periods as follows:

Senior counsel submitted that the evidence established that the delay in periods 2, 3 and 4 had been due to “difficulties with service”. He submitted that during those periods the plaintiff’s solicitor had been attempting, albeit without success, to serve the statement of claim. Senior counsel conceded that there was no explanation for the delay which had been occasioned within period 1.

Senior counsel for the plaintiff further submitted that the interests of justice compelled a determination in favour of the plaintiff on this question because (inter alia) the proceedings had been commenced within the limitation period. He further emphasised that there was no suggestion that the failure to attempt service of the statement of claim during period 1 was in any way attributable to the plaintiff herself, and that on the evidence, the fault for the delay was attributable to the plaintiff’s solicitor.

The discretion conferred by r. 1.12 is not fettered. However, a plaintiff who seeks an extension of time must establish a proper and adequate reason for such extension being granted: Pell v Hodges [2007] NSWCA 234 at [30] per Handley AJA (Tobias JA agreeing) and the authorities cited therein. The plaintiff bears the onus of establishing that an order should have been made at the relevant time: Weston v Publishing and Broadcasting Limited (2011) 83 ACSR 206; [2011] NSWSC 433 at [14] and [153] per Ward J (as her Honour then was).

In Kleinwort Benson Limited v Barbrak Limited [1987] AC 597 Lord Brandon identified the three categories of case in which an application for an order extending time in which to serve a statement of claim might be made. His Lordship said (at 615-616):

His Lordship went on to say (at 623):

In the present case, one of the factors relied upon by the defendant was that the proceedings had not been commenced by the plaintiff until shortly before the expiry of the limitation period. In Tolcher v Gordon (2005) 53 ACSR 442; [2005] NSWCA 135, Hodgson JA said (at [3]):

However Tobias JA (with whom Ipp JA agreed) took a different view (at [87]):

In Weston (supra) Ward J cited (at [176]) the judgment of Hodgson JA in Tolcher (supra). Having done so, her Honour noted (at [190]) that the statement of claim in that case was filed only a matter of days before the expiration of the limitation period. She went onto to observe (at [313]) the statements of Hodgson JA in Tolcher regarding the importance of a defendant being made aware of the fact that a claim was being made against him. However her Honour did not expressly follow the reasoning of Hodgson JA in Tolcher.

The majority in Tolcher were clearly of the view that delaying the institution of proceedings until a short time before the expiration of the limitation period could not be a relevant consideration on an application such as the present. To the extent that competing views have been expressed about this issue, I consider that I am bound by the decision of the majority in Tolcher. In any event, and putting that issue to one side, the remaining factors weigh heavily in favour of the order extending time for service being discharged.

The present case falls squarely within the third category identified by Lord Brandon. Accordingly, quite apart from any other consideration, the plaintiff is required to satisfactorily explain the failure to apply for an extension prior to 22 February 2014 when the statement of claim became stale. No such explanation appears anywhere in the evidence.

The application for an extension of time was not made until 29 May 2015, some 15 months after the statement of claim expired. Although there were, as set out in the evidence of Mr Poulden, some attempts to serve the statement of claim during that period, I am unable to accept the submission of senior counsel for the defendant that this lengthy period of delay is properly explained by there having been “difficulties with service”. In this regard, the division of the period between 21 August 2013 and 28 May 2015 (a period of 21 months) into separate and discrete periods is telling. For example, there is no evidence at all as to what (if any) steps were being undertaken to progress the matter between August 2013 and May 2014 when service was first attempted by post. That is a period of almost nine months. Similarly, there is an absence of evidence of what was taking place to progress the matter between October 2014 and May 2015. That is a period of some seven months. In the absence of any explanation, those periods of unexplained delay reflect an approach which is fundamentally at odds with the general tenor of the provisions of ss. 56-59 of the CPA. The plaintiff’s prosecution of these proceedings has, on any view of it, been less than diligent. It is fundamentally at odds with the facilitation of the just, quick, and cheap resolution of the issues which is contemplated by s. 56 of the CPA, and equally at odds with the emphasis, in s. 59 of the CPA, upon the necessity to minimise delay.

For all of these reasons, I am satisfied that the order extending the time for service of the statement of claim should be discharged.

Counsel for the defendant submitted that a series of factors which connected these proceedings to England were such as to render this Court a clearly inappropriate forum in which to determine the proceedings.

Firstly, counsel pointed to the fact that the plaintiff’s claim was based upon acts and omissions said to have taken place in England. He pointed out that in these circumstances the law to be applied by the trial judge was that of England, that being the place where the wrong was said to have been committed. Although counsel did not suggest that this was a determinative factor, he submitted that it was an important one in determining the degree of connection between the proceedings and England.

Secondly, counsel pointed to the fact that the majority of the evidence going to the issue of liability was to be found in England. In this regard, he pointed out that the defendant continued to practice, and reside, in London. He submitted that as a consequence, the defendant would be required to travel to Australia for any trial and that this would cause a significant disruption to his practice and considerable inconvenience to his patients. In light of the fact that there was a clear liability issue, counsel submitted that there was necessarily a strong likelihood that other professional and administrative staff associated with the defendant’s practice would be called in his case, all of whom were located in England. Counsel also pointed to the fact that because part of the plaintiff’s case against the defendant was pleaded in negligence, and because liability was in issue, the professional standards of plastic surgeons in England would necessarily be relevant in determining the question of breach of duty. It was submitted that there would accordingly be a necessity to call expert witnesses who resided in England.

Thirdly, and whilst recognising that the plaintiff had given some evidence of the potential difficulties for her if the proceedings were heard in England, counsel for the defendant submitted that this was of comparatively less significance. In particular, he submitted that although the plaintiff had asserted that she was unfamiliar with any legal practitioner(s) in England who might accept a retainer to act for her on a contingency basis, she had not given evidence of any steps that she had taken to investigate that issue. Counsel also pointed to a similar absence of such evidence in the affidavits of Mr Poulden.

Finally, in advancing the defendant’s position, counsel recognised that as a person who is ordinarily resident in NSW, the plaintiff had a legitimate juridical advantage of bringing her action in this Court. He also acknowledged the significant juridical disadvantage to the plaintiff if the proceedings were stayed (or dismissed), given that her claim in England was now statute barred, requiring her to seek an extension of time in order to proceed. However notwithstanding these matters, counsel submitted that the factors connecting the proceedings with England were significantly greater than those establishing a connection with NSW, rendering this Court a clearly inappropriate forum in which to deal with the matter.

Senior counsel for the plaintiff acknowledged the significance of the necessity to apply the law of England in determining whether the defendant’s case was made out. However, he pointed out that counsel for the defendant had acknowledged that a judge of this Court would be able to apply English law without difficulty.

Senior counsel for the plaintiff accepted that the relevant acts and omissions giving rise to the plaintiff’s causes of action occurred in London. However he took issue with the suggestion that the majority of the evidence would be called from persons resident in England. He pointed, in particular, to the plaintiff’s evidence that following the breakdown of her relationship with her partner in June 2011, she had returned to Australia and had remained here ever since. He also pointed to the plaintiff’s evidence that following her return to Australia she had received a vast amount of medical treatment from a large number of different medical practitioners, all of whom resided and practiced in NSW. He further submitted that whilst it may be that the professional standards of plastic surgeons in England were likely to be relevant in determining the question of breach, it remained the case that the plaintiff relied upon the evidence of medical practitioners in Australia.

Senior counsel also emphasised the fact that on the basis of the plaintiff’s evidence, she had limited financial means to travel to England, and that there was no evidence of any similar difficulties or constraints placed upon the defendant. To the extent that it was suggested that there would be disruption to the defendant, and to his patients, if he was required to travel to Australia, senior counsel pointed out that any hearing date in this Court would be listed with more than sufficient notice to allow the defendant to make appropriate arrangements in respect of his personal and professional affairs. It was submitted that even if the matter were to proceed in England, there would still be some level of disruption to the defendant’s practice.

Senior counsel for the plaintiff accepted that there were likely to be legal practitioners in England who would be willing to act in a matter such as this on a contingency basis. However, he relied on the fact that the plaintiff had engaged her present solicitor in this State more than three years ago, and that the defendant had also retained a solicitor in this State.

Finally, senior counsel submitted that if it was concluded that this Court was not the appropriate forum, the plaintiff’s causes of action would be statute barred in England, requiring her to obtain leave before the matter could proceed. Whilst acknowledging that this was not a decisive factor, it was submitted that it was nevertheless a significant consideration and one which weighed heavily in favour of the plaintiff’s position.

In Voth v Manildra Flour Mills Pty Limited (1990) 171 CLR 538; [1990] HCA 55 the plurality (Mason CJ, Deane, Dawson and Gaudron JJ) observed that the principles to be applied in an application for a stay on “inappropriate forum” grounds were those stated by Deane J in Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197; [1988] HCA 32. The relevant principles were summarised by the plurality (Dawson, Gaudron, McHugh and Gummow JJ) in Henry v Henry (1996) 185 CLR 571; [1996] HCA 51 at 587 as follows:

In McGregor v Potts and ors (2005) 68 NSWLR 109; [2005] NSWSC 1098 Brereton J, having set out part of the passage in Henry (supra) extracted above, said (at [43]):

His Honour went on to observe (at [51]):

Bearing in mind these principles, and having regard, in particular, to the fact that the relevant test contemplates that there will be a trial on all issues, the various “connecting factors” to which the parties referred in their respective submissions may be assessed as follows.

Firstly, the acts and omissions relevant to the determination of the issue of liability in respect of the allegation of negligence occurred, in their entirety, in England. It is evident from the affidavit of Mr Craney of 23 March 2016 that liability is very much in issue from the defendant’s point of view. In BHP Billiton Limited v Schultz (2004) 221 CLR 400; [2004] HCA 61 Callinan J (at [259]) emphasised the importance of this factor (citations omitted):

Secondly, and arising from the first matter, I am satisfied that the vast of the witnesses who are likely to give evidence going to the liability issue (including the defendant himself) are located in England. In particular, it is evident from Mr Craney’s affidavit of 23 March 2016 that in respect of the question of liability, the defendant is likely to adduce evidence from nursing, administrative and surgical staff from both the clinic at which the relevant pre-operative consultations and assessments were carried out, as well the hospital at which the surgical procedures were performed. Mr Craney’s affidavit identifies four such persons by name. There is also a reference to an undefined number of other potential witnesses drawn from both medical and administrative staff. Whilst the plaintiff has set out (in para. 17 of her affidavit) those medical and other practitioners whom she has consulted (all of whom are apparently resident in Australia) it appears that the vast majority of those witnesses would, if called, give evidence going to damages. Moreover, it is difficult, in light of the terms in which the statement of claim has been pleaded, to ascertain the relevance of evidence to be called from (for example) chiropractors whom the plaintiff has consulted.

Thirdly, the fact that the defendant resides in England means that there would necessarily be a disruption to his medical practice, and thus to the treatment of his patients, if he were required to travel to Australia for the purposes of the proceedings. The affidavit of Mr Craney of 23 March 2016 establishes that leaving aside the substantial cost involved, if the matter were to proceed in Australia the defendant would be required to be absent from London for a significant period, during which he would be unable to perform surgery and attend to pre and post-operative treatment of his patients. I accept Mr Craney’s evidence that the defendant’s patients are typically scheduled for surgery months in advance. Although the parties in a matter such as this would be given several months’ notice of the hearing date, the fact remains that there would necessarily be disruption to the defendant’s professional practice, as well as an associated cost (for which he would be responsible) associated with retaining a locum to act in his stead. There is no evidence that the plaintiff would be subjected to any similar dislocation, disruption or inconvenience if she were required to travel from Australia to England for a trial. It was suggested in submissions that the plaintiff was unable to meet the cost of travel to England. However, the evidence is that she is presently employed and earns in excess of AUD$100.000.00 per year. In this regard, the observations of Brereton J in McGregor (supra) are apt (at [77]):

Fourthly, the majority of the documentary evidence relevant to the issue of liability would appear to be located in England, in circumstances where the affidavit of Mr Craney of 11 May 2016 establishes that the defendant no longer has any relationship with the clinic through which the plaintiff first consulted him. It can be reasonably anticipated that one or other of the parties will seek production of (inter alia) the relevant patient file(s) and clinical notes. It may be that such evidence will also be relevant to the question of damages.

Fifthly, the parties agreed that the trial judge would be required to apply the law of England in the determination of the proceedings. In McGregor (supra) Brereton J observed (at [54], citations omitted):

Finally, as I have previously noted, it was submitted on behalf of the plaintiff that if the matter were not litigated in this Court, she would be prejudiced by the fact that her claim in England would be statute barred, thus requiring her to seek an extension of time in order to proceed. Obviously, there is no certainty that such an application, if made, would be successful. However even accepting that this is a relevant consideration, it is not decisive: McGregor at [79] citing BHP v Schultz (supra) at [258] per Callinan J. It is also relevant that on the evidence before me, there are legal practitioners in England who would be likely to be in a position to assist the plaintiff if the matter were litigated in that country, and who would be prepared to act for her on a contingency basis.

In my view, the various connecting factors identified in the present case are such as to lead to the conclusion that this Court is a clearly inappropriate forum in which to deal with the matter, and that the appropriate forum is England. Once again, the observations of Brereton J in McGregor (at [84]) are apt:

At [31]-[35] above I concluded (in the context of the first issue arising on the motion) that the statement of claim has not been properly served.

Given the conclusions I have reached, I make the following orders: