Austshade Pty Ltd v Boss Shade Pty Ltd (No 3)
[2016] FCA 663
•3 June 2016
FEDERAL COURT OF AUSTRALIA
Austshade Pty Ltd v Boss Shade Pty Ltd (No 3) [2016] FCA 663
File number: QUD 189 of 2012 Judge: DOWSETT J Date of judgment: 3 June 2016 Catchwords: PRACTICE AND PROCEDURE – amending pleadings – where applicants sought to amend a third further amended statement of claim after reasons for judgment published Legislation: Federal Court of Australia Act 1976 (Cth) Date of hearing: Determined on the papers Date of last submissions: 5 May 2016 Registry: Queensland Division: General Division National Practice Area: Intellectual Property Sub-area: Patents and associated Statutes Category: Catchwords Number of paragraphs: 9 Counsel for the Applicants: Mr A Musgrave Solicitor for the Applicants: Burns & Associates Solicitor for the Respondents: Mr M Byrne of Lillas & Loel Lawyers ORDERS
QUD 189 of 2012 BETWEEN: AUSTSHADE PTY LTD ACN 066 409 247
First Applicant
EKKEHARD SIEGFRIED HARTMUT KOEHN
Second Applicant
AND: BOSS SHADE PTY LTD ACN 115 280 272
First Respondent
BAUER INVESTMENTS PTY LTD ACN 010 865 068
Second Respondent
HOLGER BAUER (and others named in the Schedule)
Third Respondent
JUDGE:
DOWSETT J
DATE OF ORDER:
3 JUNE 2016
THE COURT ORDERS THAT:
1.leave be granted to the applicants to file and serve a further amended originating application and a fourth further amended statement of claim, such amendments being limited to the addition of a claim for recovery of a debt in the amount of $1,050 owed by the first respondent to the first applicant, pursuant to a deed between those parties executed on 30 November 2010;
2.such further amended originating application and fourth further amended statement of claim be filed and served within 7 days of the publication of these reasons;
3.in default of compliance with the order as to filing and service, the grant of leave to amend be revoked;
4.the first applicant have leave to enter judgment against the first respondent in the amount of $1,050, unless payment of such sum is tendered to the first applicant in cash or by bank cheque, within 14 days of the filing and serving of the said amended documents, or otherwise as agreed between the parties, and that such non‑payment may be proven by affidavit sworn on behalf of, and with the authorization of the first applicant;
5.the applicants pay the respondents’ costs of the proceedings;
6.the parties have liberty to apply concerning the payment or non‑payment of the said sum of $1,050; and
7.the action be otherwise dismissed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
DOWSETT J:
There has been a long history of litigation between the parties. In the present proceedings the applicants raised a complex range of issues for determination. In particular they alleged that one or more of the respondents had breached the terms of a licence agreement which authorized Boss Shade to exploit certain intellectual property held by the applicants. The applicants also alleged infringements of their intellectual property rights. The applicants have failed to demonstrate entitlement to any of the relief claimed. In particular, they have failed to demonstrate an entitlement to an account in connection with the sale of certain umbrellas. However, in the course of my reasons for judgment, I indicated that on the evidence as I have found it, Boss Shade had failed to pay to Austshade, royalties on the sale of seven umbrellas, a total sum of $1,050. The royalties were payable pursuant to a deed (the “Deed”) entered into between the applicants on the one hand and the respondents (Boss Shade and Mr Bauer) on the other. The Deed was entered into in order to give effect to a compromise of previous proceedings. In these proceedings the applicants did not claim the royalties, although they had sought the account of profits to which I have referred. In my reasons, I invited the parties to make further submissions concerning the royalties.
The applicants now seek to amend their third further amended statement of claim to add, at para 7(i), an allegation that Boss Shade failed to pay to Austshade the amount of $1,050. However it has not sought to add a claim for that amount. Presumably, they intend to do so. The applicants have not explained their failure to make such claim at any earlier stage in these proceedings. The respondents oppose the application to amend and submit that the applicants cannot add such a claim unless they also amend their originating application. They also submit that no demand for payment of outstanding royalties has ever been made. The respondents make other submissions concerning the application to amend, but do not suggest that had the issue been raised at the trial, they would have addressed it, or that they are now unable to do so. In other words, they do not submit that they would have had any defence to the claim. The parties seem to assume that the relevant cause of action is for damages for breach of contract. In my view, it is a claim for a debt owing under the Deed.
Section 22 of the Federal Court of Australia Act 1976 (Cth) (the “Federal Court Act”) provides:
The Court shall, in every matter before the Court, grant, either absolutely or on such terms and conditions as the Court thinks just, all remedies to which any of the parties appears to be entitled in respect of a legal or equitable claim properly brought forward by him or her in the matter, so that, as far as possible, all matters in controversy between the parties may be completely and finally determined and all multiplicity of proceedings concerning any of those matters avoided.
There is seldom any need to rely on that section. Any attempt to do so is usually by way of last resort for a party who is otherwise without any entitlement to relief. However s 22 is of peculiar relevance for present purposes. The parties, or some of them, have been in litigation for years. The applicants’ approach to this case may have been somewhat unrealistic and perhaps, too ambitious. In some ways, it may also have been misconceived. Perhaps such misconception caused them to overlook, or deliberately ignore any claim in debt. Nonetheless, on my findings of fact, and absent any claim to prejudice to the respondents, it would be unjust to deny Austshade its legal entitlement, established largely upon my view of the evidence, including the respondents’ own evidence. Further, to refuse to allow the claim to be raised in these proceedings might well lead to further litigation. Section 22 requires and authorizes me to act accordingly. It is true that the applicants have not “properly brought forward” such a claim, but that problem can be easily rectified. I see no bar to allowing an amendment at any time prior to the perfection of final orders in the matter, provided that there is no unfairness to the respondents.
As to the question of demand, the respondents overlook the fact that cl 5.2(d) of the Deed provided that royalties be paid on the last day of each calendar month, for all sales made during that month. The evidence also shows that at least one demand for payment of royalties was made on 3 August 2011. It is impossible to say whether it related to the seven umbrellas upon which royalties have not been paid. It may be that, in view of the protracted dealings between the parties, it became necessary that there be a further demand, but demand has now been made by virtue of the application to amend.
I grant leave to amend the originating application and the third further amended statement of claim by adding a claim for a debt of $1,050, owed by Boss Shade to Austshade. Such amended documents are to be filed and served within seven days. In default of compliance with that order, leave to amend will be revoked. I do not presently propose to enter judgment against Boss Shade. It should have an opportunity to tender payment so as to avoid the entry of judgment. Alternatively, as I propose to order costs against the applicants, and in favour of the respondents, the parties might agree that the amount of $1,050 should be set off against the amount found to be due by way of costs.
As to costs, I have read the parties’ submissions. I see no reason to deprive the respondents of the costs of the proceedings. The applicants have been wholly unsuccessful, save as to the amount of $1,050, an issue which was not ventilated at trial. If that issue has contributed, in any significant degree, to the costs of the proceedings, the applicants should bear such costs, along with the costs of the proceedings as a whole.
I:
·grant leave to the applicants to file and serve a further amended originating application and a fourth further amended statement of claim, such amendments being limited to the addition of a claim for recovery of a debt in the amount of $1,050 owed by the first respondent to the first applicant pursuant to a deed between those parties executed on 30 November 2010;
·order that such further amended originating application and fourth further amended statement of claim be filed and served within 7 days of the publication of these reasons;
·order that in default of compliance with the order as to filing and service, the grant of leave to amend be revoked;
·order that the first applicant have leave to enter judgment against the first respondent in the amount of $1,050, unless payment of such sum is tendered to the first applicant in cash or by bank cheque, within 14 days of the filing and serving of the said amended documents, or otherwise as agreed between the parties, and that the first applicant may prove such non‑payment by affidavit sworn on behalf of, and with the authorization of the first applicant;
·order that the applicants pay the respondents’ costs of the proceedings;
·order that the parties have liberty to apply concerning the payment or non‑payment of the said sum of $1,050; and
·order that the action be otherwise dismissed.
I should add that in the course of preparing these reasons, I detected typographical errors at [51] and [54] and have issued a table of corrections.
I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett. Associate:
Dated: 3 June 2016
SCHEDULE OF PARTIES
QUD 189 of 2012 Respondents
Fourth Respondent:
BERNHEL PTY LTD ACN 065 563 920 TRADING AS ROLL‑A‑SHADE
Fifth Respondent:
STEFAN BAUER
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