Farmers Fruit Box & Plastics Pty Ltd v Select Carbon Pty Ltd

Case [2023] QSC 241

SUPREME COURT OF QUEENSLAND

CITATION:

Farmers Fruit Box & Plastics Pty Ltd & Anor v Select Carbon Pty Ltd & Anor [2023] QSC 241

PARTIES:

FARMERS FRUIT BOX & PLASTICS PTY LTD (AS TRUSTEE FOR THE FARMERS FRUIT BOX UNIT TRUST)
ACN 004 359 979

(first plaintiff)
ALAN BRADLEY JORGENSEN (AS TRUSTEE FOR THE FARMERS FRUIT BOX UNIT TRUST)
(second plaintiff)

v
SELECT CARBON PTY LTD
ACN 143 394 138

(first defendant)
DARALEIGH PTY LTD (AS TRUSTEE FOR THE CHALMYNIA UNIT TRUST)
ACN 010 883 093

(second defendant)

FILE NO/S:

BS 1335/23

DIVISION:

Trial Division

PROCEEDING:

Miscellaneous Civil Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

31 October 2023

DELIVERED AT:

Brisbane

HEARING DATE:

11 October 2023

JUDGE:

Bradley J

ORDER:

The order of the Court is that:

1. Pursuant to r 171(2) of the Uniform Civil Procedure Rules 1999 (Qld):

(a)     The plaintiffs’ statement of claim filed on 3 February 2023 is struck out; and

(b)     The plaintiffs pay the defendants’ costs of the applications filed on 18 August 2023 calculated on the indemnity basis.

2. Pursuant to s 5(2) of the Vexatious Proceedings Act 2005 (Qld) (the Act), the defendants have leave to apply to the Court for a vexatious proceedings order in relation to Alan Bradley Jorgensen.

3. Pursuant to s 6(2) of the Act:

(a)     All of proceeding BS 1335/23, instituted by Alan Bradley Jorgensen, is permanently stayed;

(b)     Alan Bradley Jorgensen is prohibited from instituting proceedings in Queensland with respect to, connected with, or arising out of:

(i)      the dispute between the plaintiffs and the defendants the subject of proceeding BS 1335/23 (the “Dispute”), or

(ii)     the Farmers Fruit Box Unit Trust (the “FFBUT”),

without the prior leave of the Court;

(c)     Alan Bradley Jorgensen is prohibited from causing any proceeding to be instituted in Queensland with respect to, connected with, or arising out of the Dispute or the FFBUT, without the prior leave of the Court; and

(d)     Alan Bradley Jorgenson pay the defendants’ costs of proceeding BS 1335/23 to be calculated on the indemnity basis.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – PLEADINGS – STRIKING OUT – FRIVOLOUS OR VEXATIOUS PLEADING – where the first plaintiff commenced proceedings in 2021 in New South Wales against the defendants and another company – where the Supreme Court of New South Wales, inter alia, struck out the statement of claim, gave leave to replead, and stayed the proceeding against the second defendant pending payment by the first plaintiff of its costs – where the first plaintiff did not replead or pay the second defendant’s costs – where the New South Wales proceeding remains on foot – where the current proceeding arises out of the same facts, and claims the same relief, as in the New South Wales proceeding – where the plaintiffs offer various justifications for the abandonment of the New South Wales proceeding and the institution of the Queensland proceeding – whether the statement of claim should be struck out,…

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Details
AGLC
Farmers Fruit Box & Plastics Pty Ltd v Select Carbon Pty Ltd [2023] QSC 241
Case
[2023] QSC 241
Decision Date

CaseChat Overview and Summary

Farmers Fruit Box & Plastics Pty Ltd (FFBP) and another entity, Farmers Fruit Box Unit Trust (FFBUT), have commenced proceedings against Select Carbon Pty Ltd and Daraleigh Property Pty Ltd. The plaintiffs claim damages for negligence, trespass, nuisance, and breach of contract, arising from an incident in February 2017 when Select Carbon's machinery malfunctioned and caused damage to FFBUT's stock. This case involves the same facts and seeks the same relief as a previous proceeding in the Supreme Court of New South Wales, which was struck out due to pleading deficiencies. The defendants seek orders to strike out the current statement of claim, permanently stay the proceeding, and impose a vexatious proceedings order on one of the plaintiffs' directors, Alan Bradley Jorgensen.

The court had to determine whether the current proceeding should be struck out as an abuse of process, and whether a vexatious proceedings order should be made against Mr Jorgensen. The key issue was whether the plaintiffs had a proper justification for maintaining the Queensland proceeding while the New South Wales proceeding remained on foot. The court noted that Mr Jorgensen, who is a director of FFBP and claims to be a trustee of the FFBUT, had not provided a proper justification for the Queensland proceeding. The court found that the Queensland proceeding was an abuse of process, and that comity also supported striking it out.

The court found that the Queensland proceeding was an abuse of process because it was not properly justified, and it had the effect of avoiding the costs order made in the New South Wales proceeding. The court also found that Mr Jorgensen had previously been found to be a vexatious litigant, and that the current proceeding was calculated to evade the effect of the costs order made in the New South Wales proceeding. The court held that the Queensland proceeding should be struck out, and that Mr Jorgensen should be restrained from instituting or causing to be instituted proceedings similar to the current proceeding without the prior leave of the court.

The court ordered that the plaintiffs' statement of claim be struck out, and that the proceeding be permanently stayed. The court also granted the defendants leave to apply for a vexatious proceedings order in relation to Mr Jorgensen, and prohibited him from instituting or causing to be instituted proceedings in Queensland with respect to the dispute between the plaintiffs and the defendants, or the FFBUT, without the prior leave of the court. Finally, the court ordered Mr Jorgensen to pay the defendants' costs of the proceeding on the indemnity basis.

Orders

Orders of the court

The order of the Court is that:

1. Pursuant to r 171(2) of the Uniform Civil Procedure Rules 1999 (Qld):

(a) The plaintiffs’ statement of claim filed on 3 February 2023 is struck out; and

(b) The plaintiffs pay the defendants’ costs of the applications filed on 18 August 2023 calculated on the indemnity basis.

2. Pursuant to s 5(2) of the Vexatious Proceedings Act 2005 (Qld) (the Act), the defendants have leave to apply to the Court for a vexatious proceedings order in relation to Alan Bradley Jorgensen.

3. Pursuant to s 6(2) of the Act:

(a) All of proceeding BS 1335/23, instituted by Alan Bradley Jorgensen, is permanently stayed;

(b) Alan Bradley Jorgensen is prohibited from instituting proceedings in Queensland with respect to, connected with, or arising out of:

(i) the dispute between the plaintiffs and the defendants the subject of proceeding BS 1335/23 (the “Dispute”), or

(ii) the Farmers Fruit Box Unit Trust (the “FFBUT”),

without the prior leave of the Court;

(c) Alan Bradley Jorgensen is prohibited from causing any proceeding to be instituted in Queensland with respect to, connected with, or arising out of the Dispute or the FFBUT, without the prior leave of the Court; and

(d) Alan Bradley Jorgenson pay the defendants’ costs of proceeding BS 1335/23 to be calculated on the indemnity basis.

Background

Background to the litigation

Alternatively, the defendants seek orders that the plaintiffs provide security for the defendants’ costs of the proceeding, and that the proceeding be stayed until the security is provided.Background From about August 2016, Farmers Fruit Packaging Pty Ltd (FFP) leased premises from the second defendant (Daraleigh) near Innisfail in north Queensland. FFP was then the trustee of the FFBUT. From the premises, FFP operated a business importing and re-selling packaging boxes for bananas. FFP is not a party to this proceeding. The first defendant (Select Carbon) operated a business from adjacent premises, which it leased from Daraleigh. Select Carbon’s business involved the production of pulverised charcoal. In February 2017, some machinery used by Select Carbon malfunctioned, producing a thick layer of black carbon dust. The plaintiffs allege that this caused extensive damage to FFP’s stock and prevented FFP carrying on its business. In March 2018, Mr Jorgensen, on behalf of FFP, executed a deed of assignment. By the deed, FFP purported to appoint the first plaintiff (FFBP) as trustee of the FFBUT in place of FFP, and FFP purported to assign its claims against the defendants to FFBP. Mr Jorgensen is a director of FFBP. The NSW proceeding On 22 August 2019, FFBP commenced proceedings in the Supreme Court of New South Wales (the NSW proceeding) against the defendants and a third company, Select Carbon Bio Char Pty Ltd (SCBC). FFBP did so as trustee of the FFBUT. FFBP claimed damages for negligence, trespass, and/or nuisance (on the part of Select Carbon and SCBC), and breach of contract (on the part of Daraleigh). All these claims stemmed from the February 2017 incident. In June 2020, Mr Jorgensen says he was appointed co-trustee of the FFBUT, apparently sharing the role with FFBP. On 20 May 2021, the Supreme Court of New South Wales struck out FFBP’s statement of claim. Parker J published reasons for the decision.[1] His Honour described the pleading as defective on the basis that it did not plead the material facts necessary to establish that: (a)FFP’s cause of action had been validly assigned to FFBP; (b)Select Carbon and SCBC owed a duty of care to FFP; and (c)Daraleigh had breached its obligations to FFP under the lease. [1]Farmers Fruit Box & Plastics Pty Ltd v Select Carbon Pty Ltd [2021] NSWSC 563. The Court also: (a)gave FFBP leave to replead; (b)stayed FFBP’s claims until the NSW proceeding was brought into compliance with r 7.1 of the Uniform Civil Procedure Rules 2005 (NSW); (c)ordered FFBP to pay the costs of Select Carbon, SCBC, and Daraleigh; and(d)ordered that the proceeding against Daraleigh be stayed until FFBP paid $30,000 to Daraleigh pursuant to the costs order. FFBP has not paid $30,000 (or any amount) to Daraleigh for its costs.The Queensland proceeding On 3 February 2023, the plaintiffs brought this proceeding (the Queensland proceeding) in this Court against the defendants. The plaintiffs claim damages for negligence, trespass, and nuisance (on the part of Select Carbon), and breach of contract (on the part of Daraleigh as lessor) stemming from the February 2017 incident. The Queensland proceeding arises out of the same facts and by it the plaintiffs claim the same relief as FFBP seeks in the NSW proceeding.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

I reject Mr Jorgensen’s submission that the state of the defences is a reason to refuse to consider whether the orders the defendants seek should be granted. Nor does it provide a proper justification for FFBP maintaining multiple proceedings against the defendants.Conclusion on the strike out applications Mr Jorgensen is not a party to the NSW proceeding, but he is a party to the Queensland proceeding. Likely, this is because he does not contend he was a trustee of the FFBUT when the NSW proceeding was commenced. He contends he became a trustee before the Queensland proceeding was commenced. In any event, where the Court’s processes are being abused, “the circumstance that the abuse is effected by the use of multiple entities orchestrated by a single mind and will is no reason to tolerate it.”[16] The actions of FFBP in each of the Queensland and the NSW proceedings are controlled by Mr Jorgensen, who is the director of FFBP, says he is a trustee of the FFBUT, and is the person who has sought leave to appear for FFBP in both proceedings.[16]UBS AG v Tyne (2018) 265 CLR 77, 96 [45] (Kiefel CJ, Bell and Keane JJ). Mr Jorgensen has offered several explanations for commencing the Queensland proceeding. None provides a proper justification for the maintenance of multiple proceedings against the defendants. As I understood his oral submissions, Mr Jorgensen said he did not want to have two separate proceedings. He wanted to end the NSW proceeding and pursue the Queensland proceeding. He had not taken the steps necessary to bring about that result. He gave no indication that he was, even now, unwilling to take those steps. In the absence of proper justification for the Queensland proceeding, and in circumstances where the NSW proceeding remains on foot, the Queensland proceeding is an abuse of process. It should be struck out. As the defendants submit, the Queensland proceeding also has the effect of avoiding the effect of the costs order made in the NSW proceeding. So, comity might be another reason to grant the defendants relief. An analogous consideration led Sofronoff P to uphold a decision of Henry J to permanently stay another proceeding instituted by Mr Jorgensen as an abuse of process.[17] As his Honour noted:“The current proceedings were calculated to evade the effect of the order that … the Alan Jorgensen interests provide security for costs before proceeding with the claims. All of the subsequent proceedings raise the same grounds of complaint against the same class of defendants; for that reason alone, they are textbook examples of abuse of the Court’s process. They also evidence an incorrigibility in the behaviour of the plaintiffs who are all associated with Alan Jorgensen that justifies the injunction that was granted. It is the only possible effective relief against this conduct.”[17]Jorgensen v Jorgensen [2017] QCA 110. It is “a serious thing to keep a person out of the courts”, but it is sufficiently clear in this case that, having regard to the fact that “the resources of the court are not limitless and must be deployed responsibly”, the plaintiffs ought to be restrained from abusing those resources.[18][18]Hambleton v Labaj [2011] QCA 17, [71] (White JA).Vexatious proceedings application

Ratio Decidendi

Legal Principle Established

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