Marinis v Prendergast
[2019] WASC 215
•21 JUNE 2019
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: MARINIS -v- PRENDERGAST [2019] WASC 215
CORAM: KENNETH MARTIN J
HEARD: 12 JUNE 2019
DELIVERED : 21 JUNE 2019
FILE NO/S: CIV 3208 of 2016
BETWEEN: JIM MARINIS
First Plaintiff
SPORTS MARKETING AGENCY PTY LTD
Second Plaintiff
AND
IAN PRENDERGAST
First Defendant
AUSTRALIAN FOOTBALL LEAGUE PLAYERS ASSOCIATION INC
Second Defendant
BRADEN STOKES
Third Defendant
AUSTRALIAN FOOTBALL LEAGUE
Fourth Defendant
KEN WOOD
Fifth Defendant
Catchwords:
Security for costs - Failure to meet ordered payment - Resultant stay - Dismissal application - Springing order - Discretionary considerations - Pleaded merits
Legislation:
Nil
Result:
Springing order issued
Category: B
Representation:
Counsel:
| First Plaintiff | : | Mr J MacLaurin |
| Second Plaintiff | : | Mr J MacLaurin |
| First Defendant | : | Ms D M Templeman |
| Second Defendant | : | Ms D M Templeman |
| Third Defendant | : | Ms D M Templeman |
| Fourth Defendant | : | Mr A J Rickarby |
| Fifth Defendant | : | Mr A J Rickarby |
Solicitors:
| First Plaintiff | : | MGM O'Connor Lawyers |
| Second Plaintiff | : | MGM O'Connor Lawyers |
| First Defendant | : | Gilchrist Connell |
| Second Defendant | : | Gilchrist Connell |
| Third Defendant | : | Gilchrist Connell |
| Fourth Defendant | : | K & L Gates |
| Fifth Defendant | : | K & L Gates |
Case(s) referred to in decision(s):
Aon Risk Services Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175
Capital Webworks Pty Ltd v AdultShop.Com Ltd [2008] FCA 423
Dallas Development Corp Pty Ltd v Western Australian Land Authority [2000] WASCA 49
Idoport Pty Ltd v National Australia Bank [2002] NSWSC 18
John v Neiman Holdings (1986) 84 FLR 84
Trafalgar West Investments Pty Ltd as trustee for the Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [No 11] [2016] WASC 152
Trafalgar West Investments Pty Ltd as Trustee for the Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [No 9] [2016] WASC 68
Westonia Earthmoving Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [No 2] [2014] WASC 196
KENNETH MARTIN J:
Introduction
On 9 November 2018, I heard an application made on behalf of the first, second and third defendants that the plaintiffs provide security for costs (the security for costs application). After hearing extensive arguments from counsel on the disputed application, I acceded to the security for costs application.
Specifically, my orders 2, 3 and 4 made that day were issued in the following terms:
2.The Respondents (Plaintiffs) are to pay security for costs to the Applicants (the first, second and third defendants) by payments into court or another form of security in lieu that is agreed by the parties, in the sum of $150,000 in 2 tranches:
(a)Tranche 1 - $75,000 to be paid by no later than 9 January 2019.
(b)Tranche 2 - $75,000 to be paid upon the completion of discovery.
3.If the Respondents (Plaintiffs) fail to pay Tranche 1 by 9 January 2019, this action will be stayed as against the First, Second and Third defendants until further order.
4.The directions hearing on 15 November 2018 is vacated and the matter re‑listed in the CMC List for further directions on 31 January 2019 at 9.30 am.
However, as at 9 January 2019, the Tranche 1 security amount of $75,000 ordered under par 2(a) of the above orders was not paid. No explanation or affidavit material was filed on the part of the plaintiffs either seeking an extension of time to meet the payment or, alternatively, explaining why the payment had not been made by that time.
By order 3 above, the plaintiffs' action against the first, second and third defendants was consequently stayed from 9 January 2019 onwards. That stay, as I explain, remains in place.
As was foreshadowed under order 4 above, there was a further directions hearing in the CMC List conducted before me on 31 January 2019. At that time, with the plaintiffs still not providing the Tranche 1 security, I then ordered that the plaintiffs' action be further stayed as against the fourth and fifth (ie, as against all) defendants until further order. That is the present status quo.
More significantly, however, on 31 January 2019 I also then made a further order granting leave to the first, second and third defendants to bring an application to dismiss the plaintiffs' action - by reason of failure to meet the security for costs orders (made on 9 November 2018) - after 28 February 2019. The effect of that order, in practical terms, was to allow the plaintiffs all of the month of February 2019 to raise and pay the Tranche 1 security amount of $75,000. Only after 28 February 2019 did the 31 January 2019 orders envisage that the first, second and third defendants might then apply to have the plaintiffs' action dismissed if there was continued failure to provide that security amount (if that remained the position at the end of February 2019).
The Tranche 1 security amount of $75,000 was still not paid by the plaintiffs by 28 February 2019. The action has remained stayed against all defendants in the face of that continued default.
As matters have transpired, the first, second and third defendants did not file their present application seeking a dismissal of the action until 10 April 2019 (the dismissal application). This is the application with which I am presently dealing.
The dismissal application of the first, second and third defendants seeks orders to the effect:
1.the action against the first, second and third defendants be dismissed; and
2.the first and second plaintiffs pay the first, second and third defendants' costs of the action, to be taxed if not agreed.
The dismissal application is opposed by the plaintiffs.
Background
Stepping back slightly in time, I ought to explain that on 28 February 2019 at 4.53 pm my Associate received an email from the lawyers for the plaintiffs (copied to the lawyers for the other parties) enclosing a letter to the court by a partner of MGM O'Connor Lawyers, Mr Galic. The attached letter was erroneously dated '29' February 2019. But the covering email under which the letter was despatched indicates its correct date.
As may have been noticed, 28 February 2019 was the last date by which my 31 January 2019 orders envisaged the plaintiffs would, in effect, be protected from facing an application for dismissal of their action - by reason of any continued failure to provide the Tranche 1 security amount of $75,000.
The letter to the court by Mr Galic on behalf of the plaintiffs read in the following terms:
We are instructed that security is able to be provided by a third party secured against property. That will necessitate a variation to His Honours [sic] orders.
There has been conferral with the First Second and Third Defendants [sic] solicitors about extending the time for providing security until 31 March 2019. The extension has not been agreed. In the circumstances [a] formal application is necessary.
Please advise the earliest this matter may be relisted before His Honour to hear our client's [sic] application. Affidavit evidence will be filed.
However, as matters then transpired, no formal application as foreshadowed or any affidavit evidence seeking an extension of time and a variation of the previous security for costs orders was ever made on behalf of the plaintiffs.
Hence, the first, second and third defendants were at liberty to bring an application seeking a dismissal of the plaintiffs' action at any time from March 2019. But it was only at 10 April 2019 that the first, second and third defendants through their lawyers made the dismissal application by letter to the court.
So, as may be seen, five months elapsed over the period between 9 November 2018 and 10 April 2019 before the dismissal application was brought. The first, second and third defendants held off bringing a dismissal application during March, effectively affording an extra month to the plaintiffs to facilitate compliance with order 2(a) of my orders of 9 November 2018.
In the 10 April 2019 letter, the lawyers for the first, second and third defendants, Gilchrist Connell, wrote to my Associate requesting a special appointment to hear the dismissal application on the basis of the plaintiffs' failure to provide the Tranche 1 security. A minute of proposed orders was then submitted, along with a conferral memorandum relating the numerous unproductive conferral communications between themselves on behalf of the first, second and third defendants and MGM O'Connor Lawyers for the plaintiffs over the period between 25 February 2019 and 9 April 2019. Item 1(l) of the conferral memorandum related a development prior to the bringing of the dismissal application on 10 April 2019. That penultimate event was:
(l)On 9 April 2019 Mr Galic emailed Gilchrist Connell to state that he does not have instructions or counsel's unavailable dates 'until counsel is expected to be back on Monday' and suggesting that Gilchrist Connell 'hold off bringing your application or [sic] another seven days or until you hear from us', stating that he anticipates responding 'by Monday'; and also stating that he 'expect[s] instructions to bring an application on behalf of the Plaintiff' without specifying the nature of the application.
On 11 April 2019, through my Associate, I indicated availability to list the dismissal application of the first, second and third defendants for hearing on 15 May 2019. Subsequently, however, I received a communication from MGM O'Connor Lawyers to the effect that the plaintiffs' counsel would not be available until June 2019, due to other commitments. Consequently, I eventually listed the dismissal application for a special appointment hearing even later, on 12 June 2019, to accommodate the plaintiffs' availability issue.
Notwithstanding an extended temporal opportunity, there was still no application brought by the plaintiffs seeking any extension of time or a variation of any of the prior security for costs orders. The special appointment hearing date of 12 June 2019, of course, was over seven months subsequent to my making of the security for costs orders on 9 November 2018.
Hence, the plaintiffs are now in continuing breach of the order to pay Tranche 1 for over five months, since 9 January 2019. The action itself, which is still in its earliest phases notwithstanding its 2016 commencement, has remained stayed against the first, second and third defendants since then by reason of those matters. The action has also been stayed against the fourth and fifth defendants under orders of 31 January 2019 - for a period now exceeding four months.
The inactive progress of the action, to say the least, is unsatisfactory.
Some prior developments
The security for costs orders that issued on 9 November 2018 were made against the plaintiffs' opposition. But as I mentioned, there was no appeal taken against the security for costs orders.
On 9 November 2018, I made some extempore observations concerning what I had perceived, in effect, then as a lack of pleaded coherency and observable merit in the plaintiffs' then amended statement of claim filed 6 April 2018. In those unpublished reasons I said, at ts 48:
So, at the end of the day, I look at this pleading and there are some red flags that immediately jump out to me about it in terms of this bundle of argued causes of action. Allied to the fact that it has not proceeded other than to the point after 2016 where we have an amended statement of claim and there are some reasons underlying that but the matter is proceeding at less than rapid pace and in circumstances where I think the pleading is going to have to be corrected sooner rather than later to address some deficiencies.
I further observed, after indicating that security for costs orders would be made, at ts 50:
But I do think some independent sort of focused input is needed sooner rather than later but I'm inclined not to put a time line on that but, assuming security is provided, and assuming the matter is then to be programmed swiftly to a trial, it probably would be wise to have a revised pleading by no later than 9 January next year.
However, as things transpired, there was no revised statement of claim (or minute thereof) by 9 January 2019, or at the directions hearing of 31 January 2019. However, a minute of substituted revised pleading did eventually arrive on 11 June 2019 - on the evening before the hearing of the present dismissal application.
Submissions towards the dismissal application hearing on 12 June 2019
Notwithstanding what had previously been advised to the court on 28 February 2019 by the lawyers for the plaintiffs, there has never been an application by the plaintiffs made seeking a formal extension of time or a variation to my prior orders for security. But the plaintiffs' resistance to the present dismissal application effectively seeks more time to comply.
The written submissions of the first, second and third defendants
On 10 June 2019, the first, second and third defendants filed short written submissions in support of the application for dismissal and judgment. They rely upon affidavits and materials previously filed and read during the course of the contested 9 November 2018 hearing on the initial making of orders for security.
The written submissions refer to the court's inherent power to dismiss an action where there has been a failure to comply with an order made for the provision of security for costs, noting a decision of the Court of Appeal in Dallas Development Corp Pty Ltd v Western Australian Land Authority [2000] WASCA 49 and some subsequent contemporary case management observations by his Honour Edelman J, made whilst a member of this court, in Westonia Earthmoving Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [No 2] [2014] WASC 196. There was no dispute about this court's power to issue the dismissal orders the subject of the present dismissal application. The only issue is their appropriateness at this time and their terms, if made.
The written submissions of the first, second and third defendants contend that as a matter of discretion under an exercise of the court's inherent powers there is no antecedent juridical requirement for a 'last opportunity' springing order to be issued prior to the issuing of an order dismissing an action by reason of failure to comply with a security for costs order. I agree with that analysis. But the question presents more as one of what is a fair and just discretionary order in all the circumstances.
The first, second and third defendants' submissions pointed to an absence of any amended pleading or minute thereof, notwithstanding the pleading deficiency observations that I offered on 9 November 2018 (referred to above) and which looked to have been undisputed. These defendants point out, further, that my directions of 31 January 2019 had specifically contemplated an application for dismissal brought subsequent to 28 February 2019 in the event of ongoing default. They also point to the failure to comply with the order for the payment of the Tranche 1 security amount of $75,000, resulting in the action being stayed as against the first, second and third defendants from 9 January 2019 (a period of five months). Finally, these defendants point to a failure by the plaintiffs to file any evidence explaining the sustained failure to meet the Tranche 1 security for costs order or, further, to take any step to submit a reamended statement of claim or a minute.
The written submissions of the first, second and third defendants also relate that it is more than eight years since some events the subject of the proceedings, two and a half years since the plaintiffs' writ issued in 2016 and four years since the plaintiffs obtained their pre-action discovery before Master Sanderson in this court.
The submissions of the first, second and third defendants conclude at par 15:
The plaintiffs have had many opportunities to satisfy their duties as litigants. It can be inferred from the entirety of their conduct that the plaintiffs are not willing or able to do so. The affidavit of the first plaintiff [Mr Marinis] of 8 November 2018 reflects a lack of regard for his duties as a litigant, the authority of the court, or the interests of other parties.
The plaintiffs' written submissions
It was not until late on 11 June 2019 (the day before the hearing) that there finally emerged from the plaintiffs' lawyers an outline of written submissions - submitted in opposition to the application for dismissal. There was also filed a late affidavit from Susan Leanne Marinis, Mr Marinis' wife, in terms I will relate below.
The written submissions filed on behalf of the plaintiff, signed by counsel, oppose dismissal, contending (in part):
12.It is inapt and highly problematic for the defendants to assert that the plaintiffs have received 'the equal warning to a springing order' by the matters described in par 9(c) to their Outline of Submissions, being comments or observations from the Court, acknowledgements from Counsel as to desirability or wisdom of things and orders from the Court providing for certain applications to be brought. This is particularly having regard to the significance of a springing order. There is no equivalence between these matters such as would justify the defendants proceeding to obtain a dismissal in this case.
13.There is no relevant identifiable or deposed-to prejudice to the defendants in this case. The defendants are well resourced, have been put on notice of the claim for a significant period of time, and have been represented by experienced and reputable litigation solicitors from the outset - including during pre‑action discovery proceedings.
Notwithstanding those late written submissions for the plaintiffs contend, in effect, that the dismissal application is without merit, I was informed by Mr MacLaurin, counsel for the plaintiffs, at the commencement of arguments on 12 June 2019 that an open offer had been verbally put the previous evening to the lawyers for the first, second and third defendants - but rejected. [I observe for completeness that the lawyers for the fourth and fifth defendants, whilst represented at this hearing, effectively, did not seek to put any submission to the court concerning the dismissal application of the other defendants.]
Mr MacLaurin informed the court that the open offer of the previous evening as put on behalf of the plaintiffs was that the plaintiffs would, in effect, agree to the court issuing a self‑executing springing order dismissing the plaintiffs' action against the first, second and third defendants, but only after the elapse of a further seven weeks from the date of the hearing - if the Tranche 1 security was not paid within this further period.
The open offer proposal was not acceptable to the first, second and third defendants who, through counsel, Ms Templeman, move for the immediate dismissal of the plaintiffs' action against those defendants.
I should also mention that the court received at around 5.43 pm on Tuesday evening, 11 June 2019, a minute of substituted statement of claim from the lawyers for the plaintiff. The covering email delivering that document advised:
The minute has still not been edited and apologise [sic] in advance for any errors (if any) that will be corrected before being signed by counsel who prepared the minute.
There were obviously a number of errors within the late minute, the most obvious of which was that prayers for relief on page 18 sought no relief against the fourth and fifth defendants. During the course of arguments made by counsel for the plaintiffs, a further version of this minute was handed up to the court.
Apart from the minute of substituted statement of claim being provided extremely late both to the court and to the other defendants (thereby denying recipients a reasonable opportunity to digest and evaluate the proposed revised pleading), the task of urgently reviewing the proposed repleaded document was made more difficult by the fact that it was provided as a minute of fully substituted pleading - without any markings showing the excisions and fresh augmentations. I will not draw an adverse inference that the late provision of this minute of proposed substituted statement of claim, was tactical. However, its unduly late provision in wholly unmarked form was unhelpful. Moreover, a suggestion that it had not been possible to file and circulate a revised minute of pleading any earlier due to the stay of the action is fatuous, in my assessment. There was no reason why a minute of the proposed revised pleading could not have been worked on or provided a lot earlier.
A party in default cannot take advantage of its own default and the consequences of that default. As I said in Trafalgar West Investments Pty Ltd as trustee for the Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [No 11] [2016] WASC 152 [11] (Trafalgar West [No 11]) as regards the effects of a stay in the context of the law concerning bankruptcy (with in principle applicability to the present circumstances) by reference to the observations of Young J in John v Neiman Holdings (1986) 84 FLR 84, 86:
All that is meant by a stay in the current connection is that nobody can take any step in the proceedings, nobody can make any order in the proceedings, but that the parties are not prevented from getting the matter ready for trial, nor is anything undone which has been done.
In other words, I am wholly unmoved by any suggestion that the proceedings being stayed somehow inhibited the plaintiffs from getting on with the task of putting their house in order as regards somewhat obvious and indeed conceded deficiencies at the time in their current pleading. Unfortunately, a proposed amended pleading only emerged at the eleventh hour. But on review it still appears to manifest some in‑principle weaknesses.
It is important to weigh what is the proposed repleaded case of the plaintiffs within the overall holistic discretionary assessment by the court required upon on the present dismissal application. The potential merits of the plaintiffs' case (at least on paper) must be considered within the context of weighing up what are accompanying and broader potential denial of access to justice policy considerations, including the likelihood of the potential relief sought being granted weighed against the consequences of the immediate dismissal of the plaintiffs' action predicated upon failure to provide the Tranche 1 security.
Before discussing the parties' rival positions any further, it is necessary to refer to the (somewhat inadequate) content of Mrs Marinis' late affidavit relied upon by the plaintiffs. This, I repeat, is the only evidence resisting the present dismissal application. There was no affidavit received from the first plaintiff, Mr Marinis, himself for this application.
Affidavit of Susan Leanne Marinis filed 11 June 2019
Previous materials had disclosed that Mr Marinis owns no property or assets under his name. The family residence at which he resides, a property in Williamstown, Victoria, is owned by his wife and is the subject of a registered mortgage to the National Australia Bank (NAB).
In the late affidavit of 11 June 2019, Mrs Marinis describes herself as a resident of Williamstown, Victoria, and as being an NAB employee.
After explaining her spousal relationship to Mr Marinis, she continued:
2.I am aware of the nature of these proceedings and the fact that my husband was ordered to make payment of security of costs into court in the sum of $75,000.00 with liberty for the first, second and third defendants (Defendants) to apply for more security.
3.My husband was not able to source the money externally as I was hoping he would do. I know that he made efforts.
4.My husband's lawyers have informed me, and I do verily believe that
4.1the Defendants have been invited to agree to orders being made formally extending the time for making the payment into court so that the case can proceed.
4.2the Defendants have refused to agree to any extensions to allow the case to proceed and have instead applied to have the case dismissed.
5.I am happy to further increase the mortgage debt against the family home to raise the required security amount provided I know that the case will then proceed after that. I am a bank employee with NAB and I have made inquiry and I am confident I can do it within a period of two months if not earlier.
6.In other words, if my husband is given an extension of time to put up the security and the case is not dismissed, I am prepared to put up the security, and the reason that I have not arranged to have the security paid into Court is that I was concerned about being in a position (which I don't wish to be in) where the money is paid into court only for the said Defendants to then continue with their application to dismiss the case, which if successful would mean that the money paid into court would then be used to pay the Defendants [sic] costs.
That is the full content of the evidence relied upon by Mr Marinis and the second plaintiff in resisting the present dismissal application.
During arguments at the hearing of the dismissal application, counsel for the plaintiffs indicated that aligned to the changes reflected under the minute of reamended statement of claim that the second plaintiff, the corporation Sports Marketing Agency Pty Ltd, may cease to be a continuing plaintiff in the action (although the amended substituted pleading as submitted does not show that future departure in explicit terms).
No evidence has been put before the court by the plaintiffs other than through the affidavit of Mrs Marinis. In particular, Mr Marinis has not provided any explanation as to his efforts (if any) to obtain the security (about which his wife gives only a non‑specific hearsay comment seen at par 3 of her affidavit).
In circumstances where an indulgence (ie, seven weeks more time) is being sought by way of further time to provide the ordered security, it was incumbent upon Mr Marinis to provide some personal explanation detailing any efforts he had made since 9 November 2018 towards obtaining the ordered security amounts. Indeed, he ought to have explained what had changed after the advice the court received -which was presumably provided on instructions by him to his lawyers under Mr Galic's letter of 28 February 2019 to the court - then referring to security being able to be provided by a third party secured against property. Counsel for Mr Marinis endeavoured to provide an explanation about that from the bar table but objection was rightly taken. Enough was said, however, prior to the objection to inform me that the third party providing security then alluded to in the 28 February 2019 letter was not from Mrs Marinis. She appears to have emerged only at the eleventh and a half hour, effectively as the plaintiffs' security providing option of last resort.
As I indicated to counsel for the plaintiffs at the hearing of the dismissal application, I hold very deep reservations over Mrs Marinis being prevailed upon by her husband to offer this security. In the first place, there is no indication apparent to me that she has received a full, neutral and proper explanation about the issues arising in and the merits of the present action by her husband and the second plaintiff and its overall prospects of success - as she should have in her position.
In particular, at par 2 of her affidavit she only refers to a security amount of $75,000 - for circumstances where my 9 November 2018 order had ordered security in the amount of $150,000 in two $75,000 tranches. I am unable to assess Mrs Marinis' affidavit as indicating any basis to see that the full $150,000 security amount as ordered might be obtained effectively against whatever residual equity she holds in her property.
Second, and more fundamentally, I hold a deep concern that Mrs Marinis has not received any independent legal advice about her risk and exposure position, as plainly she ought have, where asked to provide security under present circumstances. I will render some more observations about the need for that to occur and what she should be provided with (at minimus) in due course.
Some case law
In Trafalgar West Investments Pty Ltd as Trustee for the Trafalgar West Investments Trust v Superior Lawns Australia Pty Ltd [No 9] [2016] WASC 68 (Trafalgar West [No 9]) I discussed at [14] - [21] some of the case authorities in this area concerning a potential dismissal of a plaintiff's action for circumstances where there had been a failure to provide security for costs under an order made requiring security. At [21], I made reference to McKerracher J's decision in Capital Webworks Pty Ltd v AdultShop.Com Ltd [2008] FCA 423. There his Honour ultimately issued a springing order dismissing those proceedings, but allowing a period of time for his orders to 'hover' before they took effect. See also the elaboration of that decision at [44] of Trafalgar West [No 9].
At [14] of Trafalgar West [No 9] I also mentioned the key principles upon such a dismissal application as they had been identified by Einstein J in the New South Wales decision of Idoport Pty Ltd v National Australia Bank [2002] NSWSC 18 [24]. There his Honour referred to the key factors to be weighed as a matter of principle in such an evaluation, including:
(a)the period that has elapsed since security was ordered;
(b)the fact that the plaintiff has been on notice of an application for dismissal;
(c)the seeming inability of the plaintiff to further fund the proceedings;
(d)the prejudice to the defendants; and
(e)the position of the court.
The 'Idoport' factors weighed presently
Here, the period that has elapsed since my first making of my security for costs orders of 9 November 2018 now exceeds seven months. These two plaintiffs have been on notice of a potential application to dismiss the action for failure to meet the first tranche of security since the directions hearing of 31 January 2019, and then of the application itself, from the time of the making of the dismissal application by the first, second and third defendants at 10 April 2019.
In terms of the ability of the plaintiffs to fund the proceedings, the evidence indicates a positive inability of these plaintiffs to do so - other than by reference to asking Mrs Marinis to increase her mortgage debt secured against her home, a situation that looks less than satisfactory. That is particularly so, given the reservations I have addressed earlier concerning her position as regards what appears to be both an inadequate explanation to her or at least an inadequate understanding on her part of her husband's action in this court and to the lack of any independent legal advice given to her concerning her exposures in taking the path she foreshadows presently.
In terms of prejudice to the defendants, the position since the decision of the High Court in Aon Risk Services Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175 is that considerations adversely bearing upon defendants under drawn out commercial litigation now form part of a wider landscape of considerations to be weighed overall as regards prejudice delivered by being tied into such litigation. Here some matters sought to be ventilated as alleged misleading and deceptive conduct against the defendants under the proposed minute of reamended substituted statement of claim hark back to events of 2011 - concerning an email sent by the first defendant to Australian Football League (AFL) clubs on 11 October 2011. The alleged ramifications of that 2011 email are in issue. Subsequent alleged misleading and deceptive conduct relied upon concerns communications about Mr Marinis' inability to negotiate over AFL club contracts with three AFL registered players back in 2012 and 2014.
There is an undeniable forensic truth that, as time marches by, the potential prejudice to defendants in contested fact litigation increases, due to diminished witness recall of past events and the prejudice that adds to reliably marshalling factual evidence to counter what are presently early and still somewhat sketchy pleaded allegations. This is particularly the case in relation to serious but vague allegations raised over the defendants' alleged participation in the torts of injurious falsehood and unlawful conspiracy to injure Mr Marinis.
This litigation is still essentially in its relative infancy, bearing in mind the presently proposed changes by way of a substituted reamended statement of claim. That is so notwithstanding that the action was commenced in 2016. The pace is glacial. In making that observation I do not attribute all responsibility to the plaintiffs, given some time that was consumed by attempted resolution efforts at mediations. But, since 2018, from when I have been involved in the attempted case management of this litigation, I must direct the substantial component of blame for the pedestrian pace of the litigation at the plaintiffs' doorstep.
Relevant to the end position of the court on this discretionary evaluation towards dismissal seems to me to be the somewhat threadbare and still undeveloped nature of a late would‑be repleaded case concerning Mr Marinis' statutory and common law claims. The essence of Mr Marinis' pleaded grievance concerning an 11 October 2011 email and some subsequent verbal communications made to three respective AFL registered players in 2012 - 2014 concerning Mr Marinis arises out of him not being an accredited AFL player agent and so, not authorised to engage in negotiation of contracts between a player and an AFL club seemed to be largely an exercise in terminology. The real 'nub' of Mr Marinis' pleaded grievances seems to rest more in something akin to a defamatory cause of action over damage asserted to his reputation rather than a true misleading and deceptive conduct damage. The grievance is pursued despite an explicit double reference in the 11 October 2011 email to that communication specifically being in respect of Mr Marinis' inability to represent a player in contractual negotiations involving the AFL player (something that is not contested).
The point seeming to aggrieve Mr Marinis (see par 12 of the proposed substituted reamended statement of claim) is that the email communication he would say carried the unstated adverse imputation against him that Mr Marinis had in the past so acted and had thus breached cl 26.4 of a collective bargaining agreement - ie, by wrongly conducting such player contractual negotiations - conduct which he denies.
But reaching that adverse meaning against his reputation seemed to me to be a considerable 'stretch' as regards the brief text of the 11 October 2011 email, or the subsequent verbal communications by the first defendant and the third defendant concerning the three AFL registered players and their club contracts. This, it must be remembered, is not a defamation action. It is too late for that from a timing perspective. The present action is for alleged misleading and deceptive conduct and it is hard to see any of the AFL clubs being misled vis-a-vis Mr Marinis by the explicit terms of the 11 October 2011 email dealing explicitly and only with his lack of authorisation at the time to personally negotiate an AFL player's club contract. The pleading of Mr Marinis would seem to to contend that the email should have gone on to say the Mr Marinis could do other things or that he could employ agents who could do the AFL negotiations for players. But this is a 'stretch' as well.
Moreover, the recent refashioning of the damages plea seen under par 36 of the proposed reamended pleading as regards alleged damage to Mr Marinis seems to display a somewhat unprincipled lumping together of the four disparate acts (across 2011 - 2014) of alleged misleading and deceptive conduct - causing (somehow) the same end damage to Mr Marinis.
None of that, of course, is to render any final determination concerning the ultimate merits of this action at trial. However, for my present task perspective of evaluating possible prejudice to the plaintiffs on this dismissal application, it is clear that, even viewing the presently proposed reamended repleading(s) of the statement of claim, that the action, at least on paper, displays itself as being a marginal looking action in terms of its prospects and ultimate merits.
That less than optimistic assessment will be weighed as a factor in the overall balance in terms of my ultimate disposition of the present application.
Disposition
I accept the submission of the first, second and third defendants that this court's inherent power to dismiss the action for failure to meet the Tranche 1 security for costs order made on 9 November 2018 does not necessarily need to be preconditioned on a basis of a further opportunity granted under the terms of a springing order before the plaintiffs' action might be legitimately dismissed. But here, in the end, I am persuaded that I should allow another month of opportunity to the plaintiffs under such a springing order. The interests of justice, particularly access to justice considerations in terms of courts being cautiously reluctant to deny a litigant a fair opportunity to get their day in court in order to have the final merits of their case determined, lead me to that position. I am also alive to the consideration of not making the plaintiffs suffer for what I assess as the somewhat desultory performance of the lawyers of record to date (counsel excluded). The plaintiffs should, I feel, receive a further period of four weeks from the delivery of these reasons to redress the ongoing default. That is enough time, I assess, for them to get their house in order, as regards a compliance with the Tranche 1 security.
I am prepared to allow the plaintiffs that further period of four weeks. But I will allow it only on the basis that a springing order will issue to immediately strike out the plaintiffs' existing amended statement of claim and to automatically enter a self-executing judgment that dismisses the plaintiffs' present action against the first, second and third defendants with costs - in the event that the Tranche 1 security is not provided within that time frame (ie, by 4.00 pm WST on Friday, 19 July 2019). I reach that position essentially on the basis that over seven months has now elapsed since the making of my 9 November 2018 orders. That is far too long. Further, the only prospect of security on the horizon as regards a tranche of $75,000 being received is offered from Mrs Marinis increasing her mortgage debt over her property.
The further period of four weeks is obviously not the two‑month period to which Mrs Marinis refers in par 5 of her affidavit. But that period as mentioned by her was unexplained and looked arbitrary in any event. Here, counsel for the plaintiffs had asked for seven weeks. But that lesser requested period also carried with it no empirical derivation. In all the circumstances, I am only prepared to allow the further period of four weeks from the publication of these reasons and on the basis of a self-executing springing order.
I will allow the extra four weeks on the basis that that is a sufficient opportunity for Mrs Marinis to be provided with a proper explanation about the full ramifications of her husband's litigation and, critically, for her to receive some fully independent legal advice before committing to any further increase in the mortgage debt against her property in order to assist her husband.
To assist Mrs Marinis, I will provide to all parties, but particularly for the solicitors for the plaintiffs, a copy of the transcripts of the proceedings of 9 November 2018, the directions hearing of 31 January 2019 and the dismissal application argument of proceedings conducted before me on 12 June 2019. I require a written undertaking from the lawyers of record for the plaintiffs within the next seven days that those materials, along with a copy of these reasons, will be provided to Mrs Marinis immediately and will be signed for by her - prior to her committing to increase her mortgage debt against her property in the fashion explained in her affidavit submitted.
On the basis of the court receiving that written undertaking from the plaintiffs' lawyers, I propose to order in the following terms; namely, that unless by 4.00 pm WST on 19 July 2019 the plaintiffs cause the amount of $75,000 to be paid into court to meet the requirements of order 2(a) of the court's previous order of 9 November 2018, that the plaintiffs' amended statement of claim filed 6 April 2018 will then be immediately struck out as against the first, second and third defendants and judgment will be automatically entered on a self-executing basis against the plaintiffs, dismissing their action against the first, second and third defendants at that time. Upon that event coming to pass, all other questions concerning costs and ancillary matters will be reserved.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
DW
Associate to the Honourable Justice Martin21 JUNE 2019
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