Dovuro Pty Ltd v Wilkins & Ors

[2003] HCATrans 591

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S357 of 2002

B e t w e e n -

DOVURO PTY LIMITED

Appellant

and

ROBERT JOHN WILKINS, EILEEN JOYCE WILKINS, TREVOR IAN WILKINS, SUSAN CAROLINE WILKINS and LOCHIEL NOMINEES PTY LIMITED as trustee for THE R & E WILKINS FAMILY TRUST all trading as R & E WILKINS

First Respondent

CROP MARKETING NEW ZEALAND SOCIETY LIMITED

Second Respondent

Summonses

McHUGH J

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON MONDAY, 24 FEBRUARY 2003, AT 9.59 AM

(Continued from 18/2/03)

Copyright in the High Court of Australia

HIS HONOUR:   Call the security for costs matter.

MR J.E. ROWE:   May it please your Honour, I appear for Wilkins.  (instructed by Long Howland Houston) 

MR B.W. RAYMENT, QC:   May it please your Honour, I appear for the respondent to that application, the appellant in the appeal.  (instructed by Griffith Hack Lawyers) 

HIS HONOUR:   Now, what is the position in relation to that matter, Mr Rayment?

MR RAYMENT:   Your Honour, we would not seek to oppose the order and we apprehend that it will be satisfied within the course of this week by a bank guarantee being proffered to the Registrar.

HIS HONOUR:   What do you say about the sum claimed?

MR RAYMENT:   Nothing, your Honour, and costs, we would respectfully submit, should be costs in the appeal.

HIS HONOUR:   Yes.  Mr Rowe, what do you say about these ‑ ‑ ‑

MR ROWE:   We are seeking costs of this application, your Honour.

HIS HONOUR:   Why do you say that?

MR ROWE:   Your Honour, the application had to be brought and the circumstances were beyond our control.

HIS HONOUR:   Yes, I think that is right.  What can you say to that, Mr Rayment?

MR RAYMENT:   Your Honour, if security were being applied for in the usual way, costs would be costs in the appeal, in our respectful submission.

HIS HONOUR:   But why?  Why should the respondent have to pay the costs if they lose the appeal?  It is your insolvency that has brought this about.

MR RAYMENT:   But that is not a matter of misconduct, in our respectful submission.

HIS HONOUR:   It is not a question of misconduct, but it seems to me that the application has been brought about through no fault of the respondent and simply because your company has gone into liquidation.

MR RAYMENT:   Yes, if your Honour pleases.

HIS HONOUR:   Yes, thank you.

In this summons brought by Robert John Wilkins and others seeking security for costs, I make the following orders:

1.        The appellant provide security for costs of the proceedings in the sum of $45,600;

2.        That the further conduct of the proceedings other than the application by QBE, which I will hear in a moment, be stayed until such security has been provided;

3.        The appellant pay the costs of this summons.

Anything else, Mr Rowe?

MR ROWE:   Your Honour, the only other matter is the question of the appeal books.  There have been no appeal books as yet and preparation of the case from our point of view – I will have a leader and at this stage it is on in March and we ‑ ‑ ‑

HIS HONOUR:   I know.

MR RAYMENT:   I am informed that the appeal books can be filed tomorrow, your Honour.

HIS HONOUR:   They will be filed tomorrow? 

MR RAYMENT:   Yes.

HIS HONOUR:   Well, I will make a further order that the appeal books be filed and other necessary steps be taken by 4.00 pm on Wednesday of this week and I give the parties liberty to apply if that order is not fulfilled.

MR RAYMENT:   Your Honour, in obedience to requests made to me informally by the Registrar, I invite your Honour to certify for counsel.

HIS HONOUR:   Yes.  I certify for counsel. 

Call the next matter, the summons by QBE.

MR M. DEMPSEY:   If your Honour pleases, I appear for QBE.  (instructed by Wotton & Kearney)

MR B.W. RAYMENT, QC:   May it please your Honour, I appear for Dovuro Pty Limited.  (instructed by Griffith Hack Lawyers) 

HIS HONOUR:   What is your attitude to this, Mr Rayment?

MR RAYMENT:   This application is opposed.

HIS HONOUR:   Yes, Mr Dempsey.

MR DEMPSEY:   If your Honour pleases.  Has your Honour received and had an opportunity to look at the written submissions?

HIS HONOUR:   I have looked at the written submissions on both sides and I have to tell both parties that I think they are far from helpful submissions but, be that as it may, I have read them.

MR DEMPSEY:   If your Honour pleases.  Your Honour, the basis of the application is that if the appeal is successful Dovuro will have the benefit of an order that its costs of defending the claim be paid by QBE as a result of the proceedings below.

HIS HONOUR:   I gather that on 19 March the Federal Court ordered that QBE be joined as third respondent to the appeal.

MR DEMPSEY:   No, your Honour.  They had the effect of joining QBE as a third respondent to the proceedings.

HIS HONOUR:   When I said “to the appeal”, I meant the appeal in that court.

MR DEMPSEY:   Yes, your Honour.

HIS HONOUR:   Part of the problem with the written submissions is that there is no reference to where order 5 of the Federal Court can be found.  Where is it to be found?

MR DEMPSEY:   I am sorry, does your Honour have ‑ ‑ ‑

HIS HONOUR:   Well, I have Mr Kearney’s affidavit and in 107 FCR he refers to order 5, but where can the order of the court joining QBE as a third respondent be found?

MR DEMPSEY:   I will seek to have a copy of the order obtained.  That order was made after the appeals in the Full Federal Court had been concluded.

HIS HONOUR:   Yes, 14 days later apparently, so it appears from Mr Kearney’s affidavit.

MR DEMPSEY:   I think one year and 14 days, your Honour.

HIS HONOUR:   It is one year and 14 days, you are right.  Is the upshot of it this, that the Full Court made a declaration in accordance with paragraph 5 of Mr  Kearney’s affidavit of 6 February?  That is, QBE be added as a third respondent in the Federal Court proceedings and also a declaration that QBE is, to the extent of its liability under the contract of insurance, liable to Dovuro to the same extent as Crop Marketing New Zealand Society Limited would have been liable but for the dissolution?

MR DEMPSEY:   That is so, your Honour.

HIS HONOUR:   That is it.  Now, what you want is simply to be joined as a party to make written submissions so that in the event that Dovuro’s appeal is successful against Wilkins you will not have to pay Dovuro’s costs of the cross‑claim.

MR DEMPSEY:   Dovuro’s costs of defending the claim by Mr Rowe’s client.

HIS HONOUR:   Right.  So you make no submission about Cropmark paying the costs of the cross‑claim?

MR DEMPSEY:   No, we accept that, your Honour.

HIS HONOUR:   You accept that.  But if Dovuro is successful against Wilkins, then you will seek an order that you do not be obliged to pay those costs?

MR DEMPSEY:   Yes, your Honour.

HIS HONOUR:   Yes, thank you, Mr Dempsey.  Well, Mr Rayment, how can you resist this order?

MR RAYMENT:   We seek to do it in two ways, your Honour.  First of all, we seek to point to the history ‑ ‑ ‑

HIS HONOUR:   Forget about the history.  Paragraph 1 of your written submissions does not seem to me to have anything to do with the case.  Carry on.  What is your next point?  What is the merits of the point?  I mean, here it is:  if you succeed against Wilkins, then you may or may not maintain the order that you have, but it is a new game if you succeed against Wilkins.  So why should not QBE, which you joined as a party in the court below, not be added as a party here?

MR RAYMENT:   Could we just seek very briefly to make clear what is in paragraph 1 before going to paragraph 2, unless your Honour is fully seized of it.

HIS HONOUR:   Well, I have read the transcripts before Justice Gummow.

MR RAYMENT:   Well, if your Honour has done that, then your Honour is fully seized of it.

HIS HONOUR:   Yes.  They came back in May, three months later, and withdrew.

MR RAYMENT:   Yes, they sought to be joined into the special leave application as a party and then ‑ ‑ ‑

HIS HONOUR:   Yes, and they got a bit of flak from Justice Gummow at that stage as to whether or not it could constitutionally be done and then they came back and ‑ ‑ ‑

MR RAYMENT:   We went and did it for them in the Federal Court and then came back here prepared to agree to it and they then withdrew it.  So we have been held up and, your Honour, if they had succeeded in that, then presumably they would have been parties to the appeal in the usual way if special leave had been granted - that is our appeal.  Then, your Honour, the order that was made in the Full Court, from which they do not appeal on the cross‑claim, was made solely in the cross‑claim, that is against them.  Your Honour follows what there was in this case was a claim ultimately pressed only against one party, Dovuro, by the applicants and Dovuro sought by way of cross‑claim orders against Cropmark and ultimately, by reason of the dissolution of that company and under the equivalent of section 6 of the ‑ ‑ ‑

HIS HONOUR:   Well, they do not dispute that you are entitled to the costs of the cross‑claim and that they are liable for that, but what they do dispute is that if you succeed against Wilkins, that then they ought to pay your costs.

MR RAYMENT:   But that was an order made against them in the cross‑claim and, your Honour, in our submission ‑ ‑ ‑

HIS HONOUR:   Of course it was, but as long as the order against you stands they had nothing to appeal against, or at least nothing that they could reasonably appeal against.  They only have any rights or arguable rights if you succeed against Wilkins.

MR RAYMENT:   Well, that is strictly true, but if your Honour looks at the reasoning behind the orders made in the Full Court, they discuss not only one possibility ‑ ‑ ‑

HIS HONOUR:   I understand what you say about Justice Gyles’ judgment and those arguments may be maintained in our Court if your appeal succeeds.  You may still succeed in maintaining your order.  The point is why should they not be made a party so that they can at least put submissions that there should be a difference?  By hypothesis there will be a difference if you succeed in your appeal.

MR RAYMENT:   We really have put it in writing as strongly as we can.  We submit that the history would be against them and that the order effectively is an appeal in other proceedings, that is the cross‑claim, in respect of which they have no grant of special leave.

HIS HONOUR:   Yes.  Now, Mr Dempsey, why did you withdraw your application when it came before Justice Gummow the second time back on 7 May?

MR DEMPSEY:   Your Honour, I can only say that that was a matter of instructions.  I realise that that is an unhelpful answer to the Court.

HIS HONOUR:   Yes.

MR DEMPSEY:   I am not in a position to elaborate beyond it.

HIS HONOUR:   Well, I do not think it makes any difference except perhaps on the question of costs.  Thank you, Mr Dempsey.

MR RAYMENT:   We would seek the costs, if your Honour pleases.

HIS HONOUR:   In this summons, QBE seeks to be joined as a party to an appeal to be heard next month in this Court with Dovuro Pty Limited as appellant, Robert John Wilkins and others as first respondent and Crop Marketing New Zealand Society Limited as the second respondent.  QBE seeks to be joined as a third respondent.

The basis of the application is that QBE is the insurer of Crop Marketing New Zealand Society Limited, which has gone into liquidation and will play no part in the hearing of the appeal.  The judgment which is the subject of appeal in this matter was given by the Full Court of the Federal Court on 5 March 2001.  Over a year later, on 19 March 2002, the Federal Court granted Dovuro leave to join QBE as the third respondent in the Federal Court proceedings.  The Federal Court also declared that QBE was, to the extent of its liability pursuant to the relevant contract of insurance, liable to Dovuro to the same extent as Crop Marketing New Zealand Society Limited would, but for its dissolution, have been liable.

As a result of orders made by the Full Court of the Federal Court in the proceedings, Cropmark is liable to pay Dovuro’s costs of a cross‑claim and also the costs incurred by Dovuro in defending the claim by the first respondent, Wilkins and others.  QBE submits that, if Dovuro is successful in its appeal against the orders obtained against it by Wilkins, the costs orders made against Cropmark in respect of Dovuro, defending the claim by Wilkins, should be varied.  It asks that it be joined as a respondent to the appeal in this Court and has submitted that it would undertake to make submissions in writing as to the form of the costs orders to be made in favour of Dovuro if it is successful on the appeal against Wilkins and others.

In my opinion, it is proper in the circumstances to join QBE as a third respondent in the proceedings in this Court.  If Dovuro is successful in its appeal against Wilkins’ interests, it is at least arguable that this Court would take a different view about so much of the costs orders that required Cropmark to pay the costs of Dovuro defending the claim brought against it by Wilkins.  Since Cropmark will not be putting submissions before the Court and since, in effect, QBE stands in its shoes, I think it is proper that QBE be joined as a party so that it can make submissions in relation to the costs.

Accordingly, I would order that:

1.        QBE Insurance International Limited be served with the notice of appeal filed in appeal No S29 of 2001 filed in the Sydney Registry of the High Court;

2.        That thereupon QBE Insurance International Limited be added as a party to the appeal under the powers conferred by Order 70 rule 5(2) of the High Court Rules;

3.        That QBE’s submissions be by way of written submissions;

4.        That the costs of this summons be Dovuro’s costs in the appeal;

5.        I certify for counsel.

Is there anything further?

MR DEMPSEY:   May it please the Court.

HIS HONOUR:   Adjourn the Court.

AT 10.21 AM THE MATTER WAS CONCLUDED