A1 for Maintenance Pty Ltd v Lehal Pty Ltd - [2017] FCA 1505

FEDERAL COURT OF AUSTRALIA
A1 For Maintenance Pty Ltd v Lehal Pty Ltd [2017] FCA 1505

File number: WAD 162 of 2017

Judge: GILMOUR J

Date of judgment: 22 December 2017

Catchwords: PRACTICE AND PROCEDURE – interlocutory application – self-executing or ‘springing’ orders – application for extension of time to comply with a self-executing order to file a List of Documents for discovery – held: application dismissed

Legislation:
Federal Court Act 1976 (Cth) ss 37M and 43

Federal Court Rules 2011 (Cth) pt 40

Cases cited:
FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268

LFDB v SM [2017] FCAFC 178

Date of hearing: 13 November 2017

Registry: Western Australia

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: Commercial Contracts, Banking, Finance and Insurance

Category: Catchwords

Number of paragraphs: 38

Counsel for the Applicant: Mr M Pirrie

Solicitor for the Applicant: Frenkel Partners

Solicitor for the First to Seventh Respondent: Mr A Prime of MDS Legal

Counsel for the Eighth Respondent: The Eighth Respondent appeared in person

ORDERS

WAD 162 of 2017

BETWEEN:
A1 FOR MAINTENANCE PTY LTD

Applicant

AND:
LEHAL PTY LTD ACN 113 002 109

First Respondent

RAVI INDER SINGH
Second Respondent

MAJINDER SINGH (and others named in the Schedule)
Third Respondent

JUDGE:

GILMOUR J

DATE OF ORDER:

22 DECEMBER 2017

THE COURT ORDERS THAT:
1.The Eighth Respondent’s interlocutory application filed on 31 October 2017 for an extension of time to comply with the orders of the Court dated 13 September 2017 be dismissed.
2.The Eighth Respondent’s defence be struck out and judgment be entered for the Applicant against the Eighth Respondent for damages to be assessed.
3.Costs be reserved.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT
GILMOUR J:

The Eighth Respondent, Mr Gurdit Singh, applies to extend the time for compliance with the order of the Court made on 13 September 2017 that he make, file and serve his list of documents by 4pm on 6 October 2017, failing which his defence be struck out and judgment be entered for the applicant, A1 for Maintenance Pty Ltd (A1), against him for damages to be assessed.
The application, which is opposed by A1, is supported by Mr Singh’s two affidavits sworn on 30 October and 12 November 2017 respectively.
Background
The proceedings were commenced by A1 on 4 April 2017. In its originating application, the applicant claims that the respondents are bound by and have contravened three franchise agreements for car wash businesses. The applicant seeks various declarations, injunctions and damages as relief.
Mr Singh is alleged by the applicant to have been directly or indirectly, knowingly concerned in, or party to the various unconscionable conduct and franchisee agreement breaches alleged against.
Mr Singh is the registered holder of the business name “Impeccable Hand Car Wash”, which name is the subject of certain of the applicant’s allegations of misconduct by the respondents.
A general order for discovery was…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] FCA 1505
Decision Date: 22 December 2017

CaseChat Overview and Summary

A1 for Maintenance Pty Ltd filed a proceeding against Lehal Pty Ltd, and other respondents, alleging contraventions of franchise agreements and seeking various declarations, injunctions, and damages. Mr Singh, the eighth respondent, failed to comply with a self-executing order to file a List of Documents for discovery by 6 October 2017, which led to an interlocutory application for an extension of time to comply with the order. The applicant opposed the application.

The primary legal issue was whether Mr Singh’s application for an extension of time to comply with the self-executing order should be granted. The court considered the principle that self-executing orders are meant to be enforced without further court intervention and Mr Singh's reasons for non-compliance, including his reference to an expired Microsoft Word license and lack of access to alternative computer facilities. The court also assessed whether Mr Singh's non-compliance was justified and whether the application was made promptly.

The court held that self-executing orders are to be enforced automatically, and any failure to comply should be addressed by the affected party without delay. Mr Singh's reasons for non-compliance were found to be inadequate, as they were not supported by sufficient evidence. The court noted that Mr Singh had access to alternative computer facilities and did not provide a satisfactory explanation for his failure to comply with the order. The application was made after the deadline for compliance had passed, and the court found that Mr Singh did not demonstrate any exceptional circumstances warranting an extension of time. Consequently, the application for an extension of time was dismissed, Mr Singh’s defence was struck out, and judgment was entered for the applicant for damages to be assessed. Costs were reserved.

Orders

Orders of the court

1. The Eighth Respondent’s interlocutory application filed on 31 October 2017 for an extension of time to comply with the orders of the Court dated 13 September 2017 be dismissed.

2. The Eighth Respondent’s defence be struck out and judgment be entered for the Applicant against the Eighth Respondent for damages to be assessed.

3. Costs be reserved.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The application, which is opposed by A1, is supported by Mr Singh’s two affidavits sworn on 30 October and 12 November 2017 respectively.Background The proceedings were commenced by A1 on 4 April 2017. In its originating application, the applicant claims that the respondents are bound by and have contravened three franchise agreements for car wash businesses. The applicant seeks various declarations, injunctions and damages as relief. Mr Singh is alleged by the applicant to have been directly or indirectly, knowingly concerned in, or party to the various unconscionable conduct and franchisee agreement breaches alleged against. Mr Singh is the registered holder of the business name “Impeccable Hand Car Wash”, which name is the subject of certain of the applicant’s allegations of misconduct by the respondents. A general order for discovery was made by consent in respect of all the parties, including Mr Singh, on 24 May 2017 for compliance by 21 June 2017. Mr Singh did not comply with this order. At a directions hearing on 13 September 2017 I made the following orders relevant to the issue of discovery:1.The Applicant and the First to Seventh Respondents by their solicitors confer in relation to the question of compliance with the order for discovery made by the Court in relation to those respondents on 24 May 2017 with a view to resolving that question.2.The Eighth Respondent make, file and serve his List of Documents by 4pm on 6 October 2017, failing which his Defence be struck out and judgment be entered for the Applicant against the Eighth Respondent for damages to be assessed, and the Eighth Respondent pay the Applicant’s costs of the proceedings pursuant to Section 43 of the Federal Court of Australia Act 1976 (Cth) and Part 40 of the Federal Court Rules 2011 (Cth). Mr Singh did not comply with order 3 (Self-Executing Order). On 11 October 2017, the applicant’s solicitors wrote to my Chambers to bring Mr Singh’s non-compliance to my attention and offered to provide a draft order that judgment be entered in the terms of the self-executing order. The following day, Mr Singh filed the List of Documents with the Court, which my Associate brought to the parties attention by email dated 13 October 2017. Nonetheless, on that same day, I requested a draft order from the applicant’s solicitors, which request my Associate conveyed to parties by email, and which draft order I received that afternoon. Mr Singh, also on 13 October 2017, replied to the email enclosing the draft order from the applicant’s solicitor, making several requests of the Court (concerning particulars of his alleged involvement and delaying judgment against him until the First and Seventh Respondents’ liability was determined) and making reference to an alleged expired licence to use Microsoft Word. Having considered this email, I asked my Associate to inform Mr Singh, by email dated 23 October 2017 of the following:Order 3 of the orders made of 13 September 2017 will be enforced, with your defence struck out and judgment entered against you, unless you file and serve an application to extend time for compliance with the 13 September 2017 orders. The application should be supported with an affidavit in which you explain in detail the reasons for your failure to comply, including relevant documents such as those concerning your Microsoft Word subscription coming to an end, and whether you had access to alternative computer facilities.Both the application and affidavit must be filed by 5:00pm on 30 October 2017.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

File number:	WAD 162 of 2017
Judge:	GILMOUR J
Date of judgment:	22 December 2017
Catchwords:	PRACTICE AND PROCEDURE – interlocutory application – self-executing or ‘springing’ orders – application for extension of time to comply with a self-executing order to file a List of Documents for discovery – held: application dismissed
Legislation:	Federal Court Act 1976 (Cth) ss 37M and 43 Federal Court Rules 2011 (Cth) pt 40
Cases cited:	FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268 LFDB v SM [2017] FCAFC 178
Date of hearing:	13 November 2017
Registry:	Western Australia
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Commercial Contracts, Banking, Finance and Insurance
Category:	Catchwords
Number of paragraphs:	38
Counsel for the Applicant:	Mr M Pirrie
Solicitor for the Applicant:	Frenkel Partners
Solicitor for the First to Seventh Respondent:	Mr A Prime of MDS Legal
Counsel for the Eighth Respondent:	The Eighth Respondent appeared in person

JUDGE:	GILMOUR J
DATE OF ORDER:	22 DECEMBER 2017