LEACH v Prestige Real Estate Services Pty Ltd

[2019] FCCA 2289

FEDERAL CIRCUIT COURT OF AUSTRALIA

LEACH & ANOR v PRESTIGE REAL ESTATE SERVICES PTY LTD & ORS [2019] FCCA 2289

Catchwords:
INDUSTRIAL LAW – Procedure – Application to strike out Statement of Claim.

Legislation:

Federal Circuit Court Act 1999, s.17A

Federal Circuit Court Rules 2001, r.13.10

Federal Court Rules 2011 , rr.16.01, 16.02, 16.03, 16.06

Cases cited:

Banque Commerciale SA (in liq) v Akhil Holdings Ltd (1990) 169 CLR 279

Bruce v Odhams Press Ltd [1936] 1 KB 697

Dare v Pulham (1982) 148 CLR 658

Gould & Ors v Mount Oxide Mines Ltd (In Liquidation) (1916) 22 CLR 490

H 1976 Nominees Pty Ltd v Galli (1979) 30 ALR 181

Pinson v Lloyds & National Foreign Bank Ltd

Price v DET (NSW) [2008] FMCA 1018

Trade Practices Commission v David Jones (Australia) Pty Ltd (1985) 7 FCR 109

First Applicant: DARREN LEACH

Second Applicant: JULIA LEACH

First Respondent: PRESTIGE REAL ESTATE SERVICES PTY LTD

Second Respondent: MICHAEL BUCKLEY

Third Respondent: CHRISTINE RADOVAN

File Number: SYG 1896 of 2018

Judgment of: Judge Obradovic

Hearing date: 4 April 2019

Date of Last Submission: 4 April 2019

Delivered at: Parramatta

Delivered on: 22 August 2019

REPRESENTATION

Counsel for the Applicants: Mr Byrne

Solicitors for the Applicant: Nathan Cox Lawyers

Counsel for the Respondents: Mr Miles

Solicitors for the Respondents: Jemmeson & Fisher Solicitors & Accountants

ORDERS

1. The Further Amended Statement of Claim filed 1 November 2018 is struck out.

2. The Applicants have leave to file a new Statement of Claim on or before 4pm on 27 September 2019.

3. If the Applicants fail to comply with order 2 above, then the proceedings will be summarily dismissed.

4. The Applicants are to pay the Respondents costs as agreed or assessed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PARRAMATTA

SYG1896/2018

DARREN LEACH

First Applicant

JULIA LEACH

Second Applicant

And

PRESTIGE REAL ESTATE SERVICES PTY LTD

First Respondent

MICHAEL BUCKLEY

Second Respondent

CHRISTINE RADOVAN

Third Respondent

REASONS FOR JUDGMENT

1. Pursuant to an Application in a Case filed on 29 November 2018 (“Application”), the Respondents in the substantive proceedings (“Respondents”) seek orders that the Further Amended Statement of Claim filed on 1 November 2018 (“FASOC”) by the Applicants in the substantive proceedings (“Applicants”) be struck-out and the proceedings be otherwise dismissed.

2. The Respondents rely on Section 17A of the Federal Circuit Court of Australia Act 1999, Rule 13.10 of the Federal Circuit Court Rules 2001 (“FCC Rules”).

3. The Respondents submit that the FASOC is defective in that it fails to comply with FCR 16.01, 16.02(d), 16.03 and 16.06. It is further submitted that the defects in the FASOC are so significant that they are unable to be cured by an order for particulars. Lastly, it was submitted on behalf of the Respondents that the most appropriate order[1] in the circumstances of this case may be for the striking out of the FASOC in whole, or the striking out of offending pleading/s, coupled with the grant of leave to re-file or amend (accompanied by self-executing orders in the event of further non-compliance or default), and an order as to costs thrown away and in respect of or incidental to this Application.

   [1] Price v DET (NSW) [2008] FMCA 1018 at [14]-[18]

4. In summary, the Respondents submit that the FASOC generally fails to state material facts, is based on conclusions drawn from facts which have not been pleaded, inappropriately seeks to supplement pleadings with particulars and otherwise fails to disclose any reasonable cause of action against the Respondents to the point that the Applicants have no reasonable prospects of successfully prosecuting their asserted claim. In their submissions, the Applicants have detailed their criticism in respect of each paragraph of the FASOC.

Concessions

1. The Applicants concede that no cause of action is sought in respect of the Second Applicant or against the Third Respondent. It therefore follows that the Application of the Second Applicant should be dismissed, that the Application of the First Applicant as against the Third Respondent should be dismissed and that the Second Applicant and Third Respondent ought to be removed as parties to the proceedings. The making of such orders is dependent upon whether the FASOC is struck out or not.  

Further Amended Statement of Claim

1. The FASOC is a difficult document to read, comprehend and answer. Indeed, it is a document which fundamentally fails to meet the function of a pleading. The function of a pleading is to state with sufficient clarity the case that must be met[2]. It is a basic rule of procedural fairness[3]. In performing this basic function, proper pleadings also identify issues in dispute, promote the conduct of efficient proceedings, and facilitate the assessment of the relevance and admissibility of evidence[4].

   [2] Gould & Ors v Mount Oxide Mines Ltd (In Liquidation) (1916) 22 CLR 490, per Isaacs and Rich JJ at 517.

   [3] Banque Commerciale SA (in liq) v Akhil Holdings Ltd (1990) 169 CLR 279 at 286.

   [4] Dare v Pulham (1982) 148 CLR 658 at 664

2. Pleadings that are in form and substance embarrassing or evasive should not stand simply because they afford a defendant the opportunity of either not pleading to them, or advancing a bare denial. Such an outcome is of little utility in the administration of justice.

3. The facts in the body of the pleading, standing alone, must be sufficient to make out the Applicant's case. Gaps in a pleading cannot be filled by particulars and a party should not and need not plead to particulars. [5] Particulars are not statements of material fact. Their function is to fill in the picture of the cause of action with information sufficiently detailed to put the opposing side on guard as to the case to be met[6].  

   [5] Trade Practices Commission v David Jones (Australia) Pty Ltd (1985) 7 FCR 109 (citing H 1976 Nominees Pty Ltd v Galli (1979) 30 ALR 181)

   [6] Pinson v Lloyds & National Foreign Bank Ltd, supra (at 75 per Scott LJ, citing Bruce v Odhams Press Ltd [1936] 1 KB 697 (at 712-713 per Scott LJ))

4. Specifically, the FASOC fails in the function of a pleading in that:

   a)It fails to identify the basis upon which the Applicants are entitled to commence these proceedings;

   b)In purporting to plead an "Agreement" between the First Applicant and the First Respondent, the Applicants' particularise an "oral" agreement entered into pursuant to "Deed for the Sale of Shares". It is unclear whether, on the facts pleaded, namely “In about December 2015, the First Plaintiff and the First Defendant entered into an agreement with respect to real estate agency services” on what basis the agreement was said to have been concluded. The First Plaintiff does not plead the material facts necessary to reach any conclusion as to what constituted the agreement and how the agreement was made, including failing to plead when and where the discussions took place and the substance of what was said and by whom;

   c)The Applicants fail to identify precisely terms that are alleged to be partly express and partly implied from the terms of the "express agreement". Neither the express terms nor the implied terms, nor the basis upon which such implied terms are alleged to be implied, are pleaded. The Applicants pleads express terms without identifying the foundation of such express terms;

   d)In pleading that the alleged agreement “with respect to real estate agency services” is an “employment contract” the paragraphs identified do not themselves identify or otherwise support the basis upon which an employment contract is said to arise. These conclusions invite speculation as to how they were reached, and as such, are not possible of being answered;

   e)Paragraph 8 pleads a raft of unparticularised allegations in a general way. The numerous sub-paragraphs and sub-sub paragraphs are difficult to follow, and plead matters “in the premises” which are absent any identification of the First Applicant as a "National System Employee" for the purposes of the Fair Work Act 2009. Paragraph 8 and paragraph 7 appear to be prima facie inconsistent or at least confusing as to what constituted the relationship as said to be pleaded in the FASOC;

   f)The claims in the alternative fail to identify the basis upon which the alleged alternative claim is a valid claim in circumstances where the primary claim fails;

   g)Paragraph 13 makes broad and general assertions,  fails to plead the foundation for each of the contraventions alleged; fails to particularise each of the contraventions alleged; fails to plead the basis for the alleged "knowledge" of the Second Respondent in respect of each of the contraventions alleged; and fails to plead and/or particularise the basis upon which the Second Respondent is "involved in" each of the contraventions alleged. The Applicants fail to plead what they say are the elements of the contravention and fail to identify the material facts said to establish knowledge or from which such knowledge is to be inferred.[7]

   [7] As to pleading requirements in relation to an allegation that a person was knowingly concerned in a contravention, see summary by Thawley J in Whitby v ZG Operations Australia Pty Ltd [2019] FCS 201 at [29] and following

5. In circumstances where the Applicants' pleaded case is so inherently defective and bad, it is appropriate that the FASOC be struck-out in whole. While it may be possible for the FASOC to be further amended, the document which may be produced as a result of such further amendments will be marred by further difficulties inherent in trying to remedy the defects which have been identified.

6. It is, in all of the circumstances, appropriate to grant leave to the Applicants to re-file a Statement of Claim which complies with the function of a pleading. It is appropriate that there be an order that upon default the proceedings be struck out. It is also appropriate that a costs order follow the making of these orders, being costs thrown away and the costs of this application.

I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of Judge Obradovic

Associate: 

Date: 22 August 2019