FEDERAL COURT OF AUSTRALIA
Lifeplan Australia Friendly Society Ltd v Woff [2016] FCA 364
File number: SAD 99 of 2012 Judge: BESANKO J Date of judgment: 14 April 2016 Catchwords: COSTS – costs order following final judgment – where multiple Calderbank offers made – where offer of compromise made under r 25.01 of Federal Court Rules 2011 (Cth) – whether it was unreasonable to reject offers – whether indemnity costs should be awarded.
PRACTICE AND PROCEDURE – form of final orders – whether declarations should be made – consideration of Court’s power to make declarations – where applicants established some but not all elements of claim – where no foreseeable consequences of declaration - where no public interest.
Legislation: Corporations Act 2001 (Cth) s 1317H(2)
Federal Court Rules 2011 (Cth) r 25
Cases cited: Ainsworth and Another v Criminal Justice Commission (1992) 66 ALJR 271; (1992) 106 ALR 11
Calderbank v Calderbank [1976] Fam 93
Forster v Jododex Australia Pty Limited (1972) 127 CLR 421
Gardner and Another v Dairy Industry Authority of New South Wales (1977) 52 ALJR 80; (1977) 18 ALR 55
Ibeneweka v Egbuna [1964] 1 WLR 219
Lifeplan Australia Friendly Society Ltd v Woff [2012] FCA 1415
Lifeplan Australia Friendly Society Ltd v Woff [2016] FCA 248
Rural Press Limited v Australian Competition and Consumer Commission [2003] HCA 75; (2003) 216 CLR 53
SC Johnson and Son Pty Ltd v Reckitt Benckiser (Australia) Pty Ltd (No 2) [2012] FCA 1362
Truth About Motorways Pty Ltd v Macquarie Infrastructure Management Ltd [2000] HCA 11; (2000) 200 CLR 591
Date of hearing: 31 March 2016 Registry: South Australia Division: General Division National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Category: Catchwords Number of paragraphs: 46 Counsel for the Applicants: Mr P Collinson QC with Mr M Douglas Solicitor for the Applicants: Ashurst Australia Counsel for the First and Second Respondents: Mr J Loewenstein Solicitor for the First and Second Respondents: Esser Legal Counsel for the Third Respondent: The third respondent did not appear Counsel for the Fourth Respondent: Mr R Macaw QC with Mr D Gration Solicitor for the Fourth Respondent: Turks Legal ORDERS
SAD 99 of 2012 BETWEEN: LIFEPLAN AUSTRALIA FRIENDLY SOCIETY LTD ACN 087 649 492
First Applicant
FUNERAL PLAN MANAGEMENT PTY LTD ACN 003 769 640
Second Applicant
AND: NOEL WOFF
First Respondent
RICHARD CORBY
Second Respondent
FUNERAL PLANNING AUSTRALIA PTY LTD (IN LIQUIDATION) (and another named in the Schedule)
Third Respondent
JUDGE:
BESANKO J
DATE OF ORDER:
14 APRIL 2016
THE COURT DECLARES THAT:
1.Each of Noel Jeffrey Woff (“Mr Woff”) and Richard John Corby (“Mr Corby”) breached duties and obligations owed by each of them to Lifeplan Australia Friendly Society Ltd (“Lifeplan”) and to Funeral Plan Management Pty Ltd (“FPM”), in that:
(a)between July 2010 and December 2010, without permission they took, used, disclosed to the…
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- Case
- [2016] FCA 364
- Decision Date
CaseChat Overview and Summary
The court found that the rejection of the Calderbank offers was unreasonable and that indemnity costs should be awarded. The reasoning was based on the principle that once reasons for judgment have been published, it is permissible and perhaps required to reformulate any foreshadowed declarations to accurately reflect the findings. The court held that the power to make declarations is broad, but it must be exercised with responsibility and only when circumstances call for it. The court decided to make the declaration against Mr Woff and Mr Corby as proposed by the applicants, with a specific alteration identified in the judgment. Regarding Foresters, the court declined to make the declaration sought by the applicants as there were no foreseeable consequences of such a declaration and no public interest involved.
The final orders included a permanent restraint on the use or publication of certain documents, a requirement for the respondents to deliver and destroy specific documents, and financial accountings by Mr Woff and Mr Corby. Additionally, the court ordered the payment of interest and detailed the cost implications, including indemnity costs for certain parties. The orders also addressed the applications to vary or add to previous orders, which were refused.
Orders
Orders of the court
2. Each of Mr Woff, Mr Corby, FPA and Foresters whether by themselves, their agents, employees or related entities (as defined by s 9 of the Corporations Act 2001 (Cth)) be permanently restrained from using or publishing the documents described in Annexure 1 to this Order.
3. Each of Mr Woff, Mr Corby, FPA and Foresters within 14 days:
(a) deliver to the applicants all hard copies of the documents described in Annexure 1 to this Order in each of their possession, custody or control; and
(b) permanently destroy all electronic copies of the documents described in Annexure 1 to this Order in each of their possession, custody or control
provided that the respondents may retain such copies for the purpose of this proceeding or any appeal until the conclusion of this proceeding or any appeal.
4. Mr Woff account, including within the meaning of s 1317H(2) of the Corporations Act 2001 (Cth) to the applicants in the sum of $24,238.
5. Mr Corby account to the applicants in the sum of $24,198.
6. Each of Mr Woff and Mr Corby pay interest to the applicants in an amount to be assessed if not agreed.
7. Subject to these orders and existing orders as to costs, the applicants pay Foresters’ costs of the proceeding on a party and party basis up to 11 am on 12 May 2015 and thereafter on an indemnity basis.
8. Subject to these orders and existing orders as to costs, Mr Woff and Mr Corby pay the applicants’ costs of the proceeding against them on a party and party basis up to 11 am on 12 May 2015, and the applicants pay the costs of Mr Woff and Mr Corby of the proceeding thereafter on a party and party basis.
9. The application by Mr Woff and Mr Corby to vary or add to the order made on 29 May 2015 be refused.
10. The application by Foresters to vary or add to the order made on 29 May 2015 be refused.
11. The applicants pay the costs of Mr Woff and Mr Corby on a party and party basis of the applicants’ application dismissed by order made on 12 December 2012.
ANNEXURE 1 – Part A
(Annexure A from Third Further Amended Statement of Claim)
Doc No
Applicants' Confidential Information
1.
Lifeplan Claims History Spreadsheet
2.
Lifeplan Interest Calculation Spreadsheet
3.
Funeral Plan Management Spreadsheet of Benefit Holders
4.
Funeral Plan Management New Funeral Director Checklist
5.
Funeral Plan Management New Funeral Director Checklist – Administration
6.
Lifeplan Bonus Rate Comparator Spreadsheet
7.
Funeral Plan Management Richard Corby Job Description
8.
Funeral Plan Management Noel Woff Job Description
9.
'Book 2' document
10.
Funeral Plan Management Top 50 Firms Updated document
11.
New Focus Pty Ltd Market Research Report – Prepaid Funeral Summary
12.
Funeral Plan Management Revenue Model Spreadsheet
13.
Lifeplan 'New Business-July-June2010' Spreadsheet
14.
Email describing printing volume and cost of PDS and Flyer
15.
Funeral Management Business Support Office Manual
16.
Lifeplan 'Library Q&A Project' document
17.
Funeral Plan Management 'NewBusinessComparisonBudgetv'sActual2006-07' Spreadsheet
18.
Funeral Plan Management 'Business Strategy-2010-11' document
19.
Funeral Plan Management 'Analysis of Business 2010-11' document
20.
Lifeplan 'Budget-2011 New Business & Claims – abbreviated mthxmth' Spreadsheet
21.
Lifeplan 'Budget – 2010 New Business & Claims' Spreadsheet
22.
Lifeplan 'Channel Sales Report – 2008-09' Spreadsheet
23.
Lifeplan 'NewBusiness-July-June 2010 – Geographical Spread' Spreadsheet
24.
Funeral Plan Management 'BonusComparison-MainCompetitors-2009' Spreadsheet
25.
Lifeplan 'Top Performers YTD June' Spreadsheet
26.
Funeral Plan Management Marketing Summary 2008
27.
Norwich Funeral Plan Management Business Plan 1999
28.
Funeral Plan Management 'Market Plan – Keyinvest' document
29.
Funeral Plan Management 'Marketing Plan 2008' document
30.
Lifeplan 'Cash Flow Story – Draft' document'
31.
Lifeplan 'Cash Flow Projections Pre-Need' document
32.
Funeral Plan Management 2010/2011 Travel, Accommodation and Entertainment Expense Budget Spreadsheet
33.
Funeral Plan Management 'Stationary and Promotional Item Budget FY10 11' Spreadsheet
34.
Lifeplan 'NewBusiness-July-June2010' spreadsheet
35.
Lifeplan 'Bonus Comparison-MainCompetitors-2010'
36.
List of Lifeplan/FPM funeral directors from the database held on the Melbourne Mailing;
Annexure 1 – Part B
(Annexure B from Third Further Amended Statement of Claim)
Doc No
Applicants' Materials
1.
Lifeplan Disclosure Document for the FuneralPlan Bond
2.
Lifeplan Disclosure Document for the FuneralPlan Pre-Paid
3.
Lifeplan Guide to Pre-Paid Funerals
4.
Funeral Plan Management Pre-Paid Funeral Contracts
5.
Funeral Plan Management Stationery Order Form
6.
Funeral Plan Management Funeral Benefit Fund Claim Form
7.
[See Annexure A, #1]
8.
[See Annexure A, #2]
9.
Funeral Plan Management Original FD Authority to Pay
10.
[See Annexure A, #3]
11.
Funeral Plan Management Template Letter to Funeral Director
12.
[See Annexure A, #4]
13.
[See Annexure A, #5]
14.
Funeral Plan Management Pre-Paid Funeral Plan Application Procedure
15.
Funeral Plan Management Steps in Completing Documentation for Pre-Paid Funerals
16.
Funeral Plan Management Funeral Bond Procedure Flowchart
17.
Funeral Plan Management Steps in Completing Documentation for Funeral Bonds
18.
Funeral Plan Management Steps in Completing Documentation for Making a Claim on Pre-Paid Funeral Plan or Funeral Bond
19.
Funeral Plan Management Pre-Need Promotion Evaluation Form
20.
Lifeplan Funeral Bond – Final Artwork
21.
[See Annexure A, #6]
22.
[See Annexure A, #7]
23.
[See Annexure A, #8]
24.
[See Annexure A, #10]
25.
[See Annexure A, #11]
26.
[See Annexure A, #12]
27.
[See Annexure A, #13]
28.
Funeral Plan Management Funeral Bonds Flyer – "A simple, secure investment toward future funeral expenses"
29.
[See Annexure A, #15]
30.
[See Annexure A, #1]
31.
[See Annexure A, #16]
32.
[See Annexure A, #17]
33.
[See Annexure A, #18]
34.
[See Annexure A, #19]
35.
[See Annexure A, #20]
36.
[See Annexure A, #21]
37.
[See Annexure A, #22]
38.
[See Annexure A, #23]
39.
'Bonus Rate – Nick.xls' Spreadsheet
40.
[See Annexure A, #24]
41.
[See Annexure A, #25]
42.
[See Annexure A, #26]
43.
[Not used]
44.
Lifeplan Capital Guarantee Fact Sheet
45.
Funeral Plan Management Introduction to Pre-Paid Funerals Flyer
46.
Funeral Plan Management Introduction to Funeral Bonds Flyer
47.
Funeral Plan Management Guide to Pre-paid Funerals Flyer
48.
Funeral Plan Management Personal Record of Preferred Arrangements Flyer
49.
Funeral Plan Management Family Tree Poster
50.
[See Annexure A, #28]
51.
[See Annexure A, #29]
52.
[See Annexure A, #30]
53.
[See Annexure A, #31]
54.
[See Annexure A, #32]
55.
[See Annexure A, #33]
56.
Funeral Plan Management 'A smart investment that shows you care – The Guide to Funeral Bonds' flyer
57.
Funeral Plan Management 'A little forethought, a great deal of benefit – The Guide to Pre-paid Funerals' flyer
58.
[See Annexure A, #34]
59.
[See Annexure A, #30]
60.
[See Annexure A, #35]
61.
[See Annexure A, #36]
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
It seems to me one thing to seek additional orders after reasons for judgment have been published. It is another to reformulate foreshadowed declarations so that they accurately reflect the findings made. The latter is permissible, perhaps even required. I think it appropriate to make the declaration against Mr Woff and Mr Corby which is set out in the applicants’ proposed orders, subject to the alteration which I have identified.Issue 2 – whether a declaration should be made against Foresters The declaration which the applicants seek against Foresters is in the following terms:THE COURT DECLARES THAT:…2.Foresters knowingly assisted and induced Mr Woff and Mr Corby to breach their duties and obligations owed by each of them to Lifeplan Australia Friendly Society Ltd (Lifeplan) and to Funeral Plan Management Pty Ltd (FPM), in that:a.between July and September 2010, Foresters knowingly assisted Mr Woff and Mr Corby to breach their fiduciary duties to Lifeplan and FPM by using Lifeplan’s and FPM’s confidential and valuable information in deciding whether to proceed with the Business Proposal;b.from 20 October 2010 until 29 December 2010 Foresters knew that Mr Woff, in breach of his fiduciary duties to Lifeplan and FPM, was soliciting business from funeral directors for the proposed business with Foresters and was likely to continue to do so, in circumstances where Foresters was working towards the proposed business and where it did nothing to discourage Mr Woff from soliciting funeral directors;c. between September and December 2010, Foresters;i.knowingly assisted Mr Woff and Mr Corby to breach their fiduciary duties to Lifeplan and FPM; andii.induced Mr Woff and Mr Corby to breach their contractual duties to Lifeplan and FPM;by playing an active role in the conduct of Mr Woff and Mr Corby taking impermissible steps towards establishing their new business by involving Mr Woff and Mr Corby in the changes to be made to the rules governing the Foresters’ fund and the preparation of the Foresters’ disclosure documents. The applicants submit that the Court’s power to make declarations is a very wide power. They referred to the observations made by Gibbs J (as his Honour then was) in Forster v Jododex Australia Pty Limited (1972) 127 CLR 421 at 437-438 that the Court (in that case, the Supreme Court of New South Wales) was given a broad discretion to make a declaration. His Honour referred to the observations of Lord Radcliffe in Ibeneweka v Egbuna [1964] 1 WLR 219 at 225. Lord Radcliffe said:After all, it is doubtful if there is more of principle involved than the undoubted truth that the power to grant a declaration should be exercised with a proper sense of responsibility and a full realisation that judicial pronouncements ought not to be issued unless there are circumstances that call for their making. Beyond that there is no legal restriction on the award of a declaration. The applicants also referred to Ainsworth and Another v Criminal Justice Commission (1992) 66 ALJR 271; (1992) 106 ALR 11 at 22 per Mason, Dawson, Toohey and Gaudron JJ; at 33‑34 per Brennan J, and to Tobacco Institute of Australia Limited v Australian Federation of Consumer Organisations Inc (No 2) (1993) 41 FCR 89 (“Tobacco Institute”), and in particular, the observations of Sheppard J at 94.