Horizons (Asia) Pty Ltd v Enagic Co., Ltd

[2022] FCA 465

FEDERAL COURT OF AUSTRALIA

Horizons (Asia) Pty Ltd v Enagic Co., Ltd [2022] FCA 465  

File number(s):

NSD 1331 of 2021

Judgment of:

YATES J

Date of judgment:

28 April 2022

Catchwords:

PRACTICE AND PROCEDURE – interlocutory application seeking dismissal of application for leave to appeal – where applicant failed to comply with court orders – where procedural delays by applicant in progressing its application for leave to appeal – where applicant failed to provide security as ordered – application for leave to appeal dismissed

Legislation:

Federal Court of Australia Act 1976 (Cth) ss 37N, 56(4) Trade Marks Act 1995 (Cth) s 195(2)

Federal Court Rules 2011 (Cth) r 35.32

Division:

General Division

Registry:

New South Wales

National Practice Area:

Intellectual Property

Sub-area:

Trade Marks

Number of paragraphs:

22

Date of hearing:

28 April 2022

Counsel for the Applicant:

The Applicant appeared in person

Counsel for the Respondent:

Mr M Hall SC

Solicitor for the Respondent:

Spruson & Ferguson

ORDERS

NSD 1331 of 2021

BETWEEN:

HORIZONS (ASIA) PTY LTD (ACN 124 967 835)

Applicant

AND:

ENAGIC CO., LTD

Respondent

ORDER MADE BY:	YATES J
DATE OF ORDER:	28 APRIL 2022

THE COURT ORDERS THAT:

1.The application for leave to appeal be dismissed.

2.The applicant pay the respondent’s costs of the respondent’s interlocutory application seeking dismissal of the application for leave to appeal, which are to include the costs of today.

3.The applicant pay the respondent’s costs of the application for leave to appeal.

4.The hearing of the application for leave to appeal listed for 10.15 am on 12 May 2022 be vacated.

5.Order 4 made on 3 December 2021 in proceeding NSD2363/2018, requiring the respondent’s solicitors to hold on trust money that was paid into court by the respondent as security for costs until the application for leave to appeal is heard and determined, be discharged forthwith.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

YATES J:

1. On 20 December 2021, the applicant, Horizons (Asia) Pty Ltd (Horizons), filed an application for leave to appeal from a judgment given, and orders made, by a single Judge of the Court on 2 December 2021.

2. The proceeding before the primary judge was an appeal from a decision of a delegate of the Registrar of Trade Marks in opposition proceedings.  Horizons was the applicant for registration of the trade mark KANGEN in respect of certain Class 35 services.  The opposition had been dismissed by the delegate, but the primary judge allowed the appeal, set aside the delegate’s decision, and ordered that the application for registration be refused.

3. Leave to appeal from the primary judge’s judgment and orders is required by s 195(2) of the Trade Marks Act 1995 (Cth).

4. On 29 March 2022, an order was made that the application for leave to appeal be listed for hearing by a Full Court on 12 May 2022, and that the application be heard immediately prior to, or concurrently with, any appeal.

5. On 29 March 2022, orders were made for the filing and hearing of any application for security for costs of the application for leave to appeal and any appeal.

6. The present respondent, Enagic Co., Ltd (Enagic), filed an application for security for costs and, on 6 April 2022, orders were made that Horizons provide security for Enagic’s costs.  Security was to be provided by the payment into court of the sum of $60,000 on or before 5.00 pm AEST on 12 April 2022.

7. The orders made on 6 April 2022 stipulated that, if security was not provided as ordered, the proceedings be stayed; that Enagic file an application for dismissal of the appeal (the dismissal application); and that the matter be listed before me on 14 April 2022 at 9.30 am to hear the dismissal application.

8. Horizons failed to provide security as ordered, and the dismissal application came before me, as appointed.  The dismissal application was supported by an affidavit made by Khajaque Kortian, sworn 13 April 2022.  Mr Kortian is a legal practitioner and a principal in the firm of lawyers acting for Enagic.  In his affidavit, Mr Kortian deposed to Horizons’ default in providing security.  He also deposed to procedural delays by Horizons in progressing its application for leave to appeal and, in particular, its failure to comply with orders for the filing of Parts A and B of the Appeal Book, and for the filing of its outline of submissions and a chronology of relevant events.

9. On 13 April 2022, my Chambers received an email that had been sent by Mr Kortian at 11.54 am that day.  The email was copied to Horizons’ then lawyers.  Amongst other things, the email referred to the orders made on 6 April 2022, and attached a copy of the dismissal application and a copy of Mr Kortian’s affidavit.  The email noted the time and date for the hearing of the dismissal application.

10. On the same day, my Chambers received an email that had been sent at 2.35 pm by the then lawyers acting for Horizons, attaching a notice of ceasing to act.

11. At 7.49 am on 14 April 2022, an email was sent to my Chambers from Horizons acting through Ms Lee Ng as “authorised officer”.  The email attached a letter dated 13 April 2022 (which is now Exhibit A) seeking an adjournment of the dismissal application until 28 April 2022, on the basis that: 

    (a)the order to provide security was made while Ms Ng was on scheduled leave;

    (b)when Ms Ng returned from leave on 11 April 2022, she informed Horizons’ lawyers that the ordered security, and the security for costs that had been ordered in a “parallel case” involving Enagic (NSD 1313 of 2020), could be paid into court by 27 April 2022;

    (c)Enagic had agreed that the security in the “parallel case” could be paid on 27 April 2022;

    (d)perhaps through miscommunication, Horizons’ lawyers had not informed Enagic that the security ordered to be provided in the present proceeding could be provided by 27 April 2022; and

    (e)Horizons’ then lawyers had only informed Horizons late on 13 April 2022 that they had filed a notice of ceasing to act. As to this asserted fact, I now note that, in fact, Horizons’ then lawyers had given Horizons a notice of intention to cease to act on 31 March 2022 (which is now Exhibit C).

12. Horizons requested the adjournment so that it could “procure and appoint a new lawyer”.

13. When the dismissal application was called at 9.30 am on 14 April 2022, I granted leave to Ms Ng to appear on behalf of Horizons.  Ms Ng appeared remotely, by telephone. 

14. After hearing the parties, I granted the adjournment over Enagic’s opposition.  I did so on the basis that the application for leave to appeal had already been stayed by dint of Order 1(a) made on 6 April 2022 and that, by granting the adjournment, Enagic would not suffer material prejudice.  I made clear that the dismissal application would proceed on 28 April 2022.  I also expressed my expectation that, on that occasion, Horizons would appear with legal representation.  I ordered Horizons to pay the costs of the hearing on 14 April 2022.

15. At 1.57 pm on 27 April 2022, an email was sent by Horizons to my Chambers, attaching various copy documents, including a letter from Horizons.  In that letter, Horizons stated (amongst other things) that it had not been able to obtain legal representation, despite attempts to do so.  Its explanation was that the lawyers it had contacted were “either on holiday during the period of the three consecutive long weekends and/or because of the anticipation of complexities and difficulties to step into the matter within the present constraints and developments”.  

16. The letter also stated that, although arrangements had been put in place for payment of the security to be made on or before 27 April 2022, “unexpected difficulties and delays arose stemming from the holiday period in Australia from 14 April to 26 April”.  The letter stated that Horizons required a further 10 working days to “complete the task”.  The letter did not state what arrangements had been put in place, what the difficulties and delays were, or why they were unexpected.  The fact that there were “difficulties and delays” is surprising given the confident assurance in Horizon’s letter of 13 April 2022 that the required security could be paid into court by 27 April 2022 and given that, as at 14 April 2022, Horizons must have been well aware of the then ensuing public holidays.

17. An application for leave to appeal can be dismissed under r 35.32 of the Federal Court Rules 2011 (Cth) on a number of grounds, including an applicant’s failure to comply with a direction of the Court, and for want of prosecution of the application. Further, s 56(4) of the Federal Court of Australia Act 1976 (Cth) provides that if security is not given in accordance with an order under s 56(1), the Court may order that the proceeding be dismissed.

18. When the hearing of the dismissal application was called at 9.30 am today, I again granted leave to Ms Ng to appear on behalf of Horizons.  Once again, Ms Ng appeared remotely, by telephone.  Ms Ng addressed me on the matters set out in Horizons’ letter of 27 April 2022 (which is now Exhibit D).  In addressing those matters, Ms Ng referred to the delay in providing security for costs and, as I understood her, attributed that delay to something for which those providing finance for the security were responsible.

19. On the material before me, I have no confidence that the required security will be provided, as ordered, should a further period for payment into court be allowed. Further, given the history of this matter, I am not persuaded that the application for leave to appeal has been prosecuted—and have no confidence that it will be prosecuted—by Horizons with the despatch that is consistent with the overarching purpose of facilitating the just resolution of this proceeding as quickly, inexpensively, and efficiently as possible: s 37N of the Federal Court of Australia Act 1976 (Cth). Further, I have no confidence that Horizons will secure legal representation.

20. In these circumstances, I propose to accede to Enagic’s application to dismiss the application for leave to appeal.  If Horizons’ circumstances change, it can make a fresh application for leave to appeal although, should that happen, it will be necessary for it to persuade the Court that time should be extended to enable it to do so. 

21. Horizons is to pay Enagic’s costs of the dismissal application and of the application for leave to appeal.

22. Enagic also seeks to discharge Order 4 that was made on 3 December 2021 in proceeding NSD 2363 of 2018.  This order requires its solicitors to hold on trust money that it had paid into court as security for the costs of that proceeding.  I am persuaded that that order should now be discharged.

I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Yates.

Associate:

Dated:       29 April 2022