Grant v Eddington - [2000] FCA 1550

FEDERAL COURT OF AUSTRALIA
Grant v Eddington [2000] FCA 1550
PRACTICE AND PROCEDURE - Application to strike out the statement of claim - consideration of the applicant using as a direct template pleadings against him in another matter.
Prudential Assurance Co Ltd v Newman Industries & Ors (No 2) [1982] 1 Ch 204 (CA) Cited
Gould v Vaggelas (1985) 157 CLR 215 Cited
Re Wakim ex parte McNally (1999) 198 CLR 511 Cited
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Cited
STEPHEN FREDERICK GRANT v BARRY EDDINGTON
Q287 OF 1999
COOPER J
BRISBANE
1 NOVEMBER 2000

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

Q287 OF 1999

BETWEEN:

STEPHEN FREDERICK GRANT
APPLICANT

AND:

BARRY EDDINGTON
RESPONDENT

JUDGE:

COOPER J

DATE OF ORDER:

1 NOVEMBER 2000

WHERE MADE:

BRISBANE

THE COURT ORDERS THAT:
1.The statement of claim be struck out.
2.The applicant, Stephen Frederick Grant, pay the respondent Barry Eddington, his costs of and incidental to the notice of motion to strike out the statement of claim, including reserved costs, if any, to be taxed if not agreed.
3.The proceedings be listed before a Deputy District Registrar for directions as to the future conduct or disposition of the proceedings.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

Q287 OF 1999

BETWEEN:

STEPHEN FREDERICK GRANT
APPLICANT

AND:

BARRY EDDINGTON
RESPONDENT

JUDGE:

COOPER J

DATE:

1 NOVEMBER 2000

PLACE:

BRISBANE

REASONS FOR JUDGMENT
BACKGROUND

In proceedings S91 of 1999, the Australian Competition and Consumer Commission (“the ACCC”) commenced proceedings against Stephen Frederick Grant for relief under the Trade Practices Act 1974 (Cth) (“the Act”).
The ACCC alleged that Mr Grant aided or abetted, or was directly or indirectly knowingly concerned in, or a party to, contraventions of ss 52 and 59(2) of the Act by The Furniture Wizard Pty Ltd (“the company”). The ACCC alleged that Mr Grant was at all material times the managing director and sole shareholder of the company. It alleged that Mr Grant instructed certain named employees of the company, including Mr Barry Eddington, as to representations to be made to prospective franchisees of the company. Those representations, it is alleged, were false and misleading in contravention of ss 52 and 59(2) of the Act.
On 1 December 1999, Mr Grant commenced these proceedings against Mr Eddington as respondent.
PRESENT APPLICATION
Mr Eddington has sought to have the statement of claim filed by Mr Grant on 1 December 1999 struck out on the grounds that :
(a)it discloses no reasonable cause of action appropriate to the nature of the pleading;
(b)it has a tendency to cause prejudice, embarrassment or delay in the proceeding;
(c)it comprises a proceeding that is frivolous or vexatious; or
(d)the proceeding is otherwise an abuse of the process of the Court.
CONCLUSION ON THE APPLICATION
A comparison of the pleadings in the ACCC proceedings with the pleadings in the within action…

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: [2000] FCA 1550
Decision Date: 1 NOVEMBER 2000

CaseChat Overview and Summary

The case of Grant v Eddington involves a dispute where Mr Eddington has sought to have the statement of claim filed by Mr Grant on 1 December 1999 struck out. The grounds for this application include claims that the statement of claim discloses no reasonable cause of action, has a tendency to cause prejudice, embarrassment, or delay in the proceeding, comprises a proceeding that is frivolous or vexatious, or is otherwise an abuse of the process of the Court. The court was required to decide whether the statement of claim met the necessary legal standards and whether proceeding with it would be appropriate.

The court examined the pleadings and compared them to those in the Australian Competition and Consumer Commission (ACCC) proceedings. It found that the ACCC pleadings had been used as a template for the current proceedings, with certain allegations removed or altered to reflect Mr Eddington’s specific position. Despite these alterations, the court noted that significant portions of the pleadings remained unchanged. Moreover, the new allegation in paragraph 42 of Mr Grant’s statement of claim was scrutinised, as it introduced an additional claim of obtaining money under false pretenses and by supplying misleading information. The court also considered the allegations of breaches of sections 52 and 59 of the Act and the specific conduct detailed in the pleadings.

After reviewing the pleadings, the court concluded that the statement of claim was largely a rehash of the ACCC proceedings with insufficient alteration to warrant a separate legal action. The court held that the statement of claim did not meet the necessary legal standards and that proceeding with it would be an abuse of the court's process. Consequently, the court granted Mr Eddington’s application to strike out the statement of claim. Furthermore, Mr Grant was ordered to pay Mr Eddington’s costs of and incidental to the motion, including reserved costs if any. Finally, the court listed the proceedings for further directions to determine the future conduct or disposition of the case.

Orders

Orders of the court

1. The statement of claim be struck out.

2. The applicant, Stephen Frederick Grant, pay the respondent Barry Eddington, his costs of and incidental to the notice of motion to strike out the statement of claim, including reserved costs, if any, to be taxed if not agreed.

3. The proceedings be listed before a Deputy District Registrar for directions as to the future conduct or disposition of the proceedings.

Note:

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

Mr Eddington has sought to have the statement of claim filed by Mr Grant on 1 December 1999 struck out on the grounds that :(a)it discloses no reasonable cause of action appropriate to the nature of the pleading;(b)it has a tendency to cause prejudice, embarrassment or delay in the proceeding;(c)it comprises a proceeding that is frivolous or vexatious; or(d)the proceeding is otherwise an abuse of the process of the Court.CONCLUSION ON THE APPLICATION A comparison of the pleadings in the ACCC proceedings with the pleadings in the within action demonstrate that the ACCC pleadings have been used as a template for the application and statement of claim in these proceedings. Mr Grant has deleted such of the allegations in the ACCC pleadings as involves allegations of direct conduct on his part or on the part of another employee. Where the ACCC pleading alleges conduct against the company, Mr Grant and Mr Eddington, references to the company and Mr Grant are removed. Thus paragraphs 2 to 20 inclusive of the ACCC statement of claim are identical with paragraphs 12 to 19 inclusive of the present statement of claim, except that paragraph 4 of Mr Grant’s statement of claim reflects Mr Eddington’s position with the company rather than Mr Grant’s. Paragraphs 28 to 43 inclusive of the ACCC statement of claim which deal with representations allegedly made to a Mr and Mrs Kingham are deleted, as are paragraphs 59 to 75 which deal with representations allegedly made to a Mr Cepon. The present statement of claim includes a new allegation in paragraph 42 in the following terms :“42. That the Respondent obtained from the Applicant money for commissions and bonuses for the sale of franchises during the period July 1997 to September 1998 totaling [sic] $96,500.00 (ninety six thousand five hundred dollars). That the respondent obtained same money under false pretenses [sic] and by supplying misleading information. The Applicants company and reputation was damaged in the process.” The ACCC statement of claim alleged in paragraphs 76 to 84 inclusive :“76. The respondent has engaged in similar conduct with other purchasers of a Furniture Wizard Pty Ltd franchise amounting to breaches of sections 52 and 59 of the Act.77. The respondent has engaged and is continuing to engage in similar conduct in respect of purchases or prospective purchases of franchises from Surface Master Pty Ltd which conduct amounts to breaches of sections 52 and 59 of the Act.78. The respondent has engaged and is continuing to engage in similar conduct in respect of purchasers or prospective purchasers of a franchise from Furniture Master Pty Ltd contrary to sections 52 and 59 of the Act.79. Unless restrained, the respondent will continue to engage in conduct that amounts to a breach of sections 52 and 59 of the Act.80. Further and better particulars of the matters referred to in paragraphs 76 - 78 (above) will be supplied prior to trial.CONTRAVENTIONS81. By reason of the matters referred to in paragraphs 27, 43, 58 and 75 above the Company, in trade or commerce:(a)engaged in conduct that was, in all the circumstances, misleading or deceptive, or likely to mislead or deceive, contrary to the provisions of section 52 of the Act;(b)invited, by advertisement and representations, members of the public to engage or participate in the business of mobile furniture repair and restoration and laminex repair business for the Company and Respondent, requiring performance by franchisees of work, and, with respect to the profitability of such business and the work required to perform such business, made representations that were false or misleading in a material particular, contrary to the provisions of sub-section 59(2) of the Act.82. On each occasion that the Company contravened section 52 and sub-section 59(2) of the Act, the Respondent :-(a)aided, abetted, counselled or procured the Company to contravene the Act;(b)further or alternatively, was knowingly concerned in or a party to the Company so contravening the Act.ParticularsThe Applicant relies on the matters pleaded in paragraphs 3 to 80 hereof.83. At all material times:(i)the conduct of the Respondent as to the matters referred to above in paragraphs 3 to 80 above, was the conduct of the Company, and the Applicant relies upon the provisions of Section 84 of the Act;(ii)the state of mind of the Respondent as to matters referred to in paragraphs 3 to 80 above was the state of mind of the Company and the Applicant relies upon the provisions of Section 84 of the Act.84. The Applicant seeks the Orders set out in the Application in these proceedings.”

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q287 OF 1999

BETWEEN:	STEPHEN FREDERICK GRANT APPLICANT
AND:	BARRY EDDINGTON RESPONDENT
JUDGE:	COOPER J
DATE OF ORDER:	1 NOVEMBER 2000
WHERE MADE:	BRISBANE

JUDGE:	COOPER J
DATE:	1 NOVEMBER 2000
PLACE:	BRISBANE