Case: Menzies v CRCI Pty Ltd [2007] NSWCA 118
Outcome: cited
A key issue is the extent to which the adjournment of the trial prejudices the respondent in such a way that the respondent cannot be compensated by an award of costs. Clearly the respondent will suffer prejudice from the prolongation of the litigation, which is a relevant consideration particularly where the application to vacate the trial dates takes place shortly before the trial commences (cf Menzies v CRCI Pty Ltd [2007] NSWCA 118). In relation to more substantial prejudice, Mr Looney drew my attention to affidavits of Mr Paul Jeynes, director of the respondent, sworn 19 November 2007 and 4 June 2008, where Mr Jeynes deposed, inter alia : &#8226; He had received telephone calls in February 2008 from two customers of the respondent informing him that they had been told by the applicant that the respondent's product is ineffective, and that the applicant had brought an action against the respondent, however Mr Jeynes was able to convince the customers that there was no substance to the applicant's allegations. &#8226; He was concerned that the respondent would not always know when the applicant approached the respondent's customers and made such allegations. &#8226; He was aware that the respondent had lost at least one customer since the proceedings had commenced. &#8226; He was concerned as to the possible adverse effect of these proceedings on the respondent's business, and that any adjournment of the trial would increase the risk that the respondent would lose customers. &#8226; The applicant operated on a national basis whereas the respondent operated mainly within south-east Queensland. 34 I note the concerns of the respondent and its officers which are very real, and I do not understate their anxiety. I also note that the parties to these proceedings are clearly in competition for business in south-east Queensland, and that Mr Peden submitted that the applicant was aware that one of its staff may have contacted customers of the respondent as Mr Jeynes deposed. However in relation to these points: &#8226; Notwithstanding the fact that Mr Jeynes had had the relevant telephone conversations with customers, his evidence was that he was able to convince them of the lack of merit in the applicant's claims, with the result that no damage arising from the contact by the applicant could be demonstrated. &#8226; There was no evidence that any customer had been lost to the respondent because of the claims of the applicant (as distinct from since the proceedings had commenced). &#8226; The applicant is prepared to give an undertaking in relation to informing third parties of these proceedings. &#8226; While for any litigant prolongation of litigation is undesirable, in this case the litigation has only been on foot since the end of 2007. &#8226; The application to vacate the trial dates has been made several weeks ahead of the scheduled commencement date of the trial; and &#8226; Perhaps regrettably, litigation is not uncommon in industries characterised by strong competition as this industry appears to be, and applications to clarify pleadings in litigation are also not uncommon. 35 The respondent has not demonstrated any prejudice from vacation of the trial dates for which it would not be adequately compensated by costs and an acceptable undertaking from the applicant.