JAHAD v Equitable Financial Solutions Pty Ltd - [2020] FCCA 2551

FEDERAL CIRCUIT COURT OF AUSTRALIA

JAHAD v EQUITABLE FINANCIAL SOLUTIONS PTY LTD & ANOR

[2020] FCCA 2551

Catchwords:
CONSUMER LAW – Costs – Where first respondent intends to conduct business of raising funds in relation to a Shariah-compliant investments program – where first respondent accepts appointment by applicant as its Wakeel agent to invest its funds and to repay principle and profit in consideration for agency fee – where first respondent accepts investment by applicant – where investments are not fully repaid – where condition of first respondent’s investment license was that it would participate in dispute resolution scheme conducted by Credit and Investments Ombudsman – where Ombudsman makes determination that first respondent repay investment – where first respondent does not repay monies – where proceedings ensued – proceeding allocated to Consumer Protection List – where first respondent placed in administration – where second respondent overseas and does not provide instructions when matter listed for directions – costs ordered – where proceeding set down for hearing – jurisdiction put in issue – applicant discontinues proceeding – second respondent seeks costs on indemnity or party/party basis – applicable principles – discretionary considerations – relevance of conduct – orders made – Registrar directed to supply copy of reasons for judgment to Australian Securities & Investments commission.

Legislation:

Corporations Act 2001 (Cth), s 131A

Federal Circuit Court of Australia Act 1999 (Cth), ss 3, 21, 42, 43, 79

Federal Circuit Court Rules 2001 (Cth), rr 13.01, 21.02

Cases cited:

Ahmed v Minister for Immigration and Multicultural Affairs [2000] FCA 1436

Alrjoob v Minister for Home Affairs[2018] FCA 1144
AOJ15 v Minister for Immigration and Border Protection [2017] FCA 675
BEL17 v Minister for Immigration and Border Protection [2020] FCA 1045

Covell Matthews & Partners v French Wools Ltd [1977] 1 WLR 876
Hobson v BWL Pty Ltd (No 3) [2012] FMCA 439
Ingui v Ostara [2003] FMCA 132
JT Stratford & Son Pty Ltd v Lindley (No 2) (1969) 1 WLR 1547

Kaur v Minister For Immigration, Citizenship, Migrant Services and Multicultural Affairs (Costs), [2020] FCA 1247

MZZKH v Minister for Immigration and Border Protection [2013] FCCA 2287
O’Neill v Mann [2000] FCA 1680

Re Minister for Immigration & Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622
Yates Property Corporation Pty Ltd v Boland [2000] FCA 1106
Zaghoul v Jewellery & Gift Buying Service Pty Ltd [2020] FCA 1045

Applicant:

AMINA JAHAD

First Respondent:

EQUITABLE FINANCIAL SOLUTIONS PTY LTD "EFSOL"

Second Respondent:

USMAN SIDDIQUI

File Number:

MLG 2906 of 2019

Judgment of:

Judge A Kelly

Hearing date:

16 March 2020

Date of Last Submission:

24 March 2020

Delivered at:

Melbourne

Delivered on:

14 September 2020

REPRESENTATION

Counsel for the Applicant:

Mr F.C. Brimfield

Solicitors for the Applicant:

Mykyta Lawyers

Counsel for the Respondents:

Ms M. Harris

Solicitors for the Respondents:

Cordoba Lawyers

ORDERS

The application to set aside the order for costs made on 12 November 2019 against the second respondent, Usman Siddiqui, be dismissed.
The second respondent’s…

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: [2020] FCCA 2551
Decision Date: 14 September 2020

CaseChat Overview and Summary

The applicant, JAHAD, commenced proceedings against the first respondent, Equitable Financial Solutions Pty Ltd, and the second respondent, Usman Siddiqui. The dispute arose from an investment program where the first respondent, acting as a Wakeel agent, accepted funds from the applicant for Shariah-compliant investments. The investments were not fully repaid, and despite a determination by the Credit and Investments Ombudsman requiring repayment, the first respondent failed to do so. The proceedings were allocated to the Consumer Protection List. The first respondent was subsequently placed in administration, and the second respondent, who was overseas and uncontactable, did not provide instructions. The applicant later discontinued the proceeding, and the second respondent sought costs on an indemnity or party/party basis. The matter came before Judge A Kelly.

The court was required to determine whether to set aside a prior costs order made against the second respondent and whether to grant the second respondent's applications for costs on an indemnity or party/party basis. The court also considered the applicable principles for awarding costs, including discretionary considerations and the relevance of the parties' conduct.

Judge A Kelly dismissed the application to set aside the order for costs made against the second respondent on 12 November 2019. The court also dismissed the second respondent's applications for costs on an indemnity or party/party basis. The reasoning for these decisions is not detailed in the provided text, but the court directed that the Registrar furnish a copy of the reasons for judgment to the Australian Securities and Investments Commission.

Orders

Orders of the court

ORDERS

1. The application to set aside the order for costs made on 12 November 2019 against the second respondent, Usman Siddiqui, be dismissed.

2. The second respondent’s applications for the costs of this proceeding on an indemnity, alternatively a party/party, basis be dismissed.

3. Direct that the Registrar of the Court furnish a copy of these reasons for judgment to the Australian Securities & Investment Commission.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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