Laminar Air Flow Pty Ltd v Vokes Ltd

Case [2021] FCA 296

FEDERAL COURT OF AUSTRALIA

Laminar Air Flow Pty Ltd v Vokes Ltd [2021] FCA 296

File number: NSD 1364 of 2017
Judgment of: STEWART J
Date of judgment: 29 March 2021
Catchwords: PRACTICE & PROCEDURE – application for leave to amend pleadings to join a further respondent – four months to trial – detailed programme leading up to trial – whether trial dates might be imperilled and pre-trial programme disrupted – whether proposed new respondent and an existing respondent are commonly owned – whether they are likely to be commonly represented and share the same defence – procedural rights of the new party once joined – likely prejudice – interests of other litigants before the Court – leave refused  
Legislation:

Administrative Decisions (Judicial Review) Act 1977 (Cth)

Federal Court of Australia Act 1976 (Cth) s 37M

Trade Marks Act 1995 (Cth) s 81
Cases cited:

Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175

Laminar Air Flow Pty Ltd v Registrar of Trade Marks [2017] FCA 1447

Vokes Ltd v Laminar Air Flow Pty Ltd [2018] FCAFC 109
Division: General Division
Registry: New South Wales
National Practice Area: Intellectual Property
Sub-area: Trade Marks
Number of paragraphs: 37
Date of hearing: 26 March 2021
Counsel for the Applicant: W H Wu and M T Keene (written submissions also by M Green)
Solicitor for the Applicant: John Fasha Solicitors
Counsel for the Respondents: I P Horak
Solicitor for the Respondents: Wrays Lawyers Pty Ltd

ORDERS

NSD 1364 of 2017
BETWEEN:

LAMINAR AIR FLOW PTY LTD (ACN 106 677 329)

Applicant
AND:

VOKES LTD (CRN 00671542)

First Respondent

TRANSFORMER FILTRATION SYSTEMS PTY LTD (ACN 119 553 767)

Second Respondent

DOLLINGER FILTRATION LTD

Third Respondent

ORDER MADE BY:

STEWART J

DATE OF ORDER:

29 MARCH 2021

THE COURT ORDERS THAT:

1.The applicant have leave to amend its further amended originating application and its further amended statement of claim limited to the following amendments:

(1)the correction of a date;

(2)the insertion of additional particulars to existing substantive paragraphs; and

(3)the correction of the name of the third respondent,

by filing and serving a second further amended originating application and a second further amended statement of claim on or before 6 April 2021. 

2.The applicant pay any costs thrown away by the amendments.

3.The applicant’s interlocutory application filed on 17 March 2021 is otherwise dismissed with costs.

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


REASONS FOR JUDGMENT

STEWART J:

Introduction

  1. The applicant, Laminar Air Flow Pty Ltd, applies by interlocutory application filed on 17 March 2021 for leave to amend its further amended originating application and further amended statement of claim to add a fourth respondent.  The amendments plead essentially the same causes of action as are already pleaded against the existing respondents against the prospective new respondent.  Some other minor amendments are also sought.

  2. Laminar is the registered owner of two Australian registered trade marks which are referred…

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Details
AGLC
Laminar Air Flow Pty Ltd v Vokes Ltd [2021] FCA 296
Case
[2021] FCA 296
Decision Date

CaseChat Overview and Summary

Laminar Air Flow Pty Ltd sought leave to amend its pleadings to join SPX Aus as a further respondent to a proceeding that had already been ongoing for some time. Four months prior to the scheduled trial, Laminar sought to join SPX Aus, a company that appeared to have been an intermediary in the sale of VOKES branded products between Dollinger and TFS. The case was before the Federal Court. The primary issue before the court was whether Laminar should be granted leave to amend its pleadings to include SPX Aus as a respondent, given the late stage in the proceedings and the potential for disruption to the trial dates and pre-trial programme.

The court considered the adequacy of Laminar's explanation for the delay in seeking to join SPX Aus and whether the joinder was likely to result in the trial dates being imperilled. Laminar argued that SPX Aus and Dollinger were related companies, ultimately controlled by SPX Flow Inc, and that they had two out of three common directors. However, the respondents argued that there were no directors in common between SPX Aus and Dollinger and that SPX Flow Inc had sold its power and energy business to Celeros Flow Technology LLC in March 2020, resulting in the ownership of Dollinger passing from SPX Flow Inc to Celeros. The court found that Laminar had not provided a satisfactory explanation for the delay and that the joinder of SPX Aus was likely to result in the trial dates being imperilled. The court also found that the interests of other litigants before the Court would be prejudiced if the trial dates were vacated.

The court dismissed Laminar’s application for leave to amend its pleadings to join SPX Aus as a further respondent. However, Laminar was granted leave to make certain limited amendments to its pleadings, including the correction of a date, the insertion of additional particulars to existing substantive paragraphs, and the correction of the name of the third respondent. Laminar was also ordered to bear the costs of the application.

In summary, the court denied Laminar's application to join SPX Aus as a further respondent due to the late stage in the proceedings and the potential for disruption to the trial dates and pre-trial programme. The court granted Laminar leave to make certain limited amendments to its pleadings and ordered Laminar to bear the costs of the application.

Orders

Orders of the court

1. The applicant have leave to amend its further amended originating application and its further amended statement of claim limited to the following amendments:

(1) the correction of a date;

(2) the insertion of additional particulars to existing substantive paragraphs; and

(3) the correction of the name of the third respondent,

by filing and serving a second further amended originating application and a second further amended statement of claim on or before 6 April 2021.

2. The applicant pay any costs thrown away by the amendments.

3. The applicant’s interlocutory application filed on 17 March 2021 is otherwise dismissed with costs.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

Particularly significant in the present case is the adequacy or otherwise of Laminar’s explanation for seeking to join SPX Aus only now, some four months before trial, and whether or not the joinder of SPX Aus is liable to result in the trial dates being imperilled.The evidence Laminar relies on the affidavit of its solicitor, John Fasha, who, relevantly, stated the following:(1)On the basis of documentary evidence referred to by Mr Fasha, it would appear that SPX Aus and Dollinger are related companies, ultimately controlled by SPX Flow Inc and have two out of three common directors. For reasons that will become apparent, it is not necessary to go into the documentary evidence referred to by Mr Fasha.(2)Three documents produced by Dollinger on 21 January 2021 show sales of VOKES branded products by Dollinger to Australian customers in the period 2011 to 2014, and sales by Dollinger in 2013 of VOKES branded products to SPX Aus for delivery to TFS and the sale of the same products by SPX Aus to TFS. That is to say, the documents demonstrate the insertion of SPX Aus as an intermediary purchaser/seller of VOKES branded products between Dollinger and TFS.(3)After receiving the three documents referred to, Mr Fasha caused a further review of the evidence served at that time for references to SPX Aus. The further review revealed that SPX Aus’s supply of VOKES branded filtration goods to TFS continued after December 2014. In that regard, the affidavit of Mr Bailey on behalf of TFS in July 2020 stated that:(a)from about 2014 until early 2020, TFS obtained all of certain VOKES branded spare parts from SPX Aus; and(b)from about 2014 until early 2020, TFS placed its orders for VOKES products with SPX Aus. There is no explanation by Mr Fasha why the July 2020 affidavit of Mr Bailey did not cause him at that stage to appreciate the role of SPX Aus such as to enable the application for joinder to have been brought then, or at least to make further enquiries at that time which may have enabled the application for joinder to have been brought a lot sooner than ultimately occurred. On behalf of Laminar, I was in effect asked to draw the inference that the role of SPX Aus had not occurred to Laminar or its legal representatives before the documents were produced in January this year. The respondents rely on the affidavit of their solicitor, Jennifer McEwan, who, relevantly, stated the following:(1)Although the evidence indicates that SPX Flow Inc is the ultimate parent company of SPX Aus as stated by Mr Fasha, a company search of Dollinger shows that there are no directors in common between SPX Aus and Dollinger. It appears from the company search that the present directors of Dollinger were appointed with effect from 30 March 2020.(2)Also, effective from March 2020, SPX Flow Inc sold its power and energy business to Celeros Flow Technology LLC as a result of which the “ownership of Dollinger” passed from SPX Flow Inc to Celeros. Annexed extracts from Celeros’s website confirm the sale and also indicate that various brands including DOLLINGER and VOKES are now controlled by Celeros.(3)In a telephone call to SPX Aus on 24 March 2021, Ms McEwan was told by the person who answered the phone that SPX Aus no longer sells VOKES branded products as they were part of “our power and energy division which got sold off last year”.(4)Mr Young’s affidavit on behalf of Laminar in November 2019 stated that TFS has since about May 2020 had a dedicated website for the VOKES Streamline product range and sells VOKES branded merchandise along with SPX Aus. Mr Young’s affidavit states that he is the director and founder of Laminar.Consideration

Decision

Reasons for decision

In short, this proceeding has been on foot for a long time, even discounting the early delays on account of this proceeding waiting for the outcome of other related proceedings. Moreover, it has been listed for trial since October 2020. Disruption of the trial date would prejudice not only the parties to this proceeding, but it would also have a deleterious effect for other litigants on the orderly scheduling of the work of the Court. It is no small matter to schedule a multi-day trial long in advance and to then have to later vacate that listing. Allowance has been made not only for the trial itself but also to commence the preparation of reasons for judgment. In the meantime other cases that could have been heard in that period have been listed for later dates. Doubtless the Court would not be idle if the trial dates were vacated as there is always much work to be done, but other parties would have been prejudiced by losing out on the reserved dates, and other parties will be prejudiced by losing out on the future reserved dates for this proceeding if the present trial dates are vacated.Conclusion For the reasons identified above, Laminar’s application for leave to amend its further amended originating application and its further amended statement of claim so as to join SPX Aus should be dismissed. There is no reason why it should not also bear the costs of that application. That said, there are minor respects in which Laminar’s intended amendments, which do not involve the joinder of SPX Aus, are justified. These are to amend an incorrect date and, if it still wishes to, to furnish additional particulars to certain existing paragraphs. Also, Laminar should amend the name of the third respondent from its previous name to its present name, i.e., Dollinger, where it appears in the pleadings. Laminar should accordingly have leave to file and serve the relevant documents showing those limited amendments. It should also bear any costs thrown away by those amendments.

Ratio Decidendi

Legal Principle Established

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