Macteldir Pty Ltd v Dimovski & Anor

[2005] HCATrans 234

[2005] HCATrans 234

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S276 of 2004

B e t w e e n -

MACTELDIR PTY LTD

Applicant

and

MILE DIMOVSKI

First Respondent

ROCKDALE ILINDEN SOCCER CLUB INC

Second Respondent

Application for special leave to appeal

GLEESON CJ
McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 22 APRIL 2005, AT 9.35 AM

Copyright in the High Court of Australia

MR N.J. NEIL, QC:   May it please the Court, I appear with my learned friend, MR P. LANDER, for the applicant.  (instructed by Petrovski Lawyers)

MR B.W. WALKER, SC:   May it please the Court, I appear with my friend MR R. ALKADAMANI for the respondents.  (instructed by John Ajaka Solicitor)

GLEESON CJ:   Yes, Mr Neil.

MR NEIL:   Your Honours, this is a matter in which the issue of whether a settlement of a claim that arose pursuant to a claim under the Copyright Act is something that is either within the jurisdiction of the Federal Court pursuant to section 39B(1A)(c) or is properly an associated matter.

GLEESON CJ:   Do you need an extension of time?

MR NEIL:   I was about to say, your Honour, we do need an extension of time.  We have requested the extension of time.

GLEESON CJ:   For how long?  How far out of time were you?

MR NEIL:   The decision of the Full Court was made on 17 October 2003 and as your Honours may have seen from the papers as the other matter relating to a claim against solicitors came for hearing there had by that time appeared some academic criticisms of the decision of the Full Court, one in an article in the Australian Law Journal ‑ ‑ ‑

GLEESON CJ:   You are almost a year out of time?

MR NEIL:   Yes, your Honour.  There had been some suggestions that the decision may not be correct and, however, as your Honours would see from page 603 of the application book, volume 2, there were some observations made.  The first judge to hear the matter had to disqualify himself and the next day we came before Justice Allsop on 20 July and at page 603 there are some quotes in the affidavit of the director, Mr Stojanovski, where his Honour at the commencement of paragraph 21 on the page, line 20:

raise something not without some consideration –

His Honour wished to raise a matter on which we might seek to get some instructions and his Honour referred to the obvious problems of costs.  His Honour took the view at line 30 that:

The Full Court’s decision is obviously binding –

although I should point out – there may be an argument that is in the original jurisdiction but, nonetheless, it would be considered very, very persuasive, perhaps well binding:

as to both the result and the precise reasoning process.  Sitting as a single judge I can do very little about that –

Then at line 40 his Honour said:

When one reads and understands LNC v BMW –

which, of course, is a well‑known case and if your Honours wish, I have brought photocopies but the reasoning there was a claim for damages for breach or for specific performance of a contract or a claim for relief for breach of trust is a claim for relief of a kind which is available under State law but if the contract or trust is in respect of a right or property which is the creature of federal law the claim arises under federal law.

GLEESON CJ:   This is a procedurally extremely messy matter, Mr Neil.

MR NEIL:   It is most difficult imbroglio, I accept that, your Honour, but it will get worse unless there is some definitive decision as to whether the Full Court’s proceeding is correct or not.  For example, if there were no decision on that matter we could envisage the solicitors nonetheless arguing, as they started to argue in light of some of the academic materials, but nonetheless, they had a good point that was at least reasonably arguable before the Full Court whereas the Full Court has simply said there was no jurisdiction.

In other words, there is basically an attack on the Full Court’s decision which, in our submission, could only be, and ought only to be resolved at this level, albeit there are attendant procedural problems because, as his Honour says:

questions could arise as to the correctness of the Court’s decision; now I can’t say more than that and it is one aspect that I will need some assistance from you on.  Not so much about the framework of the relief . . . but the proposition that the Court has no jurisdiction to hear a claim in contract; the contract being a compromise of a suit in Federal jurisdiction brought pursuant to an assertion of a claim pursuant to the Copyright Act as not being a matter arising under a law of Parliament is not obvious to me as to why the answer is clearly one that the Court is without jurisdiction.

So, we took instructions and, as the affidavit points out, the clients made a decision to seek an application for special leave out of time.

GLEESON CJ:   What is your attitude to the application for an extension of time, Mr Walker?

MR WALKER:   We oppose it, your Honour.

GLEESON CJ:   Yes, go ahead, Mr Neil.

MR NEIL:   His Honour had said at line 25 on page 603:

What I am indicating is not, at all, any view whatsoever about the merits of this application, far from it, but in a sense it is a question for you as to whether or not consideration has been given to an application for special leave out of time.

So we are as much in something of a dilemma as perhaps one could be in the sense that we had proposed to mount a proposal to the court that the Full Court decision was right and that the case had been run on a misapprehension.  On the other hand, some academic and other writings have thrown into some doubt the Full Court’s decision.  His Honour has difficulty with it and we then are in the position, somewhat paradoxically, that we would want to have a decision, the effect of which, as we now argue, would be to say that the Full Court’s decision was not correct and there was jurisdiction.  In essence, your Honours, it is a very difficult logical problem, we would submit – sorry, procedural problems have arisen arising out of a very simple matter.

The simple matter ought to have been, if parties come to an agreement to settle a case involving copyright matters and if one of the parties, it is alleged, breaches the agreement and some relief is sought surely that ought to be, either pursuant to section 32 or pursuant to section 39B, a matter that arises out of or is associated with the original case.  But it seems that if this Court were not able to deal with the matter there could be many cases where it is argued that if, for example, you do not end up getting court orders for the terms of the settlement or actual undertakings then it would be said it is all contractual as between the parties and therefore you have to start a totally new case and you would have to plead a contractual claim and there would be defences to it, whereas, what might otherwise be a very simple matter is thoroughly complicated.

For example, we would say, on our case, that the 2002 directory, which was the offending later year publication, is really evidence of the breach of the agreement in relation to the 2001 year directory.  It is not a separate new cause of action in contract.  It is absolutely intermingled with the previous matter.  I think a phrase was used by Justice Gaudron in the PCS Case that one simply has to make a practical judgment as to the relationship between the matters.

We would submit the Full Court must have been clearly wrong in respect of the lack of association.  The Full Court, I accept, did not have before it in precise terms, an argument relating to section 39B(1C)(a) but we would submit it is an important matter because unless that were clarified also if the matter proceeded against the solicitors with them arguing, in effect, that there was possibly some jurisdiction in that regard, but they not having run that point previously, there would be a further procedural entanglement.

In our respectful submission, the way in which this matter is to be dealt with should be by virtue of this Court dealing with the topic that clearly concerned Justice Allsop.  As to the discretionary matters, your Honour, we perhaps might seek indulgence to add one or two of those points to any notice of appeal because it would be our submission we would reasonably want to challenge the proposition that you would have to open up by some reinstatement of the old proceeding before you can seek enforcement of the old proceeding.

We would have thought that simply missed the point and that the suggested discretionary problems in that area do not really exist or if they do exist ought to be in the modern era disposed of by short argument on appeal.  So, your Honours, whilst I would accept there are considerable procedural difficulties and whilst the matter would have some difficulties attendant to it it is clear that there would be, we would submit, a greater imbroglio if there is not some decision by this Court on the two – what ultimately, we would submit, are simple matters.

McHUGH J:   What do you say about the proposition that you deliberately sued on the more broadly expressed agreement reflected in the terms of the settlement as such?

MR NEIL:   Your Honour, in the long run it came down to the fact, we would submit, that as the – because I accept that the notice of motion and the pleadings throughout were extremely, perhaps complicated, but as the parties seem to have accepted and as the Full Court noted and as the special case stated, by the time the matter got to the level of the Full Court, as appears at page 560, the special case had stated:

The applicant’s claim is for breach of the terms of settlement.

At line 40 on that page, after referring to the history of the matter and the special case, the judgment says:

Having regard to the matters set out above, this must be regarded as a question whether the Court has jurisdiction to grant injunctive

relief or damages in respect of the respondent’s alleged breach of the Terms of Settlement filed in Court on 7 August 2001.

At page 559 there had been the references to the statements at the trial before Justice Madgwick where:

The matter comes down to the enforcement of the terms.

So that the short point as to whether enforcement of terms of settlement of a matter without the court orders having been made but arising out of a federal matter is to be either associated or a matter arising, we would submit, is capable of being determined by the Court so that we do not have these problems.

McHUGH J:   One of the problems I have is that it cannot be said to be the same substratum of facts because you have added a new set of facts that came into existence after the settlement of the original proceedings.  How do you relate the jurisdiction of the Federal Court back to the original proceedings?

MR NEIL:   By this, your Honour, that the new – and I accept that is a point made against us, but I would answer it this way – the new set of facts were, in reality, the complaint that evidence, or the evidence of the breach of the agreement because they had printed, we allege, the directory in 2001 contrary to our copyright rights.  If there had been a settlement they would not do it again.

In 2002, on our case, they do it again and there is a new directory, so we bring a case on the directory which was not properly necessarily enunciated in the pleadings as it should have been but was ultimately treated as the case that was seeking to enforce the terms of settlement, presumably, by using that new set of facts as evidence of the breach that had previously occurred, therefore, being invariably part of the substratum.  It was proof that the previous facts had given rise not to a settlement that held but had given rise to a settlement that had been breached.  That is how we put that, your Honour.

In our respectful submission, it is a case perhaps even in terms of the administration of justice provision that this Court should take in order to give guidance and resolve the problems and avoid the possibility of arguments of cases being objected to where there have been settlements where this argument is raised about some kind of contractual arrangement between the parties and we have this kind of regrettable imbroglio repeated.  May it please the Court.

GLEESON CJ:   Thank you, Mr Neil.  We do not need to hear you, Mr Walker.

The procedural complexities involved in and resulting from the steps taken at early stages of these proceedings produced the result that the case is not a suitable vehicle for the resolution of any issue appropriate to a grant of special leave to appeal.  In those circumstances, we are not minded to grant the substantial extension of time necessary to allow the application to proceed and the application is dismissed with costs.

AT 9.50 AM THE MATTER WAS CONCLUDED