Martins v A and a Martins Pty Ltd

[2016] FCA 953

FEDERAL COURT OF AUSTRALIA

Martins v A & A Martins Pty Ltd [2016] FCA 953

File number:

ACD 110 of 2013

Judge:

GRIFFITHS J

Date of judgment:

12 August 2016

Catchwords:

PRACTICE AND PROCEDURE – whether orders can and should be varied under r 39.04 of the Federal Court Rules 2011 (Cth) when there is a mistake by a party or legal representative to the proceeding.

Legislation:

Federal Court Rules 2011 (Cth), rr 26, 26.12, 26.12(7), 39.04

Cases cited:

De L v Director-General Department of Community Services (NSW) and another (No. 2) [1997] HCA 14; 190 CLR 207

L Shaddock and Associates Pty Ltd v Parramatta City Council (No. 2) [1982] HCA 59; 151 CLR 590

Date of hearing:

11 August 2016

Registry:

New South Wales

Division:

General Division

National Practice Area:

Commercial and Corporations

Sub-area:

Commercial Contracts, Banking, Finance and Insurance

Category:

Catchwords

Number of paragraphs:

12

Counsel for the Applicant:

Mr P Walker SC

Solicitor for the Applicant:

Aulich Civil Law

Counsel for the Respondents:

With leave of the Court Ms Lurdes Martins appeared on behalf of the Respondents

ORDERS

ACD 110 of 2013

BETWEEN:

RUTH ELIZABETH MARTINS

Applicant

AND:

A & A MARTINS PTY LIMITED

First Respondent

PRIMAVERA HOLDINGS PTY LIMITED (ACN 080 185 244)
Second Respondent

MAPLES WINTERVIEW PTY LIMITED (ACN 112 495 879)
Third Respondent

PRIMAVERA VISTA PTY LIMITED (ACN 080 158 217)
Fourth Respondent

JUDGE:	GRIFFITHS J
DATE OF ORDER:	12 AUGUST 2016

THE COURT ORDERS THAT:

1.Order 2 of the orders dated 3 August 2016 be varied to read:

Pursuant to rule 26.12(7) of the Federal Court Rules 2011 (Cth) there be no order as to costs.

2.There be no order as to costs of the interlocutory application dated 5 August 2016.

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

REASONS FOR JUDGMENT

GRIFFITHS J:

1. On 3 August 2016, orders were made in these proceedings.  The orders that were made were that:

   1.        The proceeding be discontinued.

   2.Pursuant to rule 26.12 of the Federal Court Rules 2011 (Cth) the applicant is liable to pay the costs of the respondents, as agreed or assessed.

2. On or about 5 August 2016, the applicant filed an interlocutory application in which she sought to vary order 2 of those orders so as to state that there be no order as to costs.  In support of that interlocutory application the applicant relied upon an affidavit prepared by her solicitor Ms Lisa Barlin.  Mr Philip Walker SC of counsel appeared for the applicant.  Ms Lurdes Martins sought leave to appear on behalf of the four respondent corporations. 

3. Leave was required because Ms Martins is not legally qualified.  The application was not opposed by the applicant.  I granted leave in circumstances where Ms Martins is a director of two of the respondent companies and indicated to the Court, as is readily apparent, that she is familiar with the proceedings. 

4. The affidavit of Ms Barlin had annexed to it a copy of a deed of settlement dated 23 March 2015 between the parties.  The deed related to corporations proceedings which were initiated in this Court on 8 November 2013 as well as to contested probate proceedings which had been commenced in the Supreme Court of the Australian Capital Territory and were subsequently transferred to this Court on 2 May 2014.

5. The deed was signed not only by the applicant but also by the four respondent corporations.  Clause 7(d) of the deed deals with the topic of the disposal of the proceedings.  Clause (d) states:

   The parties consent to discontinuance of the Contested Probate Proceedings and Corporations Proceedings with no orders as to costs.

6. In her affidavit, Ms Barlin deposes that when she reviewed a copy of the orders that were made on 3 August 2016 she realised that she had made a mistake, because the notice of discontinuance which she had forwarded to the Court did not correctly reflect the agreed terms in the deed.  Ms Barlin had signed a notice of discontinuance on behalf of the applicant on 10 June 2016 and it was this notice of discontinuance which was filed electronically on or about 30 June 2016. 

7. Ms Barlin deposes that she omitted to have regard to r 26 of the Federal Court Rules 2011 (Cth) (Federal Court Rules) when she forwarded the notice of discontinuance. Rule 26.12 of the Federal Court Rules provides that unless a notice of discontinuance provides otherwise, an applicant is liable to pay the costs of respondents, as agreed or assessed. 

8. It is evident that the orders that were made on 3 August 2016 have not yet formally been entered, but even if they were, it does not deny the Court the power under both the Federal Court Rules and in its inherent jurisdiction to vary orders.  Although the respondents suggested that they had understood that the orders had been entered formally there is no evidence that this is the case.

9. Ms Barlin deposes to a conversation which she had on 5 August 2016 at about 1.45pm with Ms Kobi Fogg of the Federal Court of Australia, in which Ms Barlin asked Ms Fogg whether the orders had been entered and Ms Fogg responded by saying “no”. Ms Barlin deposes that she then told Ms Fogg that she would be filing an application that afternoon and could Ms Fogg please make a note on her file that no order should be entered because such an application would be made today.  Proceeding on the basis that the order has not yet been formally entered, the Court’s power under the Federal Court Rules to vary an order are set out in r 39.04, and are in the following terms:

   39.04   Varying or setting aside a judgment or order before it has been entered.

   The Court may vary or set aside a judgment or order before it has been entered. 

10. It is well settled, as the applicant has contended, that a mistake on the part of a legal representative, or indeed by a party, may provide a sufficient basis for varying an order which has not been entered.  The applicant drew the Court’s attention to a series of cases to that effect, which include L Shaddock and Associates Pty Ltd v Parramatta City Council (No. 2) [1982] HCA 59; 151 CLR 590. I would also mention the High Court’s decision in a subsequent case, De L v Director-General Department of Community Services (NSW) and another (No. 2) [1997] HCA 14; 190 CLR 207. In that decision, Toohey, Gaudron, McHugh, Gummow and Kirby JJ said the following at 215 (footnotes omitted):

    The power of this Court to reopen its judgments or orders is not in doubt. The Court may do so if it is convinced that, in its earlier consideration of the point, it has proceeded "on a misapprehension as to the facts or the law", where "there is some matter calling for review" or where "the interests of justice so require". It has been said repeatedly that a heavy burden is cast upon the applicant for reopening to show that such an exceptional course is required "without fault on his part", ie without the attribution of neglect or default to the party seeking reopening. By such expressions of the power to reopen final orders, courts seek to recognise competing objectives of the law. On the one hand, there is the principle of finality of litigation which reinforces the respect that should be shown to orders, final on their face, addressed to the world at large and upon which conduct may be ordered reliant upon their binding authority. On the other hand, courts recognise that accidents and oversights can sometimes occur which, unrepaired, will occasion an injustice.

11. In my view, having regard to the evidence given by Ms Barlin and having regard to the clear terms of clause 7(d) of the deed, I am satisfied that there has been an accident or an oversight which, unless remedied, will create an injustice, namely, a failure to give effect to the clear intention of the parties that the proceedings would be discontinued without there being any order as to costs.  For those reasons, I propose to vary order 2, which was made on 3 August 2016, such that it read:

    Pursuant to rule 26.12(7) of the Federal Court Rules 2011 (Cth) there be no order as to costs.

12. The applicant did not seek costs in relation to the interlocutory hearing dated 5 August 2016. Accordingly, there will be no order for costs for this interlocutory hearing.

I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths.

Associate:

Dated:        12 August 2016