Kostov v Zhang; Kostov v Fairfax Media Publications Pty Ltd (No. 2)

[2017] NSWDC 18

District Court

New South Wales

Medium Neutral Citation:	Kostov v Zhang; Kostov v Fairfax Media Publications Pty Ltd (No. 2) [2017] NSWDC 18
Hearing dates:	16 February 2017
Date of orders:	16 February 2017
Decision date:	16 February 2017
Jurisdiction:	Civil
Before:	Gibson DCJ
Decision:	(1) The plaintiff’s notice of motion filed 2 February 2017 dismissed. (2) Plaintiff is to pay the defendants’ costs of the notice of motion, including the costs of preparation and appearances today in relation to both matters, on an indemnity basis. (3) The plaintiff’s oral application for any judgment to be “suppressed’ (i.e. not published on CaseLaw) is refused.
Catchwords:	PRACTICE AND PROCEDURE – plaintiff leaves court during hearing – application under UCPR r 36.15(1) to set aside orders as against good faith and under r 36.16(2)(b) and (3) on the basis that she was not physically present in court – application for suppression of judgments under Court Suppression and Non-Publication Orders Act 2010 (NSW) - application dismissed – order for costs to be paid on an indemnity basis – no issue of principle
Legislation Cited:	Civil Procedure Act 2005 (NSW), s 56 Court Suppression and Non-Publication Orders Act 2010 (NSW) Uniform Civil Procedure Rules 2005 (NSW), rr 36.15 and 36.16
Cases Cited:	Aquaqueen International Pty Ltd v Weber [2014] NSWCA 101 Coren v Master Builders Association of New South Wales Pty Ltd [2012] NSWCA 244 John Fairfax Publications Pty Ltd v District Court of New South Wales (2004) 61 NSWLR 344 Jones v Trad (No 2) [2013] NSWCA 415 Kendell v Carnegie (2006) 68 NSWLR 193 Kostov v Zhang; Kostov v Fairfax Media Publications Pty Ltd [2017] NSWDC 7 Kostov v YPOL Pty Ltd [2016] NSWSC 961 Kostov v YPOL Pty Ltd (Supreme Court of New South Wales, Rothman J, 25 August 2016, unreported) Kostov v YPOL Pty Ltd [2017] NSWSC 39 Northey v Bega Shire Valley Council [2012] NSWCA 28 Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 47 Rinehart v Welker [2011] NSWCA 425 Rinehart v Welker [2012] NSWCA 1 Weber v Aquaqueen International Pty Ltd [2013] NSWSC 1181
Category:	Procedural and other rulings
Parties:	In proceedings 2016/51926: Plaintiff: Adriana Kostov First Defendant: Fan Fan Zhang Second Defendant: Fairfax Media Publications Pty Ltd Third Defendant: EasyMarkets Pty Ltd   In proceedings 2016/86450: Plaintiff: Adriana Kostov Defendant: Fairfax Media Publications Pty Ltd
Representation:	Counsel: Plaintiff: In person First and third defendants in proceedings 2016/51926: Mr A T S Dawson SC / Mr A R R Vincent Second defendant in 2016/51926 and defendant in 2016/86450: Ms L Norman (solicitor)   Solicitors: Plaintiff: In person First and third defendants in proceedings 2016/51926: HWL Ebsworth Second defendant in 2016/51926 and defendant in 2016/86450: Banki Haddock Fiora
File Number(s):	2016/51926; 2016/86450
Publication restriction:	None

Judgment

The application before the court

1. These are proceedings for defamation and injurious falsehood arising out of the publication, in the Australian Financial Reviewdated 10 February 2016, of an article entitled “Bad boy behaviour the job of companies to change”. The plaintiff’s unsatisfactory conduct of this litigation since that time resulted in my making the orders set in my judgment of 2 February 2017: Kostov v Zhang; Kostov v Fairfax Media Publications Pty Ltd [2017] NSWDC 7.

2. The plaintiff participated only briefly in the hearing which resulted in those orders, first by telephone link and, after being advised that her application for an adjournment was refused, by a brief appearance in the courtroom. Despite my asking her to stay so that she could help me to understand what her case was, she declined to remain and the hearing concluded in her absence.

3. The plaintiff filed a Notice of Motion later that same afternoon (2 February 2017), seeking orders under rr 36.15(1), 36.16(2)(b) and 36.16(3) Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) and “in the interests of procedural fairness under the Civil Procedure Act”. She sought the setting aside the orders made earlier that day. and orders for the proceedings to be stayed pending the outcome of her application for special leave before the High Court.

4. The plaintiff’s application before me today was for a rehearing of the defendants’ notices of motion and for her earlier application for a stay pending the special leave application. Although she asserted that this amounted to a rehearing of the defendants’ applications, in practical terms she was asking me to make the orders she had been seeking on 2 February 2017 (namely a stay pending the High Court application).

5. The plaintiff relies upon an affidavit sworn 2 February 2017, in which she acknowledges that she was in court “for approximately 15 minutes” but asserts that she “felt very unwell, and overwhelmed” (paragraph 6) by the presence of the first and third defendants’ solicitors and was unable to remain. She asks for the orders to be set aside because she was absent for “the majority of the hearing” (paragraph 7). She also states that the best course would be for a stay pending “the determination of the High Court Appeal in relation to other matters, the High Court Appeal itself addressing costs” (paragraph 10).

6. Ms Kostov addressed the court at some length. She stated that, in addition to being required to appear for a client on a mention in the Local Court, she had to attend the Supreme Court to object to production of documents under subpoena in a case where she was the plaintiff (the history of these events is set out in Kostov v YPOL Pty Ltd [2017] NSWSC 39). I agree that this involved the plaintiff in an application she brought on the afternoon of 2 February 2017, but she does not suggest that she was in the Supreme Court between 9:00am and 10:00am on 2 February 2017, when the defendants’ applications were set down for hearing.

The relevant principles

7. The plaintiff brings her application in two alternative ways. First, pursuant to rr 36.15(1) and 36.16, she complains of lack of procedural fairness as she did not have a chance to put her case and materials before the court and that the orders made were unfair. Second, under r 36.16(2)(b) or r 36.16(3), she says that she was, to quote her oral submissions, “not technically there” for the hearing because she left before the hearing was over.

8. UCPR r 36.15(1) provides:

“36.15 General power to set aside judgment or order

(1) A judgment or order of the court in any proceedings may, on sufficient cause being shown, be set aside by order of the court if the judgment was given or entered, or the order was made, irregularly, illegally or against good faith.

(2) A judgment or order of the court in any proceedings may be set aside by order of the court if the parties to the proceedings consent.”

9. The basis upon which the orders are asserted to have been made without good faith (paragraph 8 of the plaintiff’s affidavit) are that they were made without any regard for her financial position and that “I cannot be expected to live with being accused of condoning sexual harassment and putting back the cause for women” (paragraph 9). She submits that every plaintiff has a right to be heard, particularly where they are “the aggrieved party” (paragraph 9).

10. The phrase “against good faith” relates to the circumstances in which the judgment was given, and is “an expression which requires the impeachment of the intention or behaviour of the person whose good faith is impugned” (Kendell v Carnegie (2006) 68 NSWLR 193 at [60]). There is no evidence here of any mistakes or misapprehensions of the kind identified in those proceedings (which I note were insufficient, in any event, for there to be any finding that the judgment in those proceedings should have been set aside as being against good faith).

11. In addition, the plaintiff had the opportunity of my stopping Mr Dawson SC’s submissions when she came into court so that she could look at the exhibits and assist me in understanding her claim. Instead, she told me that everything was in the submissions and affidavit she had sent earlier that morning, and left the court. That would not warrant a finding the orders I subsequently made were against good faith, for the reasons explained by Basten JA in Coren v Master Builders Association of New South Wales Pty Ltd [2012] NSWCA 244. The plaintiff chose to absent herself from the court without reasonable excuse and should not be permitted to revisit the orders made in her absence in such circumstances: Weber v Aquaqueen International Pty Ltd [2013] NSWSC 1181; Aquaqueen International Pty Ltd v Weber [2014] NSWCA 101.

12. I dismiss the application under UCPR r 36.15(1).

13. This brings me to a consideration of the plaintiff’s asserted absence from the court. UCPR r 36.16 provides:

“36.16 Further power to set aside or vary judgment or order

(1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order.

(2) The court may set aside or vary a judgment or order after it has been entered if:

(a) it is a default judgment (other than a default judgment given in open court), or

(b) it has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order, or

(c) in the case of proceedings for possession of land, it has been given or made in the absence of a person whom the court has ordered to be added as a defendant, whether or not the absent person had notice of the relevant hearing or of the application for the judgment or order.

(3) In addition to its powers under subrules (1) and (2), the court may set aside or vary any judgment or order except so far as it:

(a) determines any claim for relief, or determines any question (whether of fact or law or both) arising on any claim for relief, or

(b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief.

(3A) If notice of motion for the setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may determine the matter, and (if appropriate) set aside or vary the judgment or order under subrule (1), as if the judgment or order had not been entered.

(3B) Within 14 days after a judgment or order is entered, the court may of its own motion set aside or vary the judgment or order as if the judgment or order had not been entered.

(3C) Despite rule 1.12, the court may not extend the time limited by subrule (3A) or (3B).

(4) Nothing in this rule affects any other power of the court to set aside or vary a judgment or order.”

14. The orders were not made in the plaintiff’s absence. As noted above, and in my earlier judgment, she was heard on her application for adjournment and told (by telephone) that this application was refused. She then came to court but, despite my request for her to remain in the court room so that she could assist me in understanding her evidence and submissions, she refused to do so. As Ms Norman pointed out in her oral submissions, the plaintiff told me she had put everything in her written submissions and affidavits, and she has nothing to add. That does not amount to being absent from the court: Northey v Bega Shire Valley Council [2012] NSWCA 28.

15. As set out in paragraph [17] of my judgment, the plaintiff agreed to the proposed hearing date. Whether or not she was in another court mentioning a matter for another client in the Downing Centre, or wanted to attend the Supreme Court in the afternoon in other proceedings, these are not reasons for her to fail to attend court for a hearing specially fixed outside court hours (9 – 10 am) some months beforehand. Even if the times had conflicted, this court routinely accommodates legal practitioners who have matters before judges or magistrates in other courts, as the plaintiff would be well aware.

16. The plaintiff’s applications under UCPR r 36.16(2)(b) and 36.16(3) are dismissed.

The plaintiff’s address for service

17. Another matter of concern is that the address for service given by the plaintiff on her notice of motion is the address which she has conceded is an old address for her former employer. As noted in my previous judgment, an employee of the current occupant has deposed to the plaintiff’s former employer not being at that address for at least two and a half years.

18. The plaintiff volunteered to the court that she could provide an address to which material, including notifications from the court, could be sent, such as the address of a solicitor or barrister, and suggested that such notices could be sent to Mr Dawson SC. As Mr Dawson SC is counsel for the first and third defendants, that is entirely inappropriate. When I asked her to give an address at which she could be located, she stated that she was looking for accommodation and added that “I don’t have a proper address.”

19. All litigants in this court must provide a bona fide address for service. I have put the plaintiff on notice that if she brings further applications without providing a proper address for service, she runs the risk that the court may refuse to hear them.

Application under Court Suppression and Non-Publication Orders Act2010 (NSW)

20. After I had made my orders, the plaintiff sought an order for the suppression of my judgment of 2 February 2017 and the judgment which set out the reasons for my orders on the basis that the judgment currently online as well as this judgment either contained or would contain information about her that was unfair and untruthful. The plaintiff did not identify the material which she claims to be wrong or unfair beyond a general assertion that statements adverse to her credit have been made.

21. The primacy of open justice is fundamental to the rule of law in Australia: Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 47; John Fairfax Publications Pty Ltd v District Court of New South Wales (2004) 61 NSWLR 344 at 354–357 at [29]–[41]. There are no special rules for defamation proceedings (Jones v Trad (No 2) [2013] NSWCA 415); in fact, the vindication of reputation requires open justice. Nor is it sufficient for a party to complain that potentially embarrassing information may be disclosed (Rinehart v Welker [2011] NSWCA 425; Rinehart v Welker [2012] NSWCA 1). A non-publication order should not be made unless it is really necessary to secure the proper administration of justice in the particular proceedings. That is not the case here, and the plaintiff’s application has accordingly been refused.

Costs

22. The defendants seek orders for costs on an indemnity basis, submitting that the plaintiff, a legal practitioner, must have known that the application was doomed to fail and that she would similarly have been aware that the proper court for her application was the Court of Appeal: Coren v Master Builders Association of New South Wales Pty Ltd. The plaintiff would have been aware of the hopelessness of her application because an indemnity costs order was made against the plaintiff by Rothman J in Kostov v YPOL Pty Ltd (Supreme Court of New South Wales, Rothman J, 25 August 2016, unreported) in relation to a similar application to set aside the orders made by Harrison J Kostov v YPOL Pty Ltd [2016] NSWSC 961 set aside. The defendants also point to the failure of the plaintiff in these proceedings to comply with her duty pursuant to s 56 Civil Procedure Act 2005 (NSW).

23. Indemnity costs orders should not be used as a punishment, and correspondingly are awarded only in egregious cases. However, I am satisfied, having regard to the above factors, that this is one of those occasions.

Orders

1. The plaintiff’s notice of motion filed 2 February 2017 dismissed.

2. Plaintiff is to pay the defendants’ costs of the notice of motion, including the costs of preparation and appearances today in relation to both matters, on an indemnity basis.

3. The plaintiff’s oral application for any judgment to be “suppressed’ (i.e. not published on CaseLaw) is refused.

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