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SUCCESSFUL LITIGATION TACTICS WHICH TURN THE CASE AROUND

Blog & Articles, Civil Litigation, Tang Law

It is normal for a civil proceedings to take 18 to 24 months to reach and complete a full trial.

In many cases, it could take even longer, up to 7 years. Legal proceedings is very costly and could cost hundreds of thousands of dollars. It is also highly risk, if you lose, you are very likely to also have to pay for the other party’s costs.

A decision on whether to litigate a matter must be made with extreme care.

Why Does It Take So Long?

The Australia legal system is very mature and the Court procedures are highly complex. There are many steps that must be taken in the normal course of proceedings before a case is ready for trial. This can easily take 12 to 18 months.

In addition to these steps in the normal course of proceedings, there are many other procedures in the process for interim applications to be made. These interim applications, if made, will delay the proceedings even more.

What is Litigation Tactic?

Litigation tactics are deployed to achieve your specific objectives, for example, to improve your position in order to facilitate a better outcome at negotiation, to improve your chance of success, to give you more clarity in a complicated situation, to secure or freeze assets of the other parties, etc.

However, do remember, every step you take or every application you make in the proceedings will cost you money, and it may also have cost implications if you were unsuccessful. Extreme caution must be used in deciding what tactic to use. To do this, you need highly skilled and experienced litigation lawyer to assist you.

Even though it is costly to make interim applications, in some situations, it can help you achieve an immediate “win”. One good example is a recent case we handled.

Case Study

Our client was sued by a business partner for misleading or deceptive conduct and breach of contract. It is my view that the claim was groundless or, at best, a very weak one. The partner was claiming around half a million as compensation. Our client was originally using another law firm and the claim in Court against our client proceeded for several months. Unfortunately for our client, the case was not properly conducted and the judge kept ordering costs against our client. They have also attempted to negotiate a settlement but have also failed.

Our client was stressed and felt helpless, and they came to see me for second opinion. In the first consultation with me, having briefly analysed the case, I told the client they are faced with several problems:

  1. Firstly, litigation is inherently costly and risky. For their case, I estimated over $100,000 in legal fees if the matter proceeds to a full trial. My question for them is even if they can afford it, do they want to incur this kind of expense?
  2. Secondly, they were stuck because they were being sued. They do not have a choice but to defend against the half a million dollar claim.
  3. Thirdly, they were not on the good side of the judge for continuously failed to comply with the court orders and procedures. This is undesirable.

The client was stuck in a very bad situation, having to try and save the business on the one hand, and having to deal with the legal case on the other hand. She had no control of the case and the judge was losing patience with her.

To save her situation, my advice and strategy was very clear:

  1. First, we must turn her position around from being reactive to pro-active. We must take control of the proceedings and take control of the overall situation. We want to dictate the rhythm of the matter. Can we do this? Of course we can, and we did, through the litigation tactics (see below).
  2. Secondly, we want to improve the client’s position, from being sued and having no bargaining power, to counterclaiming against the plaintiff and give her better bargaining position.

To achieve these, we made two interim applications to the Court:

  1. We applied and moved the matter into a Case Management List. As a result, we were able to move the case to another judge. Strategically, this was advantageous to the client.
  2. We then made an application to the Court for security for cost against the Plaintiff, as the business partner was a foreign person with no assets in Australia. Our application was opposed by the plaintiff’s lawyer. We were successful and the Court ordered that the plaintiff pays costs into the Court before the proceedings is allowed to continue. (see diagram – Court Order). Subsequently, the plaintiff failed to comply and as a result, the case has now been moved into an inactive list. (see diagram 2 – Court Order 2) This is an excellent example of how litigation tactics can help a party completely turn a case around. The client now does not need to spend over $100,000 in legal fees, and moreover, the plaintiff has disappeared and claim against our client is gone. This became an immediate “win” for the client.

ABOUT THE WRITER

Kelvin Tang has over 14 years’ experience practising law in Western Australia. He is the founder and Principal Partner of Tang Law based in Perth, Western Australia. Kelvin is a Registered Migration Agent (MARN: 1386452) and has extensive experience in providing migration advice to clients, advising on “Eligible Businesses” within the definition of the Migration Regulations, assisting migrants (investor of the business) with satisfying migration requirements, making visa applications and appealing cancelled or refused visas in the Federal Court of Australia, Administrative Appeals Tribunal and Migration Review Tribunal. Kelvin also has extensive experience in civil litigation, commercial and corporate law matters.

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Case Study: How Our Lawyers Handle Commercial Disputes At Your Best Interest?

Anfernee Lai Perth, Blog & Articles, Civil Litigation, Commercial Disputes; Business Disputes Perth, Litigation, Partnership Disputes, Shareholder Disputes, Tang Law, Tang Legal

These cases studies are based on real life situations, client names and images may have been changed to protect privacy. Each case study generally represents the experiences clients will have, however, each client has their own subjective goals and requirements to suit those specific goals and requirements. Thus, these case studies may not be deemed to create any warranty or representation that any other clients’ experience will be the same as the experience identified herein.

Genuine Story

Mr Chan was a successful entrepreneur in China who entered into joint venture agreements with Mr Smith with respect to property developments in Western Australia.

After the first project, Mr Smith invited Mr Chan to roll over his capital and profits, in excess of $1 million, from the first project into a second property development project.
After the second project, from which multi-millions of profits were made, Mr Smith again invited Mr Chan to roll over all his monies in the project into a third property development project. Mr Chan disagreed and requested to have his capital and profits from the projects returned to him.

Mr Smith refused. To the surprise of Mr Chan, Mr Smith secretly removed Mr Chan as a director of the company as well as issued more shares to himself.

 

Mr Chan engaged our firm to assist him to recover his capital and the agreed profits. Over the years, Mr Chen has invested approximately $1.2 million into the projects.

Solution

We were instructed by Mr Chan to commence proceedings in the Supreme Court against Mr Smith to recover his capital and the agreed profits.
Simultaneously, we assisted Mr Chan to successfully obtain a Freezing Order against Mr Smith which prevented Mr Smith from disbursing his personal assets as well as assets (including substantial amount of cash) held by the company.
Mr Chan and Mr Smith were unable to reach an out of court settlement and the dispute had to be determined by the Supreme Court after a 10 days trial.

Outcome

Mr Chan was successful in obtaining judgments from the Supreme Court in his favour for a sum in excess of $3.1 million plus recovering $300,000 in legal costs.

About the Writer

Kelvin Tang

Kelvin has over 14 years’ experience practising law in Western Australia. He is the founder and Principal Partner of Tang Law based in Perth, Western Australia. Kelvin is a Registered Migration Agent (MARN: 1386452) and has extensive experience in providing service on Commercial Law, Dispute Resolution & Litigation, Family Law, Wills & Estate Planning and Settlements.
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What Can I Do If I Have a Dispute With Builders?

Blog & Articles, Building Disputes WA, Civil Litigation, Defamation and dispute, Litigation, Tang Legal, Western Australia Builders

BUILDING DISPUTES IN WESTERN AUSTRALIA

Since 2011 the adjudication of complaints relating to home building contracts and ‘regulated building services’ has been simplified for consumers and service providers. The Building Commission, and the State Administrative Tribunal in certain cases, has jurisdiction to hear complaints arising under the Home Building Contracts Act 1991 (“HBCA”) and the Building (Complaint Resolution and Administration) Act 2011 (“BCRA”).Builders also have recourse to the rapid adjudication processes provided by the Construction Contracts Act 2004in relation to payment disputes.


Home Building Contract disputes

 

Contracts for building work between $7,500 and $500,000 are classified as a ‘home building contract’ by the HBCA. The HBCA regulates home building contracts, including by prescribing terms to be included in the contract and requiring notices, home indemnity insurance and other procedures to be carried out or obtained prior to entry into a contract. Certain terms are also prohibited from inclusion in a home building contract.
As the HBCA relates specifically to matters relating to the contract, complaints arising under this act are primarily contractual in nature.   
Many building service providers incorrectly assume the HBCA only applies to builders undertaking substantial work on a home, such as the construction or renovation of a new home. In fact the HBCA extends to owner-builders and all associated building work, such as landscaping and cabinetry.
The HBCA contains civil penalty provisions for certain breaches of the act by a builder, for example requiring payment of a deposit that exceeds 6.5% of the contract price or undertaking home building work without obtaining the requisite insurance. This can result in the Building Commission commencing a prosecution and significant infringements subsequently being imposed on a builder. It is therefore essential that all providers of home building work, including associated work where the provider directly contracts with the owner, carefully review the provisions of the HBCA and ensure their written contracts comply with the HBCA before they are entered into.
The Building Commission has jurisdiction to hear complaints commenced within 3 years from the date the dispute arose. Remedies for an owner and a builder in relation to non-fulfilment of conditions imposed by the HBCA are set out in Schedule 1 of the Act, and include termination of the contract by the party not in breach.
The Commissioner has a number of remedial orders which can be made under the BCRA in respect of home building contracts, including orders restraining or requiring certain action by the builder, an order that a party pay an amount due under the contract or declaring that an amount is not payable, and an order requiring a party to pay specific compensation arising from a breach of the contract or the HBCA. Orders declaring a provision or a contract void can also be made in respect of specific breaches of the HBCA.
 

Workmanship disputes

A person adversely affected by the carrying out of a ‘regulated building service’ can make a complaint to the Building Commission on the basis that the building work was not carried out in a proper and proficient manner, or was faulty or unsatisfactory. Complaints made under the BCRA are therefore known as ‘workmanship complaints’.
The class of persons ‘adversely affected’ by a regulated building service extends beyond the owner who contracted with the builder, to a subsequent owner of the property or a neighbour for example. The complaint must however be made within 6 years from the date of practical completion where work was not carried out under a permit, or within 6 years from a notice of cessation or a notice of completion where work was carried out under a permit.
The term ‘regulated building service’ is defined in the BCRA as a building service carried out by a registered builder or approved owner-builder, and home building work under the HBCA. ‘Building service’ includes building work, demolition work (within the meaning of those terms in the Building Act 2011*), plumbing work and other prescribed works.
An aggrieved party must give 14 days’ notice to the other party before commencing a complaint, designed to encourage the parties to reach an informal resolution of the dispute with the need to resort to the formal complaint process.
Once the complaint is commenced, the Commissioner has the power to dismiss the claim, or require further details of the claim to be provided in deciding whether to accept or dismiss the claim. Once the claim is accepted, the Commissioner must cause an investigation to be carried out by an inspector, who subsequently produces a report. The report may include recommendations as to how the complaint should be dealt with. After receiving the report, the Commissioner may commence a conciliation process at which both parties must attend generally without their legal representatives present.
Building remedy orders may be made by the Commissioner or SAT if satisfied that the work was not carried out in a proper and proficient manner or was faulty or unsatisfactory. If the compensation or value of the work orders being sought by the aggrieved party exceeds $100,000, the Commissioner must refer the matter to the State Administrative Tribunal, which has jurisdiction up to $500,000.
The Commissioner or SAT can also award compensation in lieu of a building remedy order if it is just and expedient to do so, for example where a builder has shown itself to be incapable of performing any building work to the standard expected of a professional builder, or where the builder has refused to carry out the work.


Claims outside the BCRA

 

For latent defects that are not identified by a consumer within the 6 year limitation period provided in the BCRA, it may be necessary for the consumer to resort to remedies under the building contract, if still available, or a negligence claim against the builder. Such claims would need to be commenced in a Western Australian court,  depending on the value of the claim.
For causes of action based upon a builder’s professional negligence, a consumer will typically have a limitation period of 6 years from the date the damage caused by a latent defect was discovered by the consumer, or was capable of being discovered by the reasonable diligence of the consumer.
 
* The Building Act 2011 defines ‘building work’ as: (a) the construction, erection, assembly or placement of a building or an incidental structure; or (b) the renovation, alteration, extension, improvement or repair of a building or an incidental structure; or (c) the assembly, reassembly or securing of a relocated building or a relocated incidental structure; or (d) the changing of ground levels of land for the purposes of work of a kind mentioned in paragraph (a), (b) or (c) to an extent that could adversely affect land beyond its boundaries; or (e) site work on any land for the purposes of, or required because of, work of a kind mentioned in — (i) paragraph (a), (b), (c) or (d); or (ii) paragraph (a) or (b) of the definition of demolition work; or (f) other prescribed work,
‘demolition work’ is defined as (a) the demolition, dismantling or removal of a building or an incidental structure; or (b) the changing of ground levels for the purposes of work of a kind mentioned in paragraph (a) to an extent that could adversely affect land owned by a person other than an owner of the land on which the building or incidental structure that is the subject of the demolition work is located; or (c) other prescribed work, but does not include work of a kind prescribed for the purposes of this definition as not being demolition work;
‘incidental structure’ means a structure attached to or incidental to a building and includes — (a) a chimney, mast, swimming pool, fence, free-standing wall, retaining wall or permanent protection structure; and (b) a part of a structure.