Gold Developments Pty Ltd v Queensland Inspection Services Pty Ltd
[2022] FedCFamC2G 867
•21 October 2022
Federal Circuit and Family Court of Australia
(DIVISION 2)
Gold Developments Pty Ltd v Queensland Inspection Services Pty Ltd [2022] FedCFamC2G 867
File number(s): MLG 1588 of 2022 Judgment of: JUDGE BLAKE Date of judgment: 21 October 2022 Catchwords: CONSUMER LAW– PRACTICE AND PROCEDURE – Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 – Rule 9.04 – requirement that corporation be represented by a lawyer unless leave granted – relevant considerations identified and addressed – application for leave refused. Legislation: Federal Circuit and Family Court of Australia Act 2021 (Cth), ss 175, 190, 191.
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021, rr 1.07, 9.04, 13.13.
Federal Court Rules 2011, r 4.01
Supreme Court (General Civil Procedure) Rules 2005, r 1.17.
Cases cited: Bay Marine Pty Ltd v Clayton Country Properties Pty Ltd (1986) 8 NSWLR 104
Damjanovic v Maley (2002) 195 ALR 256
Molnar Engineering Pty Ltd v Burns (1984) 3 FCR 68
Pacific Air Freighters (Qld) Pty Ltd v Toller (2000) 171 ALR 519
Pharm-a-Care Laboratories Pty Ltd v Commonwealth of Australia (No 12) [2012] FCA 289
Termi-Mesh Australia Pty Ltd v Josu Manufacturing Pty Ltd [1999] FCA 1241
Wong v Dong Lai Sun Massage [2016] FCCA 18
Worldwide Enterprises Pty Ltd v Silberman & Anor [2010] VSCA 17
Division: Division 2 General Federal Law Number of paragraphs: 19 Date of hearing: 11 October 2022 Place: Melbourne Advocate for the Applicant: Mr M Kitanovski Solicitor for the Applicant: None Counsel for the Respondent: Ms S Hogan Solicitor for the Respondent: Mills Oakley ORDERS
MLG 1588 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: GOLD DEVELOPMENTS PTY LTD
Applicant
AND: QUEENSLAND INSPECTION SERVICES PTY LTD
Respondent
order made by:
JUDGE BLAKE
DATE OF ORDER:
21 OCTOBER 2022
THE COURT ORDERS THAT:
1.The Application in a Proceeding filed by the Applicant on 9 September 2022 is dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE BLAKE
This is an application by Gold Developments Pty Ltd (‘Company’). It seeks an order that leave be given to its sole director, Mendo Kitanovski, to represent the Company in the present proceeding. The application is opposed by the respondent.
BACKGROUND
On 8 July 2022, the Company filed an application and Statement of Claim in the Court. The application and Statement of Claim were prepared by Mr Kitanovski on behalf of the Company. For present purposes, it is sufficient to record that in the Statement of Claim, the Company makes various claims against the respondent including for misleading and deceptive conduct under section 18 of the Australian Consumer Law, injurious falsehood and defamation.
On 29 August 2022, the matter came on for directions before me. Mr Kitanovski sought to appear for the Company and Ms White, solicitor, appeared for the respondent. On that day, I made orders that the respondent file and serve a Defence within 28 days. I also listed the matter for further mention on 11 October 2022. I noted in the order that on 11 October 2022, the Court would consider the next set of procedural orders including whether Mr Kitanovski would be given leave to represent the Company in the proceeding.
Mr Kitanovski subsequently filed an Application in a Proceeding seeking an order that he be given leave to represent the Company. He has also filed an affidavit in support of that application on 9 September 2022 that he seeks to rely on. I note that Mr Kitanovski filed a further affidavit on 7 October 2022 that goes in the main to other issues. The respondent filed an outline of submissions and an affidavit of its solicitor, Ms White on 7 October 2022.
PRINCIPLES
Section 175 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (‘FCFCOA Act’) provides as follows:
Representation
A party to a proceeding before the Federal Circuit and Family Court of Australia (Division 2) is not entitled to be represented by another person unless:
(a)under the Judiciary Act 1903 , the other person is entitled to practise as a barrister or solicitor, or both, in a federal court; or
(b)under the regulations, the other person is taken to be an authorised representative; or
(c)another law of the Commonwealth authorises the other person to represent the party.
Rule 9.04 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (‘Rules’) provides as follows:
Corporation must be represented
Except as provided by or under an Act or regulations made under an Act, or with the leave of the Court, a corporation may not start or carry on a proceeding otherwise than by a lawyer.
Of course, the Court may, in the interests of justice, dispense with compliance with the Rules: Rule 1.07.
In considering and applying the Rules, it is important to note the obligations contained in section 190 and 191 of the FCFCOA Act. Section 191 requires the parties to a civil proceeding to act consistently with the overarching purpose in section 190 of the Act. Section 190 requires, inter alia, the civil practice and procedure provisions to be exercised in a way that best promotes the overarching purpose. Section 190 provides as follows:
Overarching purpose of civil practice and procedure provisions
(1)The overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes:
(a) according to law; and
(b) as quickly, inexpensively and efficiently as possible.
Note 1: See also paragraphs 5(a) and (b).
Note 2:The Federal Circuit and Family Court of Australia (Division 2) must give effect to principles in the Family Law Act 1975 when exercising jurisdiction in relation to proceedings under that Act.
(2)Without limiting subsection (1), the overarching purpose includes the following objectives:
(a)the just determination of all proceedings before the Federal Circuit and Family Court of Australia (Division 2);
(b)the efficient use of the judicial and administrative resources available for the purposes of the Court;
(c) the efficient disposal of the Court's overall caseload;
(d) the disposal of all proceedings in a timely manner;
(e)the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.
(3)The civil practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose.
(4)The civil practice and procedure provisions are the following, so far as they apply in relation to civil proceedings:
(a) the Rules of Court;
(b)any other provision made by or under this Act or any other Act with respect to the practice and procedure of the Federal Circuit and Family Court of Australia (Division 2).
Rules similar to rule 9.04 are to be found in other Courts: see for example, rule 4.01 of the Federal Court Rules 2011; rule 1.17 of the Supreme Court (General Civil Procedure) Rules 2005. There are numerous authorities dealing with the matters a Court is to consider when deciding whether to require. Mr Kitanovski drew to the Court's attention the decision of the Victorian Supreme Court in Worldwide Enterprises Pty Ltd v Silberman & Anor [2010] VSCA 17 (‘Worldwide Enterprises’). Other decisions also relevant, and decided under Commonwealth Law, include cases such as Pharm-a-Care Laboratories Pty Ltd v Commonwealth of Australia (No 12) [2012] FCA 289 (‘Pharm-a-Care’); Damjanovic v Maley (2002) 195 ALR 256 (‘Damjanovic’), Molnar Engineering Pty Ltd v Burns (1984) 3 FCR 68 (‘Molnar’), Termi-Mesh Australia Pty Ltd v Josu Manufacturing Pty Ltd [1999] FCA 1241 (‘Termi-Mesh’), Pacific Air Freighters (Qld) Pty Ltd v Toller (2000) 171 ALR 519 (‘Pacific Air Freighters’), Bay Marine Pty Ltd v Clayton Country Properties Pty Ltd (1986) 8 NSWLR 104 (‘Bay Marine’).
Rule 1.07 makes clear that the guiding principle for the Court to exercise its discretion to dispense with compliance with rule 9.04 is the ‘interests of justice'. Further, the power to dispense with the requirement should be exercised by reference to 'all relevant considerations' see Molnar at 73. A review of the authorities referred to disclose that the following considerations, among others, are relevant to the Court exercising its discretion to dispense with the requirement in rule 9.04: the complexity of the case (see Termi-Mesh at [13]); the manner in which the case has progressed at the time application is made and the manner in which it may proceed in the future (see Worldwide Enterprises at [41]); financial considerations which would inhibit a company from obtaining representation (noting the onus is on an applicant seeking to dispense with the requirement of legal representation to provide evidence of financial incapacity: see Termi-Mesh at [13]); the ability of the representative to exercise the objectivity of a practitioner (see Pacific Air Freighters at 522); whether the matter can be conducted in an orderly manner without a solicitor (see Worldwide Enterprises at [34]); whether the lack of disciplinary measures in relation to the person seeking to represent the company will affect the administration of justice (see Pharm-a-Care at [20]-[21]; Damjanovic at [74]); whether the person seeking to represent the company is likely to be a principal witness in the trial particularly if credit is an issue (see Bay Marine at 113) and the effect, if any, that a grant of leave will have on the Court resources and the effect upon other litigants in the Court list (see Worldwide Enterprises at [35]). The predecessor Court to this Court also held that the objects and purposes of the governing legislation and rules relating to case management considerations should also be taken into account: Wong v Dong Lai Sun Massage [2016] FCCA 18 at [19]. That observation is consistent with what is set out in section 190 and 191 of the FCFCOA Act.
CONSIDERATION
Mr Kitanovski made brief submissions before the Court as to why leave should be granted to him to represent the Company. The substance of his submissions were contained within his affidavit of 9 September 2022.
Mr Kitanovski contends that the issues are simple and clear-cut and the matter can be swiftly concluded with him running the case. On one view, the issue might be described as straightforward. The dispute between the parties arises because the Company claims the respondent declared a vehicle of a particular customer to have failed a ‘WOVI inspection’ and because the respondent then allegedly made various statements including that the failure was due to certain equipment supplied by the Company being ‘aftermarket’ or ‘non-genuine parts’. The dispute therefore appears confined to a single interaction with a customer and appears confined in time. This is not a case with a multiplicity of factual issues. Conversely, however, while the factual matrix of the case may be described as limited, the claims arising from the factual dispute are not straightforward. The claims advanced in the Statement of Claim are arguably complex and include claims for misleading and deceptive conduct, injurious falsehood and defamation. The pursuit of such claims, whatever their basis in fact, in my experience, is never simple or straightforward. That Mr Kitanovski may experience some difficulty in advancing these claims on behalf the Company can be seen from, among other things, an examination of the Statement of Claim which contains limited particulars in relation to various factual matters and Mr Kitanovski's difficulty in being able to address the elements of each cause of action being pursued by the Company.
Mr Kitanovski submits that he is able to run the matter and there has been no complaint about his pleadings. The last aspect of that submission is not accurate. Various paragraphs in the Defence take issue with quality of the Statement of Claim including paragraphs 7 to 10. Moreover, paragraph 13 of the Defence states that the respondent intends to seek an order for summary dismissal pursuant to rule 13.13 of the Rules. In short, there is a challenge to the pleaded case and the quality of the pleading.
It is then necessary to consider the interrelated issues of the manner in which the case has progressed to date, the manner in which the case can proceed in the future and whether the case can proceed in an orderly fashion without a solicitor. Mr Kitanovski is clearly a man of some intelligence. He has commenced the proceedings on behalf of the Company, drawn the Statement of Claim, filed a proper application with supporting affidavit in relation to the question of leave under rule 9.04, has some familiarity with the authorities under rule 9.04 and appeared before me on two occasions. He has been courteous and considered in the manner in which he has addressed the Court. He has also endeavoured to progress the matter including through exchanges with the respondent about Discovery. To this point, he has been able to articulate the Company's position. These matters all suggest to me that Mr Kitanovski has some capacity to continue to run the matter.
While matters have progressed somewhat smoothly to date, the following should be noted. First, there is, in my view, some basis for the complaints made by the respondent about the Statement of Claim. I accept that Mr Kitanovski has the capacity to put the position of the Company before the Court in a general sense, but I have little confidence that he can meaningfully address the Court in relation to each of the elements of each of the causes of action the Company brings before the Court, or that he can properly identify and place before the Court the evidence necessary to make good on those causes of action. Second, while matters may he said to have progressed reasonably smoothly to date, it is unlikely that that will be the position going forward. On the issue of discovery, while the parties have exhibited some willingness to exchange documents, Mr Kitanovski (not surprisingly) confused discovery of documents with requests for information. It seems likely from the indication given in the Defence that there may well be a challenge to the Statement of Claim and that an application for summary dismissal is in the offing. Assuming the Company overcomes those particular difficulties, there is then the question of the trial, the causes of action to be pursued, and the principles and evidence connected with those causes of action. It is far from certain that Mr Kitanovski will be able to competently address these matters and ensure that the case proceeds in an orderly fashion.
That a trial will ultimately need to be conducted leads to a further issue. It seems almost certain that Mr Kitanovski will have to give evidence in the proceeding, including in relation to his dealings with the respondent on behalf of the Company, any dealings with the customer in question and the equipment the Company supplied to the customer. Mr Kitanovski may therefore find himself in the witness box while at the same time seeking to represent the Company and its interests. While it is difficult to assess at this time, it is not out of the question that his personal interests as an individual and director may not align with those of the Company depending on the course the evidence takes. Furthermore, as the respondent points out, in a case such as this, Mr Kitanovski may face some difficulty dealing with objections to evidence and the like given the dual role he seeks to fulfil.
An issue arises as to the lack of disciplinary measures available in relation to the person seeking to represent the Company. From my interactions with Mr Kitanovski, he seems likely to be a person who will do his best and will not deliberately mislead the Court. While that might be the case, it seems unlikely that Mr Kitanovski will approach the matter in a manner consistent with a legal representative, who owes an overriding duty to the Court. The Court is entitled to expect that in a case such as the present.
One of the considerations referred to in the authorities is the financial capacity of the Company to pay for representation. On this issue, Mr Kitanovski says that legal representation would be unlikely to enhance the timely and efficient conduct of the matter, and it would increase the costs involved. Critically, however, Mr Kitanovski has not placed any evidence before the Court in relation to the financial position of the Company. There are therefore not any financial considerations which would inhibit the Company from engaging legal representation.
Finally, it is necessary for the Court to consider the overarching purpose. For the reasons I have articulated above, I expect the conduct of this litigation to become more complicated. That will in turn require the Court to devote more time not only to issues that arise between the parties in the interlocutory stages, but also at final hearing. While Mr Kitanovksi has done a reasonable job to date, it is apparent from some of the issues that were raised in the hearing before me and from a review of the Statement of Claim that he will struggle to be of great assistance going forward. It is well-known that this is a busy Court with significant backlogs in its caseload. The Court therefore needs to be mindful of the impact of this case on other litigants. More time spent on this case (in circumstances where such an outcome can be avoided if the Company engages legal representation) means less time for dealing with other litigants and the backlog of cases that this Court confronts. Moreover, more time spent on this case means that the respondent necessarily has to spend more time on the proceeding (be it in preparation, or time in Court or both) and more funds than it might otherwise have to if the Company engages lawyers. I am therefore not satisfied that waiving compliance with the rule 9.04 will promote the overarching purpose set out in section 190 of the FCFCOA Act. In my view, granting the Company's application would not lead to an efficient use of judicial resources. Granting the application would also not lead to the disposal of this proceeding in a timely manner and it would not assist the Court to efficiently dispose of its overall caseload.
When all of these matters are considered, in my view, it is not in the interests of justice that compliance with rule 9.04 be dispensed with. In my view, it is in the interests of justice that the Company be legally represented. For these reasons, I dismiss the Application in a Proceeding filed 9 September 2022. The Company should take steps to ensure that it is properly represented before me on the next occasion. On that issue, I note the matter is already set down for further mention on 6 December 2022.
I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Blake. Associate:
Dated: 21 October 2022
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