Kowalski v Complete Exhaust Specalists Marion & Anor (No.2)
[2010] FMCA 636
•24 August 2010
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| KOWALSKI v COMPLETE EXHAUST SPECALISTS MARION & ANOR (No.2) | [2010] FMCA 636 |
| TRADE PRACTICES – Summary dismissal of application – for want of jurisdiction – fresh application based on different jurisdictional basis – whether applicant estopped – whether an abuse of process of the Court. |
| Trade Practices Act 1974 (Cth), ss.4, 6, 52 and 53 Fair Trading Act 1987 (SA), ss.56, 57 and 58 Federal Magistrates Rules 2001, r.13.10 Federal Magistrate Act 1999, s.17A |
| Kowalski v Complete Exhaust Specialist Marion & Anor [2010] FMCA 238 Kowalski v Complete Exhaust Specialists Marion [2010] FCA 412 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117 Sea Culture International v Scoles (1991) 32 FCR 275 Hill v Lang [2010] FCA 629 |
| Applicant: | KAZIMIR KOWALSKI |
| First Respondent: | COMPLETE EXHAUST SPECALISTS MARION |
| Second Respondent: | BOB STRAWBRIDGE |
| File Number: | ADG 150 of 2010 |
| Judgment of: | Lindsay FM |
| Hearing date: | 16 August 2010 |
| Date of Last Submission: | 24 August 2010 |
| Delivered at: | Adelaide |
| Delivered on: | 24 August 2010 |
REPRESENTATION
| the Applicant: | In Person |
| First and Second Respondents: | No appearance |
ORDERS
The application filed on 11 June 2010 is summarily dismissed pursuant to Rule 13.10(c) of the Federal Magistrates Court Rules 2001.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE |
ADG 150 of 2010
| KAZIMIR KOWALSKI |
Applicant
And
| COMPLETE EXHAUST SPECIALISTS MARION |
First Respondent
| BOB STRAWBRIDGE |
Second Respondent
REASONS FOR JUDGMENT
I have before me an application by Mr Kowalski in which he seeks orders pursuant to s.52 and s.53 of the Trade Practices Act 1974 (Cth) and s.56, s.57 and s.58 of the Fair Trading Act 1987 (SA) against the respondents. The first respondent is in fact simply a business name. The second and third respondents are a married couple who carry out the business of Complete Exhaust Specialists in partnership.
The applicant says that the respondents engaged in misleading and deceptive conduct in that they replaced the muffler on his Ford motor vehicle when they did not need to do so, following their communicating their opinion to him that a problem with his muffler was the cause of a knocking noise in his motor vehicle.
The application says that the relevant conduct occurred on 25 and 26 August 2009.
This is the second action brought by Mr Kowalski in respect of these events.
In Kowalski v Complete Exhaust Specialist Marion & Anor [2010] FMCA 238 I summarily dismissed Mr Kowalski’s claim pursuant to Rule 13.10 of the Federal Magistrates Rules 2001.
My decision was the subject of an Appeal to the Federal Court of Australia. Mansfield J dismissed the Appeal (see Kowalski v Complete Exhaust Specialists Marion [2010] FCA 412).
I summarily dismissed the claim because none of the respondents were a corporation and Mr Kowalski’s attempt to engage the accrued jurisdiction of the Court in promoting an application for orders under the Fair Trading Act 1987 (SA) was also refused.
The present application has not been served. I considered it appropriate to satisfy myself that the proceeding was properly instituted before authorising the service of the proceedings upon the respondents.
These proceedings are different in one respect from the proceedings that have already been dismissed in that Mr Kowalski in his application has pleaded a specific reliance upon s.6(3) of the Trade Practices Act 1974 (Cth).
That section provides;
(3) In addition to the effect that this Act, other than Parts IIIA, VIIA and X, has as provided by another subsection of this section, the provisions of Part IVA, of Divisions 1, 1AAA, 1AA and 1A of Part V and of Divisions 2 and 3 of Part VC have, by force of this subsection, the effect they would have if:
(a)those provisions (other than sections 55 and 75AZH) were, by express provision, confined in their operation to engaging in conduct to the extent to which the conduct involves the use of postal, telegraphic or telephone services or takes place in a radio or television broadcast; and
(b)a reference in those provisions to a corporation included a reference to a person not being a corporation.
The effect of the amendment is to ground the jurisdiction of the Court to determine the matter notwithstanding the fact that the respondents are not corporations, under a different sub-placitum of paragraph 51 of the Constitution of the Commonwealth of Australia, namely the postal and telegraphic communication power.
The application itself alleges that on 25 August 2009 the third respondent spoke with the applicant’s wife and informed her that the muffler had been replaced on the applicant’s motor vehicle because it was the cause of the knocking noise about which the applicant complained. It is not alleged that such representation was made during a telephone call.
However it is alleged in the application that on the following day, 26 August 2009, during a telephone conversation with the applicant the third respondent advised him that the muffler was replaced because it was the cause of the noise.
Mr Kowalski complains that the knocking noise continued after the replacement of the muffler and therefore the respondents had engaged in misleading and deceptive conduct in replacing it for the allegedly false reasons they provided him.
The actual replacement of the muffler occurred on 25 August 2009. So much is plain from paragraph 1.1 of this application and from an affidavit sworn by the applicant and filed by the applicant in the earlier proceedings.
In the earlier proceedings Mr Kowalski was put upon notice of the Court’s concerns as to the jurisdictional difficulties associated with his claim and the matter was adjourned to enable him to prepare his responsive arguments. This generated the amendment to the claim which sought to engage (unsuccessfully) the accrued jurisdiction of the Court. The telephone discussions of 26 August 2009 are not referred to in the first application or in the affidavit filed in support of that application. The first application was confined to conduct which was said to have occurred on the day that the muffler was replaced, namely 25 August 2009.
In hearing this application, the Court on 12 July 2010 raised with Mr Kowalski its concerns about his attempting to reinstate an action that has already been dismissed. Specifically, he was given the opportunity to address the Court as to whether or not this claim was met by the doctrine of res judicata or estopped on account of issue estoppel or Anshun estoppel. The doctrine of res judicata and of issue estoppelis discussed by the High Court in Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 (see the joint judgment of Gibbs CJ, Mason J and Aickin J at [597]). Neither doctrine applies in the context of this matter because, as Mr Kowalski pointed out in his written submission, the order dismissing the first application was not made at the conclusion of a trial on the merits of the case but following upon a summary dismissal arising from a lack of jurisdiction. In that same decision, the High Court described a third form by estoppel in which a litigant is prevented from relying upon a matter which he had unreasonably refrained from raising as an issue in an earlier action in circumstances where it could be reasonably expected that such issue would have been raised. Again, the circumstance of there being no opportunity for Mr Kowalski (because of the jurisdictional problem) to have agitated any factual issues in the earlier proceeding means that such doctrine – so called “Anshun estoppel” – has no applicability to the circumstances of this case.
There is no doubt that a judgment constituted of a dismissal of a claim on a summary basis is an interlocutory judgment. So much is clear from the detailed discussion of the authorities in relation to the topic carried out by the Full Court of the Federal Court in Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117 at [32] – [44]. Mr Kowalski was at pains to make that submission, which I accept. Interlocutory determinations will not give rise to the application of any of the equitable doctrines described in the preceding paragraph.
Section 17A of the Federal Magistrate Act 1999 provides;
(1)The Federal Magistrates Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a)the first party is prosecuting the proceeding or that part of the proceeding; and
(b)the Court is satisfied that the other party has no reasonable prospect of successfully defending the proceeding or that part of the proceeding.
(2)The Federal Magistrates Court may give judgment for one party against another in relation to the whole or any part of the a proceeding if:
(a)the first party is defending the proceeding or that part of the proceeding; and
(b)the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.
(3)For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:
(a)hopeless; or
(b) bound to fail;
for it to have no reasonable prospect of success.
(4)This section does not limit any powers that the Federal Magistrates Court has apart from this section.
That section is reflected in Rule 13.10 of the Federal Magistrates Court Rules 2001;
The Court may order that a proceeding by stayed, or dismissed generally or in relation to any claim for relief in the proceeding, if the Court is satisfied that:
(a)the party prosecuting the proceeding or claim for relief has no reasonable prospect of successfully prosecuting the proceeding or claim; or
(b)the proceeding or claim for relief is frivolous or vexatious; or
(c)the proceeding or claim for relief is an abuse of the process of the Court.
I have given Mr Kowalski an opportunity to respond specifically to the Court’s concerns as to whether this application should be summarily dismissed as constituting an abuse of the process of the Court. He provided a submission in writing on 23 August 2010 and made further oral submissions.
The circumstance that the claim now brought by Mr Kowalski is identical to that previously brought by him save for the reliance upon s.6(3) of the Trade Practices Act 1974 - in terms of cause of action, parties and relief sought - must give rise to consideration of the issue as to whether this claim is an abuse of the process of the Court. The claim as promoted in the first application was missing any reference to telephone conversations on 26 August 2009 and the possibility arises that these have been introduced to give rise to an opportunity to engage the enlarged jurisdiction provided by that section.
Essentially, Mr Kowalski’s complaint is that a muffler was replaced on his motor vehicle by the respondents when it ought not to have been and that this amounts to misleading or deceptive conduct. That remains the essential complaint promoted in each application.
In discussing the power of the Federal Court under its Rules to stay or dismiss a proceeding when it appears to the Court it is an abuse of its process French J (as he then was) had this to say in Sea Culture International v Scoles (1991) 32 FCR 275 at [279]:
The possible varieties of abuse of process are only limited by human ingenuity and the categories are not closed. An unmeritorious claim brought merely in order to put pressure on a respondent for commercial or other reasons would no doubt be treated as an abuse. Such a claim might also be attacked as frivolous or vexatious or as disclosing no reasonable cause of action. Those designations are not mutually exclusive. An attempt to litigate in the court a dispute or issue which has been resolved in earlier litigation in this or another court or tribunal may also, according to the circumstances, constitute an abuse of process even if not attracting the doctrines of res judicata or issue estoppel.
Underlying the power that courts have assumed to stay or dismiss proceedings for abuse of process is a policy of preventing waste of judicial resources and their use for purposes unrelated to the determination of genuine disputes…
The transformation Mr Kowalski’s case underwent between the first proceeding and the second proceeding is to be seen by a comparison of the affidavits filed in support of each. I understand that the affidavits are not trial affidavits and that they were filed with their respective applications to give compliance with the relevant Rules of Court. I bear in mind, too, the inappropriateness of exercising the power to summarily determine a claim where factual assertions require clarification or are in dispute. This factor is emphasised by Lander J in Hill v Lang [2010] FCA 629 in the context of factual disputes between parties but is also relevant to adjudicating whether to summarily determine a claim where factual uncertainty arises on a party’s own case.
The affidavit filed in support of the first application focuses, as one would expect, upon the circumstances relating to the installation of the muffler on 25 August 2009. There is a complete absence of any reference to any discussions between the respondents and Mr Kowalski over the telephone on 26 August 2009. There is reference in paragraph 10 of the affidavit to the respondents having misled and deceived Mr Kowalski by telling him and his wife on that day that the muffler needed to be replaced. No reference is made to a telephone conversation on that day. That is consistent with the absence of any reference to a telephone conversation having occurred on that day in the affidavit filed in support of the second application. The focus in the second affidavit is upon misleading and deceptive representations that occurred on 26 August 2009 during a telephone conversation, though both days, 25 and 26 August 2009, are relied upon in a generalised way as days on which the misleading and deceptive conduct occurred.
Mr Kowalski was asked by me to account for the absence of any reference to the telephone conversation of 26 August 2009 in his first application and the affidavit supporting it but was unable to provide me with one.
Nevertheless, this remains a matter that can be possibly clarified in the evidence. The introduction of the telephone call to the second application is something that generates concern as to the possibility of it being introduced solely for the purposes of filling the jurisdictional hole which was identified at the time the first application was dismissed. On its own, however, this circumstance is not sufficient to warrant the use of the summary judgment powers which I regard as required to be exercised sparingly and in only the most clear case.
There are other matters, however. Section 6(3) of the Trade Practices Act 1974 refers to conduct which “involves the use” of telephonic services. The only use of telephonic service alleged in this case occurs after the muffler has been installed.
Paragraph 1.1 of the application clearly identifies that the respondents had already represented on 25 August 2009 in non-telephone communications the fact that the muffler needed to be replaced (and had been replaced) because it was the cause of the knocking noise when Mr Kowalski started his car. In that context, representations made over the telephone following upon Mr Kowalski’s reliance upon the original representations might be thought to add very little of substance or relevance to his case. The conduct which is the gravaman of his claim is the representation that the muffler needed to be replaced as it was the cause of the noise problem with the car and Mr Kowalski then relying upon that representation and authorising, expressly or implicitly, the installation of a new muffler. It is difficult to perceive any meaningful connection between the conduct said to be impugned by s.52 and s.53 of the Trade Practices Act 1974 and the use of telephonic services on the day following the fitting of the muffler.
Additionally, it will be recalled that Mr Kowalski was given the opportunity prior to the summary dismissal of the first application to consider the jurisdictional question. Having considered it he sought to rely upon the accrued jurisdiction of the Court. He did not seek to rely upon the extended jurisdiction provided by s.6(3) of the Trade Practices Act 1974. The respondents were entitled to have Mr Kowalski disclose during his response to the application to summarily determine that claim, all of the jurisdictional matters upon which he relied. Having had his claim dismissed because he unsuccessfully relied upon the accrued jurisdiction it does not seem to me to be fair or just to the respondents to expect them to have to respond to a claim now grounded on an entirely different jurisdictional basis. It is reasonable for the respondents and the Court to expect that Mr Kowalski should have played all of his jurisdictional cards at the one time unless there was some matter explaining why he did not. I asked him to provide me with such explanation and he was unable to do so.
It is the combination of his reliance upon a wholly new factual episode, and the highly tenuous link between the conduct said to give rise to his claim and the telephonic communications of 26 August 2009, taken together with his failure to raise these matters said to ground the jurisdiction when he promoted his first claim that persuades me that it would be an abuse of the process of the Court to enable this application to proceed.
A respondent should not be required to meet a case (the alleged jurisdictional basis of which has changed) when no explanation for the failure to promote the facts and jurisdictional contentions which are now being promoted at the time of the earlier application is provided.
Accordingly, the application is summarily dismissed pursuant to Rule 13.10(c) of the Federal Magistrates Court Rules 2001.
I certify that the preceding thirty-four (34) paragraphs are a true copy of the reasons for judgment of Lindsay FM
Associate:
Date: 24 August 2010
5
4