Holmes v Dale
[2022] WADC 87
•9 SEPTEMBER 2022
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: HOLMES -v- DALE [2022] WADC 87
CORAM: PRINCIPAL REGISTRAR MCGIVERN
HEARD: 25 AUGUST 2022 AND 31 AUGUST 2022
DELIVERED : 31 AUGUST 2022
PUBLISHED : 9 SEPTEMBER 2022
FILE NO/S: CIV 3488 of 2021
BETWEEN: KINGSLEY WENDALL HOLMES
Plaintiff
AND
MATTHEW ANDREW DALE
First Defendant
1865 PTY LTD
Second Defendant
Catchwords:
Practice and procedure - Where second defendant a company of which first defendant is sole director and shareholder - Where first defendant purported to enter an appearance and defence own behalf and on behalf of second defendant - Application to strike out parts of defence and for orders requiring second defendant to file a notice of change of representation - Effect of O 12 r 1(2) and O 2 r 1 of the Rules of the Supreme Court - Court's inherent power to regulate its own practice and procedure - Appearance and defence filed contrary to O 12 r 1(2) rejected and uplifted - Parts of defence struck out
Legislation:
Rules of the Supreme Court 1971 (WA), O 1 r 4A, O1 r 4B, O 2 r 1, O 12 r 1(2), O 20 r 19(1)
Result:
Application allowed in part
Representation:
Counsel:
| Plaintiff | : | Mr B M Grubb |
| First Defendant | : | In person |
| Second Defendant | : | In person |
Solicitors:
| Plaintiff | : | Tudori Hager Grubb |
| First Defendant | : | Not applicable |
| Second Defendant | : | Not applicable |
Case(s) referred to in decision(s):
Capricorn Society Ltd v Lucisano [No 2] [2017] WADC 89
Concrete Logistics Pty Ltd v KBC Pty Ltd [2015] WASC 284
Culleton v Permanent Custodians Ltd [2018] WASC 251
Eastern Metropolitan Regional Council v Four Seasons Construction Pty Ltd [2000] WASC 178
Glew v Frank Jasper Pty Ltd [2010] WASCA 87
Hume v Goldblaze Nominees Pty Ltd as trustee for Goldblaze Unit Trust [2021] WASCA 177
Kent v Mullally [2015] WADC 117
Neil v Nott [1994] HCA 23
Vantage Holdings Group Pty Ltd v Donnelly [No 4] [2019] WASC 398
Wentworth v Rogers (No 5) (1986) 6 NSWLR 534
PRINCIPAL REGISTRAR MCGIVERN:
[These reasons were delivered orally on 31 August 2022. They have been edited to correct matters of grammar and infelicity of expression.]
Introduction
This is an application by the plaintiff for orders striking out various paragraphs of a defence filed in the names of the first and second defendants, brought in the context of an action which in broad terms concerns the possession and ownership of two vehicles, and the sale of a piece of equipment.
The application was heard at a special appointment on 25 August 2022. I adjourned that hearing to deliver my reasons, and thereafter to hear the parties on the question of costs.
For the reasons that follow, the application is allowed in part and I have made further orders in the exercise of the court's inherent power to regulate its proceedings.[1]
Relevant procedural history
[1] More fully expressed, the court has an inherent power to regulate its own practice and procedure, to procure proper and effective administration of justice, and to prevent an abuse of its process: Concrete Logistics Pty Ltd v KBC Pty Ltd [2015] WASC 284 [5]; Capricorn Society Ltd v Lucisano[No 2][2017] WADC 89 [3] - [4].
The plaintiff:
(a)commenced the action against the defendants by a writ filed on 14 September 2021 (and amended on 11 October 2021);
(b)filed a statement of claim on 4 October 2021 (which he amended on 27 October 2021); and
(c)was initially self-represented, but has now retained solicitors (who have been on the record since 14 February 2022).
The first‑named defendant is a natural person. The second‑named defendant is a corporation. It is common cause that the first defendant is the sole director and shareholder of the second defendant.
On 24 September 2021, the first defendant filed an application seeking 'leave to appear for a corporate litigant'. That application was made in terms that included:
(a)'[the first defendant] to appear at a hearing on behalf of a corporate litigant, namely [the second defendant]';
(b)'… leave to be granted, because [the first defendant] is the owner of the [second defendant], to represent [the second defendant]; and
(c)that the first defendant, by reason of a hospital admission, had not at that time had the opportunity to engage a solicitor.
At a chambers hearing on 19 October 2021, the presiding registrar relevantly indicated that she would make an order in terms that:
'[T]he 1st defendant have leave to act in person for the 2nd defendant until further notice'.[2]
[2] ts 7, 19 October 2021.
Unfortunately, the orders made on that occasion were never extracted and so the final order was not settled. In any event, for the reasons that follow,[3] that order could have no more effect than to permit the first defendant to advocate for the second defendant.
[3] See [15] below.
On 5 April 2022, a defence was filed (and amended on 28 April 2022 and re-amended on 13 June 2022), purportedly on behalf of both the first and second defendants (for convenience, in these reasons I will refer to the re-amended defence filed on 13 June 2022 as the Defence).
By a memorandum of appearance filed on 7 April 2022, the first defendant:
(a)entered an appearance, as a self-represented litigant; and
(b)purported also to enter an appearance on behalf of the second defendant.
The application
The plaintiff brought the present application by a chamber summons filed on 20 June 2022, pursuant to which he seeks orders:
(a)pursuant to O 20 r 19(1) of the Rules of the Supreme Court 1971 (WA) (RSC), striking out various paragraphs of the Defence (the scope of which was expanded in the plaintiff's written submissions[4]);
(b)pursuant to O 12 r 1(2) RSC, requiring the second defendant to 'cause a Form 5AA Notice of Change of Representation, Service Details or Address to be filed, by an Australian legal practitioner', within seven days of the order; and
(c)that the plaintiff's costs of the application to be borne by the defendants.
[4] Plaintiff's Outline of Submissions in Support of Application to Strike Out First and Second Defendants Defence and for Orders Requiring Second Defendant to be Represented by a Solicitor filed 16 August 2022 (plaintiff's written submissions), par 3: see [26] below.
Application as it relates to the second defendant
Rules and principles
The starting point is to note that, except to the extent of any conflict with the District Court Rules 2005 (WA), the RSC apply to and in respect of any case in this court.
Relevantly:
(a)O 12 r 1(2) RSC provides that:
Except as expressly provided by any Act, a defendant to … an action which is a body corporate may not enter an appearance in the action or defend it otherwise than by a legal practitioner.
and
(b)O 2 r 1 RSC provides that a failure to comply with the requirements of the Rules is to be treated as an irregularity and shall not nullify the proceedings or any step taken in the proceedings.
In Eastern Metropolitan Regional Council v Four Seasons Construction Pty Ltd[5], Hasluck J considered the application of O 12 r 1(2) of the RSC, commenting that:
I am of the view that [the Court] does not have power to dispense with the explicit requirements of the rules with the result that, even in exceptional circumstances, an individual is not at liberty to take a step in the action on behalf of a company. This is so, notwithstanding the inherent jurisdiction of the … Court to regulate its proceedings.[6]
[5] [2000] WASC 178 (Four Seasons).
[6] Four Seasons at [47].
That view and approach has subsequently been approved and adopted, including by the Court of Appeal as recently as in October last year when, in Hume v Goldblaze Nominees Pty Ltd as trustee for Goldblaze Unit Trust[7], the court held:
Whilst the court has the power, exercisable in limited circumstances, to permit an individual who is not a legal practitioner to act as a spokesperson for a company in proceedings involving the company, the power to do so does not overcome … the Rules and the prohibition on the company itself not taking any formal step in the proceedings, other than by a solicitor.[8]
[7] [2021] WASCA 177 (Hume).
[8] Hume at [16].
That approach arguably gives rise to some tension between the effect of O 12 r 1(2) RSC on the one hand, and the effect of O 2 r 1 RSC on the other. As Hasluck J observed in Four Seasons, however, O 2 r 1 RSC 'cannot be regarded as being of the same effect as a dispensing power' in relation to O 12 r 1(2) RSC.
Consideration
I pause here to observe that the context of this application is slightly different to that in each of Four Seasons and Hume. In the latter cases:
(a)the documents sought to be filed on behalf of a company, other than by a solicitor, had been rejected by the Supreme Court registry; and
(b)the application before the court concerned an appeal against that rejection (which, in each case, was ultimately unsuccessful).
In this case, unlike Four Seasons and Hume, the registry did not refuse to accept the documents purportedly filed on behalf of the second defendant, at the time of their filing. That does not, however, cure the defect that would arise if they were treated as being the documents of the second defendant.
Rather, it is clear from the established case law that O 12 r 1(2) RSC has the effect that:
(a)the first defendant was, and is, prohibited from entering an appearance or filing a defence on behalf of the second defendant; and
(b)there is no discretion exercisable by the court in relation to that prohibition.
In the circumstances, I am not satisfied that it is appropriate to make orders in the terms proposed by the plaintiff, as outlined at [11(a)] and [11(b)] above, in relation to the second defendant. That is because:
(a)ordering the second defendant to file a notice of change of representation would be inapt in circumstances where the second defendant is not represented at all; and
(b)as to the pleadings, it would in my view be inappropriate to treat the Defence as properly being the pleadings of the second defendant at this stage.
Rather, in my view, the appropriate way for the court to give effect to the prohibition in O 12 r 1(2) RSC, which is consistent with O 2 r 1 RSC, is to now reject and uplift the documents[9] purportedly filed by or on behalf of the second defendant by the first defendant.[10]
[9] Each of which constitutes a 'procedural step' within the meaning discussed in Four Seasons.
[10] Being a person other than a legal practitioner.
If the second defendant is to defend this action, it must be legally represented and it is appropriate that some time is allowed for the first defendant[11] to engage a lawyer for that purpose.
[11] In his capacity as sole director of the second defendant.
At the hearing, the first defendant submitted that I should allow at least six weeks for the second defendant to enter an appearance. The plaintiff pointed to the passage of time that has already passed, and the first defendant's previous representations to the court that he would engage legal representation for the second defendant, which he has not done to date.
Taking account of:
(a)the case management objectives in O 1 r 4A and r 4B RSC;[12]
(b)the relative simplicity of engaging a solicitor and them entering an appearance; and
(c)the opportunity and procedural advantages that having a practitioner involved may be expected to produce (including for the first defendant),
I am satisfied that a period of 28 days is appropriate.
[12] Which relevantly include promoting the just determination of litigation, disposing efficiently of the business of the court, maximising the efficient use of available judicial and administrative resources, and facilitating the timely disposal of business.
Accordingly, in the exercise of the court's inherent power to regulate its own proceedings, I will make orders that:
(a)insofar as the appearance filed by the first defendant purports to be the appearance of the second defendant, it is rejected and is uplifted by the court;
(b)insofar as the defence filed, and subsequently amended, by the first defendant purports to be the defence of the second defendant, it is rejected and is uplifted by the court; and
(c)the second defendant has leave to enter an appearance and file a defence in the action, in accordance with O 12 r 1(2) RSC, within 28 days.
Application as it relates to the first defendant
Turning to the application of the plaintiff, as it relates to the first defendant:
(a)by his chamber summons filed on 20 June 2022, as expanded by his written submissions, the plaintiff applied for orders pursuant to O 20 r 19(1) RSC, striking out various parts of the Defence (Contested Parts), as follows: [13]
[13] Plaintiff's written submissions, par 3.
Paragraph Description Reason 8 / 8.1 / 8.2 Defendants plead a "criminal accusation" and 'allegations of dishonesty" are made by the Plaintiff. No criminal accusations or causes of action in fraud/dishonesty are pleaded.
Defendants plead evidence and not material facts - as to an alleged FOI application.
9.2 Defendants plead alleged conversations had with third parties and the words spoken. Defendants plead evidence, not material facts. 11/11.1/11.2 "Particulars" Plaintiff does not plead any damage suffered by the Defendants. No counterclaim has been filed by the Defendants. Particulars of damage allegedly sustained by the Defendants (without any Counterclaim) are irrelevant and embarrassing. 16 Ibid description 8 / 8.1 / 8.2 Ibid reasons 8 / 8.1 / 8.2 18 Entire paragraph Allegation not pleaded to. Does not specifically deny or admit transfer of any funds as alleged by the Plaintiff. 19 Entire paragraph Alleged not pleaded to. Does not specifically deny or admit the allegations pleaded by the Plaintiff. 21/21.1/9.2 Ibid description
11/11.1/11.2
Ibid reasons 11/11.1/11.2 iii) Entire paragraph Embarrassing commentary unrelated to the pleading and containing unsupported accusations against Plaintiff's Counsel. iv) Entire paragraph Embarrassing commentary unrelated to the pleading containing unsupported accusations against Plaintiff's Counsel.
Defendants also refer to inadmissible without prejudice communications.
and
(b)in general terms, the application is brought on the basis that the Contested Parts:
i)disclose no reasonable defence;
ii)are scandalous, frivolous or vexatious;
iii)would prejudice, embarrass or delay the fair trial of the action; and/or
iv)are an abuse of process[,]
for the more specific reasons set out in par 3 of the plaintiff's written submissions.
Rules and principles
The principles applicable to striking out pleadings are well established, and those of particular relevance to the application at hand are touched on briefly here.
Unrepresented litigant
First, particular caution must be exercised in relation to the pleadings of a litigant in person.[14] The court must be careful to see that the rights of an unrepresented person have not been 'obfuscated by their own advocacy'.[15]
[14] Wentworth v Rogers (No 5) (1986) 6 NSWLR 534, 536 - 537.
[15] Glew v Frank Jasper Pty Ltd [2010] WASCA 87 [10], citing Neil v Nott [1994] HCA 23 [5].
Nevertheless, while a degree of leniency and flexibility is proper, the role of and requirements for a proper pleading cannot be ignored. There is a balance to be struck, as reflected by Allanson J in Culleton v Permanent Custodians Ltd[16], who observed:
But the allowances that can be made [for a litigant in person] are necessarily limited, both as a matter of fairness to the other party, and because compliance with procedure may be necessary to ensure that the court can properly decide the dispute before it. Pleadings ensure a basic requirement of procedural fairness, and, to do so, must state the case sufficiently clearly to allow the other party a fair opportunity to meet it.
In Nyoni v Patterson [2012] WASCA 171 , Pullin JA said:
After allowing for the disadvantage an in person litigant suffers, it is still necessary, out of fairness to defendants, that the [pleading] is drawn so that when the opponent pleads to it, the pleadings will define with clarity and precision the issues or questions which are in dispute between the parties and fall to be determined by the court. ... Such clarity and precision is also necessary to inform the court about the precise matters in issue between the parties which are to be determined by the court and which set the limits of the action.
… clear and precise pleadings are necessary because they form a permanent record of the issues and questions raised in the action and decided so as to prevent future litigation upon matters already adjudicated upon between the litigants.[17]
Grounds - discloses no reasonable defence
[16] [2018] WASC 251 (Culleton).
[17] Culleton at [35].
The first ground of objection raised by the plaintiff against the Contested Parts is that they disclose no reasonable defence.
Davis DCJ has observed that in Kent v Mullally[18]:
The principles applicable to whether a pleading will be struck out as disclosing no reasonable cause of action or defence were restated by the Court of Appeal in Neilson v City of Swan [2006] WASCA 94 [18] (Buss JA; Wheeler and Pullin JJA agreeing). While these principles are couched by reference to a plaintiff's statement of claim, they apply to any pleading. Briefly, a pleading should be struck out only where the case is really not arguable – 'so clearly untenable that it cannot possibly succeed'. All the facts alleged in the pleading must be accepted as true. Great care must be exercised to ensure the party is not improperly deprived of the opportunity for trial. As a general rule a party is entitled as of right to have his case heard, the facts found and then argue questions of law. It is only in cases in which it can be seen from the outset that, however the facts be found, there is no basis for the legal conclusion contended for by the party that the pleading should be struck out.
Grounds - frivolous or embarrassing or an abuse of process
[18] [2015] WADC 117.
As to the last three objections raised by the plaintiff (which may be broadly grouped together):
(a)the key consideration for the court is whether or not the pleading meets the fundamental objectives of a pleading;
(b)it is not sufficient to strike out a pleading on these grounds merely because it is unnecessary - although unnecessary material may be struck out if it will cause delay or embarrassment. As noted by Smith J in Vantage Holdings Group Pty Ltd v Donnelly [No 4][19]:
[P]leadings may be struck out on the ground that they may prejudice, embarrass or delay the fair trial of the action because they are evasive, they conceal or obscure the real questions in controversy, they are ambiguous or not reasonably intelligible, they raise immaterial or irrelevant issues, they fail to confine the issues or state the case of the party in question with reasonable particularity, or they raise a case in terms which are simply too general.
[19] [2019] WASC 398 [60].
Consideration
Paragraphs 8, 16, 11 and 21
The first tranche of the Contested Parts are:
(a)in each of par 8 and par 16 of the Defence (which are in similar terms), the words that follow ' The First Defendant and Second Defendant deny this', as follows:[20]
[The First Defendant and Second Defendant deny this] criminal accusation, and will avail themselves of any and all powers at their disposal, including but not limited to, filing a counterclaim, including but not limited to damages, interest, and harm caused to the First Defendant and the Second Defendant by the Plaintiff. also [sic] these allegations of dishonesty and/or impropriety should not be alleged at all unless there is clear and sufficient evidence by way of pleated material facts to support them: Associated Leisure Ltd (Phonographic Equipment Company Ltd) v Associated Newspapers Ltd [1970] 2 QB 450 subsequently this evidence will come from a Freedom of Information request to the Department of Transport for the original Vehicle Transfer Document bearing the Plaintiff's signature as witnessed by the First and the Second Defendant signed under no coercion or duress whatsoever.
and
(b)related to these, the words under the heading 'Particulars' in each of pars 11/11.1/9.2 [sic] and 21/21.1/21.2, respectively (by which the first defendant states an intention to provide evidence of damage said to be sustained by the first and second defendants).
[20] Underlining added. The quoted material appears in par 8/8.1/8.1 of the Defence; in par 16 of the Defence, the underlined words have been deleted.
The plaintiff in his oral submissions objected that the first defendant has not in fact made a counterclaim and, therefore, that the pleading as it stands does not disclose a defence or is embarrassing or an abuse of process. In his written submissions, the plaintiff submits that:
(a)no criminal accusations or causes of action are pleaded in the statement of claim; and
(b)as to the reference to a Freedom of Information application, the pleading is not of material fact, but of evidence.
In the course of the hearing, and having heard the submissions of the plaintiff, I asked the first defendant whether he intended, by the contested words, in fact to bring a counterclaim against the plaintiff or whether he genuinely intended merely to flag his intention to do so at a later date. He responded that his intention was the latter. He accepted that the consequence of so doing was that he would need to file a minute of proposed amended defence to bring a counterclaim.
I find that the pleadings in question:
(a)do not disclose a reasonable defence in that they do not respond to the allegations made in the statement of claim;
(b)further, in light of the first defendant's stated position, are not intended to raise, and in any event do not with clarity raise, a counterclaim;
(c)may prejudice, embarrass or delay the fair trial of the action because they fail to confine the issues or state the case of the first defendant with reasonable particularity, or raise his case in terms which are so general that it cannot be cured by procedural assistance from the court; and
(d)should be struck out.
Paragraphs iii) and iv)
Similarly, in the paragraphs at the end of the Defence numbered iii) and iv), the words objected to are in the nature of submissions about steps that the first defendant says he will take, or are necessary, to defend the action.
As to the whole of those paragraphs, I find that they:
(a)do not disclose a reasonable defence in that they do not respond to the allegations made in the statement of claim; and
(b)may prejudice, embarrass or delay the fair trial of the action because they raise immaterial or irrelevant issues; and
(c)should be struck out.
Paragraph 9.2
The plaintiff's written submissions object that in par 9.2 of the Defence, the first defendant pleads alleged conversations he had with third parties, which is a pleading of evidence rather than of material facts.
I note that this paragraph was not within the scope of the objections in the plaintiff's chamber summons, and that the plaintiff has not identified with particularity in the plaintiff's written submissions the words to be struck out.
Taking account of:
(a)the fact that the first defendant is unrepresented and that, read as a whole, the paragraph responds to the statement of claim;
(b)although the words 'he replied "Kingsley told me to do it" which is heavily backed up by evidence' plead evidence, which is not technically proper, they can be understood by the plaintiff as an assertion of fact (that the plaintiff authorised certain acts) and so the plaintiff is in a position to know and meet that case; and
(c)if, ultimately, supporting evidence is not also led, then it is open to the trial judge to make a factual finding that is contrary to the pleaded words,
the paragraph should not be struck out.
Paragraph 18
The plaintiff objects to the whole of par 18 of the Defence on the ground that it does not respond to the corresponding allegation in the statement of claim.
Broadly, the allegation in the statement of claim concerns the transfer of a sum of money to the first defendant. The first defendant's pleading is in terms that:
The First Defendant and the Second Defendant deny why any such transfer should have been made by the Plaintiff as there was no agreement to do so.
The first defendant has not addressed whether in fact the alleged transfer occurred as alleged or at all, or has done so in such ambiguous terms that it cannot be understood. The pleading in the statement of claim is not complex, and the first defendant is in a reasonable position to respond to the allegations directly.
I find that par 18 of the Defence:
(a)does not disclose a reasonable defence in that it does not respond to the allegations made in the statement of claim;
(b)further and alternatively may prejudice, embarrass or delay the fair trial of the action because it is ambiguous, and fails to confine the issues or state the case of the first defendant with reasonable particularity; and
(c)should be struck out.
Paragraph 19
The plaintiff makes a similar objection to par 19 of the Defence, on the grounds that it does not 'specifically deny or admit the allegations' in the statement of claim.
The relevant allegations are to the effect that a vehicle engine overheated because it was severely damaged, to which the first defendant pleads:
The First Defendant and Second Defendant cannot know this, neither is a mechanic.
That pleading can, in my view, be understood as being to the effect that the defendants do not admit the allegations. So understood, and insofar as it applies to the first defendant, it is a proper pleading and should not be struck out.
Remaining paragraphs
Finally, by reason of the prohibition under O 12 r 1(2) RSC (discussed earlier in these reasons), I also consider it appropriate (in the exercise of the court's inherent power) to strike out such parts of the first defendant's Defence that purport to represent the pleadings as being those of the second defendant. That may be achieved by striking out the first instance of the phrase 'and the Second Defendant' in each remaining paragraphs of the Defence.
Costs
Having delivered the reasons above, and having heard the parties as to costs, I consider it appropriate that the defendants should bear the plaintiff's costs of the application.
Orders
1.Insofar as an appearance filed on 7 April 2022 purports to be the appearance of the second defendant, it is rejected and uplifted.
2.Insofar as the defence filed on 5 April 2022, and amended on 28 April 2022 and 13 June 2022, purports to be the defence of the second defendant, it is rejected and uplifted.
3.The second defendant has leave to enter an appearance, in accordance with O 12 r 1(2) of the Rules of the Supreme Court 1971 (WA), by no later than 28 September 2022.
4.The following parts of the first defendant's amended defence filed on 13 June 2022, are struck out:
(a)in paragraph 8 / 8.1 / 8.2, the words following 'deny this';
(b)in paragraph 11/11.1/11.2, the words from and including the heading 'Particulars';
(c)in paragraph 16, the words following 'deny this';
(d)in paragraph 21/21.1/9.2 [sic], the words from and including the heading 'Particulars';
(e)the whole of paragraph 18;
(f)the whole of the paragraphs numbered iii) and iv); and
(g)in each and every paragraph, the first instance of the phrase 'and the Second Defendant'.
5.The defendants pay the plaintiff's costs of the application to be taxed or agreed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
MB
Associate to Registrar
9 SEPTEMBER 2022
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