Mohareb v Palmer (No 2)

[2020] NSWCA 324

Court of Appeal

Supreme Court

New South Wales

• Summary available

Medium Neutral Citation:

Mohareb v Palmer (No 2) [2020] NSWCA 324

Hearing dates:

5 March 2020

Date of orders:

11 December 2020

Decision date:

11 December 2020

Before:

Basten JA at [1];
McCallum JA at [94];
Simpson AJA at [95]

Decision:

1.   Leave granted to appeal against the orders of 7 August 2019.

2.   Appeal allowed in part.

3.   Order 2 be set aside.

4.   Appeal otherwise dismissed.

5.   No order as to costs.

Catchwords:

CIVIL PROCEDURE — Parties — Vexatious litigants – Vexatious Proceedings Act2008 (NSW) – s 6 – meaning of “vexatious proceedings” – s 8(1) – meaning of “frequently instituted or conducted vexatious proceedings” – assessment of frequency

CIVIL PROCEDURE — Parties — Vexatious litigants – exercise of discretion – balance between access to the processes of the law and restraint of unwarranted exercise of that access

CIVIL PROCEDURE — Hearings — Procedural fairness – expansion of orders as compared to those sought – making an order in terms not foreshadowed during or after the hearing – no opportunity for parties to be heard

Legislation Cited:

Civil Procedure Act 2005 (NSW), ss 56, 61, 73

Crimes Act 1900 (NSW), ss 326, 327, 338

Defamation Act 2005 (NSW), s 23

District Court Act 1973 (NSW), s 203

Federal Court of Australia Rules 1976 (Cth)

Judiciary Act 1903 (Cth), s 35A

Legal Profession Act 2004 (NSW) ss 345, 498

Legal Profession Uniform Conduct (Barristers) Rules 2015, r 64

Legal Profession Uniform Law Application Act 2014 (NSW), ss 62, 86; Sch 2, cll 1, 2, 4

Local Court Act 2007 (NSW), s 40

Supreme Court Act 1970 (NSW), ss 84, 75A, 101

Supreme Court Rules 1970 (NSW), Pt 55

Uniform Civil Procedure Rules 2005 (NSW), r 36.16

Vexatious Proceedings Act2008 (NSW), ss 4, 6, 8, 14-16

Cases Cited:

Attorney General of New South Wales v Croker [2010] NSWSC 942

Attorney-General v Wentworth (1988) 14 NSWLR 481

Fox v Percy (2003) 214 CLR 118; [2003] HCA 22

Be Financial Pty Ltd atf Be Financial Operations Trust v Das [2012] NSWCA 164

Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd (2013) 250 CLR 303; [2013] HCA 46

Kowalski v Mitsubishi Motors Australia Ltd (2011) 198 FCR 153; [2011] FCAFC 159

Glover v Australian Concrete Floors Pty Ltd [2006] NSWSC 503

Hambleton v Labaj [2010] QSC 124

Mahmoud v Attorney-General of New South Wales [2017] NSWCA 12

Mohareb v Palmer (No 2) [2015] NSWDC 141

Mohareb v Palmer (No 2) [2018] NSWSC 400

Mohareb v Palmer (No 3) [2016] NSWDC 38

Mohareb v Palmer (No 4) [2017] NSWDC 127

Mohareb v Palmer (Supreme Court (NSW), Fagan J, 2 September 2019, unrep)

Mohareb v Palmer [2015] NSWCA 369

Mohareb v Palmer [2015] NSWDC 134

Mohareb v Palmer [2016] NSWCA 378

Mohareb v Palmer [2017] NSWCA 281

Mohareb v Palmer [2017] NSWSC 1491

Mohareb v Palmer [2018] HCASL 18

Mohareb v Palmer [2018] NSWCA 220

Moss v McIlveen [2011] NSWCA 77

Nader Mohareb; Matthew Palmer v Nader Mohareb NSD 1760 of 2017

National Australia Bank Ltd v Freeman [2006] QSC 86

Official Trustee in Bankruptcy v Gargan(No 2) [2009] FCA 398

Palmer v Mohareb [2019] NSWSC 975

Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45

Potier v Attorney-General in and for the State of New South Wales (2015) 89 NSWLR 284; [2015] NSWCA 129

R De W Kennedy (Finance) Pty Ltd v Ley; Ley v Scarff (Supreme Court (NSW), Holland J, 29 March 1978, unrep)

Robinson Helicopters Company Incorporated v McDermott [2016] HCA 22; (2016) 90 ALJR 679

Singh v The Owners Strata Plan 11723 [2013] NSWSC 1595

Smith v New South Wales Bar Association (1992) 176 CLR 256; [1992] HCA 36

Soden v Kowalski [2011] FCA 318

Spencer v The Commonwealth (2010) 241 CLR 118; [2010] HCA 28

The Attorney General for the State of New South Wales v Mohareb [2016] NSWSC 1823

Viavattene v Attorney-General(NSW) [2015] NSWCA 44

White Industries Australia Limited v Federal Commissioner of Taxation (2007) 160 FCR 298; [2007] FCA 511

Category:

Principal judgment

Parties:

Nader Mohareb (Applicant)
Matthew Palmer (First Respondent)
Attorney-General of NSW (Second Respondent)

Representation:

Counsel:
In person (Applicant)
J Emmett/R McEwen (Second Respondent)

Solicitors:
In person (Applicant)
Crown Solicitor’s Office (Second Respondent)

File Number(s):

2019/267950

 Decision under appeal 

Court or tribunal:

Supreme Court of NSW

Jurisdiction:

Common Law Division

Citation:

Palmer v Mohareb [2019] NSWSC 975

Date of Decision:

7 August 2019

Before:

Fagan J

File Number(s):

2018/217228

HEADNOTE

[This headnote is not to be read as part of the judgment]

Mr Matthew Palmer (the respondent) and Mr Nader Mohareb (the applicant) were once neighbours who lived on Scotland Island off the northern beaches of Sydney. A dispute arose in which Mr Mohareb alleged that, on or around 21 July 2014, Mr Palmer and Mrs Palmer had published material that defamed Mr Mohareb on a Facebook page maintained by the Scotland Island Community. This dispute gave rise to eleven proceedings between the parties.

On 15 August 2018 Mr Palmer sought orders pursuant to the Vexatious Proceedings Act 2008 (NSW) (VP Act) that Mr Mohareb be prohibited from instituting proceedings against Mr Palmer without leave. Mr Palmer contended that eleven proceedings commenced against him by Mr Mohareb were vexatious. On 7 August 2019 the primary judge found that 10 of the proceedings were vexatious and made orders prohibiting Mr Mohareb from instituting any proceeding against Mr Palmer in NSW (Order 1) and from instituting any new proceeding against any person in NSW (Order 2). Mr Mohareb sought leave to appeal against those orders.

The issue on appeal was whether the eleven proceedings instituted by Mr Mohareb against Mr Palmer, or against Mr Palmer and Mrs Palmer, between 2015 and 2018 were vexatious within the meaning of s 6(c) of the VP Act, that is, were instituted or pursued without reasonable ground.

The Court allowed the appeal in part but (by majority) (Simpson AJA, McCallum JA agreeing) otherwise dismissed the appeal, holding:

Per Simpson AJA:

1. Five of the proceedings (the first to fourth and tenth) were not instituted without reasonable ground and therefore were not vexatious: at [139]-[168], [212]. Five of the proceedings (the fifth to ninth) were instituted without reasonable ground and therefore were vexatious: at [170]-[222]. The requirement of frequency in s 8(1) of the VP Act was satisfied: at [223]-[224].

2. Where a vexatious proceedings order is contemplated, the competing interests of access to justice and preservation of the integrity of the system for the benefit of the majority require a balance to be struck. No simple test for determining whether a proceeding has been instituted without reasonable ground has emerged: at [116]-[126].

R De W Kennedy (Finance) Pty Ltd v Ley; Ley v Scarff (Supreme Court (NSW), Holland J, 29 March 1978, unrep); Attorney-General v Wentworth (1988) 14 NSWLR 481; Soden v Kowalski [2011] FCA 318; Kowalski v Mitsubishi Motors Australia Ltd (2011) 198 FCR 153; [2011] FCAFC 159; Fox v Percy (2003) 214 CLR 118; [2003] HCA 22; Robinson Helicopters Company Incorporated v McDermott [2016] HCA 22; (2016) 90 ALJR 679; Lee v Lee; HSU v RACQ Insurance Limited; Lee v RACQ Insurance Limited [2019] HCA 28; Kowalski v Mitsubishi Motors Australia Ltd; Attorney-General of New South Wales v Croker [2010] NSWSC 942; Singh v The Owners Strata Plan 11723 [2013] NSWSC 1595; Official Trustee in Bankruptcy v Gargan (No 2) [2009] FCA 398

1. Mr Mohareb’s s 338(1)(c) applications raised the novel question of whether perjury can be committed by silence, or by representation, which was found by the Court of Appeal to be a contention worthy of a grant of leave: [164]. The grant of leave strongly contradicts the proposition that that application and the subsequent application and appeal were instituted without reasonable ground: at [167].

Spencer v The Commonwealth (2010) 241 CLR 118; [2010] HCA 28; White Industries Australia Limited v Federal Commissioner of Taxation (2007) 160 FCR 298; [2007] FCA 511; Viavattene v Attorney-General (NSW) [2015] NSWCA 44

1. The orders permitted by s 8 of the VP Act are discretionary in nature. A balance is to be struck, between preservation of the fundamental right of access to the processes of the law on the one hand, and restraint of unwarranted exercise of that access, with its consequences on other parties to the litigation: at [228].

2. Order 2 as made by the primary judge was an expansion of the orders sought by Mr Palmer was not warranted and should be set aside: at [225]-[227]; see also [88]-[90] (Basten JA).

Per Basten JA:

6.    Seven of the proceedings (the first to fourth and eighth to tenth) were not instituted without reasonable ground and therefore were not vexatious: at [13]-[33], [48]-[62]. Three of the proceedings (part of the fifth and the sixth and seventh) were brought without reasonable ground and therefore were vexatious: at [34]-[47].

7. The power of the court to make a vexatious proceedings order is only engaged where the court is satisfied that the person has “frequently” instituted or conducted vexatious proceedings in Australia. Three vexatious proceedings did not engage the description of proceedings frequently instituted; even had there been five such proceedings the frequency criterion would not have been met: [74]-[81].

Attorney General of New South Wales v Croker [2010] NSWSC 942; National Australia Bank Ltd v Freeman [2006] QSC 86; Hambleton v Labaj [2010] QSC 124

Judgment

1. BASTEN JA: The applicant, Nader Mohareb, sought leave to appeal from a judgment of Fagan J in the Common Law Division making orders under the Vexatious Proceedings Act 2008 (NSW), prohibiting the applicant from initiating fresh proceedings, without leave of the court. [1]

   1. Palmer v Mohareb [2019] NSWSC 975 (“primary judgment”).

Background to proceedings

2. The history of proceedings between the applicant and the respondent dates back to 19 August 2014 when the applicant brought a claim in defamation in the District Court. The claim was founded on a poster placed in public areas around Scotland Island on Pittwater, where they both lived. [2] Although there were difficulties in pleading the claim, it was not suggested that that proceeding was instituted without reasonable grounds.

   2. Mohareb v Palmer [2015] NSWDC 134 at [7], [8], [17](a).

3. In fact, the proceedings were settled with the respondent agreeing to post an apology within 14 days on a Facebook page managed by the Scotland Island community. The proceedings were to be discontinued on that basis.

4. An apology was posted, but taken down the following day. Why it was taken down was a matter of dispute. Mr Palmer alleged that it was taken down by the moderator. That appears to have been the case, as the moderator had not been informed of the settlement agreement. The apology was then reinstated by the moderator, but removed, as the judge concluded, by the respondent. [3] The judge stated:

“All of the evidence points to Mr Palmer having done this, although he denied it when cross-examined by the plaintiff.”

3. Mohareb v Palmer (No 2) [2015] NSWDC 141 at [42].

5. The basis for this conclusion followed in part from the following material set out by the judge:

“[34]   Mr Palmer’s explanation of these events in his affidavit is that the administrators of the website wanted to remain anonymous:

‘11.   At or around 11:50 am on 28 April 2015 I had a further telephone conversation with Ms Carter in which Ms Carter said words to the following effect:

I have spoken to the person who identified himself as the administrator of the Facebook page, but they don’t want to be identified. They said they are aware of this matter. They want someone to write to them via Facebook Private Message, explaining that the apology is necessary as part of the settlement and giving the words of the apology, and then they’ll allow it.’

(Paragraph 11 of the Affidavit of William Jake Blundell affirmed 21 May 2015)

[35]   I am satisfied that at all relevant times the moderator was in fact Mr van Mierlo and that he had never sought to cloak himself with anonymity or refused to communicate with any party in this litigation.”

6. The judge also noted:

“[14]   Despite the absence of the apology on the site, on 15 April 2015 the solicitors for the plaintiff write requiring the plaintiff to sign and file a Notice of Discontinuance by 5 p.m. on 20 April 2015, failing which enforcement proceedings would be commenced. The plaintiff replied that the apology was not published on the Scotland Island Community Facebook page. The defendants’ legal representatives relisted the matter for 23 April 2015 before me. Mr Palmer swore an affidavit on 23 April 2015 which was relied upon at the directions hearing to demonstrate that the reason was the Scotland Island Community Facebook page moderators’ refusal to publish the apology (see Exhibit MP7).”

7. The apology was eventually posted, but not within the 14 day period provided by the deed. Mr Mohareb declined to discontinue the proceedings, but the judge ordered that they be dismissed.

Legislation

8. The Vexatious Proceedings Act confers power on the Supreme Court to make a “vexatious proceedings order” in relation to a person, “if satisfied that the person has frequently instituted or conducted vexatious proceedings in Australia”.

9. An order may be sought by the Attorney General, and by a person against whom vexatious proceedings have been brought: s 8(4). The term “proceedings” is defined broadly to include interlocutory applications, applications for leave to appeal, and appeals: s 4.

10. The term “vexatious proceedings” is defined, as follows:

6   Meaning of “vexatious proceedings”

In this Act, vexatious proceedings includes:

(a)   proceedings that are an abuse of the process of a court or tribunal, and

(b)   proceedings instituted to harass or annoy, to cause delay or detriment, or for another wrongful purpose, and

(c)   proceedings instituted or pursued without reasonable ground, and

(d)   proceedings that are conducted to achieve a wrongful purpose, or in a way that harasses, or causes unreasonable annoyance, delay or detriment, regardless of the subjective intention or motive of the person who instituted the proceedings.

The separate paragraphs of s 6 are not to be construed as “independent and self-contained categories”. [4] In many cases, a proceeding under consideration would be likely to fall within more than one of the s 6 categories.

4. Viavattene v Attorney General (NSW) [2015] NSWCA 44 at [14]; Mahmoud v Attorney General of NSW [2017] NSWCA 12.

11. By s 8(7) the orders that may be made are:

“(a)   an order staying all or part of any proceedings in NSW already instituted by the person,

(b)   an order prohibiting the person from instituting proceedings in NSW,

(c)   any other order that the Court considers appropriate in relation to the person.”

12. A person prohibited from instituting proceedings under s 8(7)(b) may apply to the Supreme Court for leave to institute proceedings: s 14(2).

First proceeding

13. What was described by the trial judge as the “first proceeding” was a notice of motion in the defamation proceedings, filed on 29 May 2015 seeking leave to prosecute Mr Palmer for perjury. In fact the “first proceeding” identified in the statement of particulars accompanying the respondent’s summons was the defamation proceeding which was settled. Mr Palmer complained that Mr Mohareb’s conduct had “imposed such a significant financial burden and unreasonable delay” that he (Palmer) “was forced to settle”. [5] This complaint was not relied on (or addressed) by the primary judge.

    5. Statement of Particulars, p 2, par 1a.

14. The issue addressed by the primary judge (the perjury application) was Mr Palmer’s “second proceeding”. The issue was dealt with briefly by Gibson DCJ in her judgment of 30 July 2015, stating:[6]

    6. Mohareb v Palmer (No 2) [2015] NSWDC 141.

“[80]   The precise acts of perjury are identified by the plaintiff as follows:

‘I have firm and irrefutable evidence that in his affidavit of 23 April 2015, Mr Matthew Palmer made false statement(s) on oath concerning a matter which is material to the proceedings, knowing the statement(s) to be false as well as not believing it to be true.’

[81]   The plaintiff has complained in correspondence about perjury. In his letter of 15 May 2015, the plaintiff stated that the administrator denied having initially refused to allow publication of the apology, and that the first defendant’s statements to the contrary were ‘false assertions under oath’, which was ‘a criminal offence’.

[82]   In fact this is what occurred and this allegation is without foundation.

[83]   Mr Mohareb was unable to identify with precision what evidence given by the first defendant today was perjury.”

15. The key point raised by the judge was that the moderator, Mr van Mierlo, had stated that he “initially” was responsible for taking the post down. The judge put that to Mr Mohareb in the course of submissions: [7]

“HER HONOUR: Well, you’ve given me one example from that correspondence which I’ve read and I’m satisfied that in fact what has happened is that Mr van Mierlo has indicated that he did in fact – you said that Mr van Mierlo denied that he had taken it off at all, and in fact Mr van Mierlo said he took it off and then when he realised he put it back on again.

PLAINTIFF: Correct.

HER HONOUR: Yes, but the thing is that’s not what you said in the letter. That was not evidence that amounted to perjury.

PLAINTIFF: What are you saying, sorry?”

7. Tcpt, 05/06/15, p 133(10)-(20).

16. Mr Mohareb then sought to draw attention to what appears to have been the respondent’s affidavit. It is a fair inference that the submission he was seeking to make related to the statements in the affidavit as to what happened after the apology was reinstated, evidence which the judge rejected in the passages set out above.

17. The manner in which Mr Mohareb presented his case was part of the complaint, but the finding that the proceeding was vexatious relied on a lack of reasonable grounds to institute proceedings (that is to file the notice of motion) under s 6(c). [8] The applicant’s case was that Mr Palmer falsely denied that he was responsible for taking down the apology after it was reinstated. The judge had made a finding of fact to that effect. In my view, the filing of the notice of motion was not without reasonable grounds.

    8. Primary judgment at [58].

18. In so far as the vexatious proceeding order was sought by reference to the filing of this notice of motion, that basis should have been dismissed.

19. The primary judge said that Mr Mohareb’s application “would inevitably have been dismissed on discretionary grounds even if he had been able to formulate a charge.”[9] That may be so, but it does not demonstrate that the application was made without reasonable grounds. The fact that he could not articulate the grounds when required to do so in the course of the hearing on 5 June 2015 does not mean there were no reasonable grounds. Objectively assessed, in my view there were.

    9. Primary judgment at [56].

Second proceeding

20. The second proceeding identified by the primary judge arose out of the dismissal of the notice of motion considered above. On 21 August 2015 the applicant filed a summons in this Court seeking leave to appeal from the dismissal of the notice of motion. He identified the nature of the case in the summons in the following terms:

“The applicant and the opponent [respondent] reached a settlement of the underlying proceedings that included publication of an apology by the opponent to the applicant on the Facebook page of the Scotland Island Community. When the apology was first posted, it was taken down by the moderator of the page. However, following correspondence between the moderator and the opponent, it was reposted sometime shortly before 8:48am on 2 April 2015. But at some time between 8:48am and 10:26pm on that day the apology was removed from the Facebook page again. Three weeks later, on 23 April 2015, as part of an application for an order pursuant to s 73 Civil Procedure Act for an order that the proceedings were settled, the opponent swore an affidavit in which he deposed to the fact that the apology was not on the Facebook page because the moderator had refused to allow it to be published on there. Her Honour concluded that this evidence was not false [sic].”

21. The last two words were clearly erroneous: the judge had not accepted the respondent’s evidence in that respect. The point was clearly articulated in submissions prepared by counsel in support of the application for leave to appeal.

22. The application for leave to appeal was heard on 24 November 2015. The summons was dismissed with costs. [10] The application was dismissed because it was said that the false statement in the respondent’s affidavit was not “and certainly was not sufficiently clearly, the subject of the application for leave”: at [15].

    10. Mohareb v Palmer [2015] NSWCA 369 (Meagher JA and Bergin CJ in Eq).

23. The conclusion that the application to this Court was without reasonable grounds is not, in my view, apparent on the face of the documents; nor does it appear from the judgment of this Court. The application was presented by counsel. The proposition that there were no grounds to support the application, and the implication that it was therefore hopeless, implies that counsel appearing for Mr Mohareb acted in contravention of his duty to the court. I see no reason to reach such a conclusion; while the refusal of the application was undoubtedly justifiable, the application itself was not brought without reasonable grounds.

24. The basis of this assessment of counsel’s duty should be explained. [11] Section 62 and Sch 2, cl 2(1) of the Legal Profession Uniform Law Application Act 2014 (NSW) provide that a legal practitioner (including a barrister[12] ) “must not provide legal services on a claim or defence of a claim for damages unless [he or she] reasonably believes on the basis of provable facts and a reasonably arguable view of the law that the claim or the defence … has reasonable prospects of success.” It was expressed to apply to appeals: cl 1(1). A contravention of this provision is “capable of being unsatisfactory professional conduct or professional misconduct”: Sch 2, cl 4(1). The provision was not new when it came into force on 1 July 2015, five months before the hearing of the leave application. [13]

    11. Cf Viavattene v Attorney-General (NSW) [2015] NSWCA 44 at [65] (Leeming JA).

    12. Schedule 2, cl 1(2).

    13. See Legal Profession Act 2004 (NSW) ss 345(1), 498(1)(a) (repealed).

25. It is not necessary to determine whether these provisions directly apply to a leave application, which involves satellite litigation to a claim for damages; the obligations they impose are closely related to those imposed by s 56 of the Civil Procedure Act 2005 (NSW), which controls satellite litigation,[14] and would be so understood by counsel.

    14. Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd (2013) 250 CLR 303; [2013] HCA 46.

26. The primary judge dealt with this proceeding in three paragraphs. The gravamen of the reasoning appears to be contained in the following proposition:

“[60] This application for leave to appeal from Gibson DCJ’s decision was, like the application at first instance, ‘instituted and pursued without reasonable ground’ within the meaning of s 6(c).”

If the original application was not a vexatious proceeding, the application for leave, presented by counsel, was not either.

27. There is a further reason for concluding that neither the first nor the second proceeding was vexatious. In 2016 the Attorney had brought proceedings under the Vexatious Proceedings Act against Mr Mohareb, relying in part on the first and second proceedings discussed above. The application was dismissed by Schmidt J. [15] Schmidt J held that the first and second proceedings were not vexatious proceedings. On one view, that issue was a matter of res judicata between the Attorney and Mr Mohareb. While it is true that the present proceedings were instituted by Mr Palmer, and not the Attorney, the judgment of Fagan J has been defended in this Court by the Attorney. The Attorney was joined on his own motion as the second respondent; he did not appear for Mr Palmer, but took over the defence of the judgment below. Even if that had not been so, it would arguably be an abuse of process for the putative victim, Mr Palmer, in fresh proceedings against Mr Mohareb, to have sought to rely upon the same proceedings as those relied upon unsuccessfully by the Attorney.

    15. Attorney General for the State of New South Wales v Mohareb [2016] NSWSC 1823.

28. The primary judge dismissed that concern on the basis of the specific grounds relied upon in s 6 of the Vexatious Proceedings Act and the fact that Schmidt J had determined the issue purely by reference to “the criterion of deliberate intent to harass or annoy”, referring to the following passage in the earlier judgment:

“[151] In order for it to be concluded that the pursuit of that allegation against Mr Palmer, which the Attorney has not suggested was groundless, was conducted ‘in a way so as to’ harass and annoy Mr Palmer, more must obviously be established than the mere making and pursuit of the application for leave, if it is not suggested that the allegation was groundless. In that event, s 6(c) would be engaged.”

29. No argument was put in this Court as to why the category of abuse of process identified in Port of Melbourne Authority v Anshun Pty Ltd [16] would not operate in the present circumstances. In other words, it was open to the Attorney to have sought to characterise the proceedings as vexatious on any basis found in s 6 of the Act; to choose a specific ground as opposed to another ground should not allow the proceedings to be reagitated on some other ground if initially unsuccessful. Mr Palmer relied on all four limbs of s 6; the primary judge chose a limb not agitated in the earlier application.

    16. (1981) 147 CLR 589; [1981] HCA 45.

30. Were they not dismissed on the merits as not shown to be vexatious, the first and second proceedings should have been dismissed on the basis that it was an abuse for Mr Palmer to run a case which sought to reagitate an issue which had already been disposed of in Mr Mohareb’s favour in the proceedings brought by the Attorney.

Third and fourth proceedings

31. The third proceeding concerned a further application in the District Court for leave to prosecute Mr Palmer for perjury, correcting the earlier error identified as a failure to provide proper particulars. The fourth proceeding was an appeal to this Court from the judge’s refusal to grant leave with respect to the particularised matter. The applicant’s case before Gibson DCJ was presented by counsel. Again, to conclude that the proceeding was groundless implied that counsel was probably in breach of his duty to the court in presenting the case. Caution should be adopted in assessing the commencement of proceedings as so fundamentally misconceived as to warrant the conclusion that they were groundless. [17]

    17. Cf primary judgment at [76].

32. This Court granted leave to appeal. The grounds on which leave are granted are well understood: they require that there be an issue of principle involved, or that the alleged error be more than reasonably arguable and that failure to intervene would give rise to a miscarriage of justice. [18] The primary judge considered that the court would have refused leave if it had “received more assistance”. That proposition may have carried weight if, on the hearing of the appeal, the Court had revoked the grant of leave on the basis that it was made under a misapprehension. In fact, the Court made no such order; [19] rather, in considering costs, the Court stated:

“[56]   The respondent sought the costs of the appeal on an indemnity basis. No argument was addressed as to why indemnity costs should be ordered. Whilst the appellant has failed on the appeal, the Court determined that leave to appeal should be granted and the appellant did not engage in any undue prolongation of the appeal process.

[57]   The Court well appreciates that this is the second time that the appellant has brought proceedings in the District Court seeking leave to prosecute the respondent for perjury. However, his failure on the first occasion was the absence of proper particulars. Leave to appeal from that decision was refused. This is the first occasion that the appellant has had a full hearing of an appeal and the first occasion that there has been a full explication of why it is considered that his appeal must fail.

[58]   In those circumstances, we do not consider this an appropriate case in which to order indemnity costs on the appeal. The appeal should be dismissed with costs, including the costs of the summons for leave to appeal.”

18. Be Financial Pty Ltd atf Be Financial Operations Trust v Das [2012] NSWCA 164 at [32]-[39].

19. Mohareb v Palmer [2016] NSWCA 378 (Beazley P, Meagher and Leeming JJA).

33. In these circumstances, I agree with Simpson AJA that the third and fourth proceedings were not shown to be vexatious.

Fifth proceeding

34. The fifth proceeding involved two motions in the District Court. The motion filed on 13 February 2017 sought leave to prosecute two further charges of perjury against Mr Palmer, arising out of evidence given in the course of the earlier proceedings, following the settlement agreement, on 5 June 2015. The first charge related to evidence the respondent gave in cross-examination as to his instructions to his legal representatives in relation to a Facebook messaging conversation he had had with the moderator of the page. The second matter concerned Mr Palmer’s denial on oath as to knowing who had removed the apology from the page and his denial that it was he who did so. [20] As Gibson DCJ explained, the difference from the earlier proceedings was that there was no longer reliance upon the respondent’s affidavit, but rather his answers in the witness box. [21]

    20. Mohareb v Palmer (No 4) [2017] NSWDC 127 at [32].

    21. Ibid at [33].

35. As the judge noted, the applicant’s submissions that those passages were false and must have been known to be false were “confirmed by the findings in [her earlier] judgment that, in circumstances where I accepted Mr Van Mierlo’s evidence over that of the [respondent] as to who removed the post.”[22]

    22. Ibid at [40], referring to the 2015 judgment.

36. It is true that, in her judgment of 4 March 2016, the judge found that omission from the affidavit prepared by the plaintiff’s legal advisors was “not a deliberate and positive statement on oath” and was made in circumstances where he told the court that “his instructions to the solicitors preparing this affidavit were to set out the entirety of the conversations and dealings.”[23] However, if it were the case that the respondent had lied in denying on oath that he had taken the Facebook post down after it had been reinstated by the moderator, it was at least implausible that he had earlier told his solicitors to include an admission, contrary to his later evidence, in his affidavit. It will be recalled, that in her judgment of 30 July 2015, the judge had recorded that she was “comfortably satisfied” that the respondent was responsible for removing the reinstated apology. In substance, the judge appears to have changed her view on the basis of evidence in relation to the operation of the Facebook page given in the 2016 proceedings. She also expressed considerable reservations about the adequacy of that evidence, and the absence of expert evidence as to how the site operated.

    23. Mohareb v Palmer (No 3) [2016] NSWDC 38 at [30].

37. Applying an objective test, the circumstances following the 2016 judgment removed any realistic basis for a successful prosecution for perjury. That material was available to the applicant when he commenced the proceeding by notice of motion in February 2017.

38. I would conclude that for these reasons, the application for leave to commence proceedings for perjury, identified in the notice of motion of 13 February 2017, was instituted without reasonable grounds.

39. The second motion the subject of the fifth proceeding was the application to refer the respondent to the Supreme Court on a charge of contempt of court. The notice of motion was filed on 12 May 2016 and was accompanied by an affidavit bearing the same date. The applicant alleged that, at about 11am on 1 April 2016 he had served by email a notice of intention to appeal relating to the defamation proceedings. At about 6pm on that day, he encountered the respondent in the Church Point car park and said that he was “verbally abused by the respondent and physically assaulted.” He stated that the reason for the physical assault was to intimidate him into ceasing to pursue his legal proceedings against the respondent.

40. The respondent filed a motion seeking to strike out the applicant’s motion on the basis that it failed to demonstrate “a nexus between the alleged assault and the alleged contempt.” That was presumably intended to mean that there was no evidence to support the inference of intimidation in relation to the legal proceedings. Gibson DCJ was satisfied that an assault had taken place and that the respondent had sent an email in reply which the judge described as “insulting and derogatory”. [24] With respect to the assault, the judge was satisfied that the assault had occurred but considered the parties largely equally to blame and was satisfied that “the assault was not for the purpose of intimidating the plaintiff into dropping his application for leave to appeal but from the misfortune of the chance encounter.” There were “insults traded between two angry men.”[25] She continued:

“[92] The plaintiff prolonged the encounter in question and enflamed it by his own conduct. The actual degree of physical contact was very slight and consisted of the plaintiff’s glasses being knocked off. The words spoken were words of insult on both sides, not words of intimidation. The circumstances of this incident do not warrant the serious step of a referral to the Prothonotary with the attendant use of valuable court resources for an incident of this comparatively minor nature: ss 56 – 62 Civil Procedure Act 2005 (NSW).

[93]   Accordingly, if I have erred in holding that no act capable of amounting to contempt of court occurred, I would exercise my discretion not to refer the first defendant.”

24. Mohareb v Palmer (No 4) at [79].

25. Mohareb v Palmer (No 4) at [90].

41. Although the judge was correct to refuse to refer the matter for the prosecution of a contempt, in circumstances where there was clearly a relationship between the respondent’s angry response and the continuation of the legal proceedings, I would not be satisfied that the application in the notice of motion was made in the absence of reasonable grounds. I do not consider that notice of motion, which was entirely separate from the application for leave to commence proceedings for perjury, was vexatious.

Sixth proceeding

42. The sixth proceeding involved the application for leave to appeal with respect to the dismissal of the two notices of motion constituting the fifth proceeding. In this Court, although in my reasons I expressed some concern for the formulation of the relevant finding,[26] leave was refused on the basis that it could not be said that the primary judge had misapplied the law and there was no reasonable likelihood that the Court would interfere with the order. [27]

    26. Mohareb (No 4) at [90].

    27. Mohareb v Palmer [2017] NSWCA 281 at [22].

43. As noted above, there is a different test for refusal of leave: an issue must be more than merely reasonably arguable to warrant a grant of leave. Accordingly, refusal of leave carries with it no necessary implication that the application was vexatious.

44. In the present case, the application did lack reasonable grounds; nevertheless, it did not constitute a serious example of vexatious proceedings.

Seventh proceeding

45. The seventh proceeding was an application to the High Court for special leave to appeal from the judgment of this Court which constituted the sixth proceeding. As the sixth proceeding was vexatious, it follows that the application for special leave to appeal should be similarly characterised. The application was rejected on the papers, the Court concluding that the decision of this Court was “plainly correct.”[28]

    28. Mohareb v Palmer [2018] HCASL 18 at [1].

46. The application, which in effect contained the summary of argument, set out in a reasoned fashion the applicant’s submissions as to why this Court was in error. Further, it expressly addressed the requirements of s 35A of the Judiciary Act 1903 (Cth): the criteria for a grant of special leave are frequently overlooked by unrepresented applicants.

47. The seventh proceeding was vexatious, but again not at the high end of the scale.

Eighth, ninth and tenth proceedings

48. The last three proceedings relied upon were all concerned with an attempt by Mr Palmer to enforce costs orders made against him in favour of the respondent. The costs in question involved one certificate relating to proceedings in the District Court, and a second relating to proceedings in this Court, and an amount for the costs of the assessment. The total was $12,905. On 30 March 2017 the applicant sought a review of the certificates. Section 86 of the Legal Profession Uniform Law Application Act 2014 (NSW) provides that an application for review suspends the operation of the costs assessor’s determination. Nevertheless, the certificates were filed in the Local Court on 5 May 2017, resulting in a judgment of that Court against the applicant. Four days later, on 9 May 2017 the respondent served a bankruptcy notice relying on that judgment.

49. Pursuant to Mr Mohareb’s application to set aside the judgment, orders were made on 26 May 2017 in the Local Court staying enforcement of the judgment pending the determination of the application for review of the costs certificates. Mr Mohareb considered that the order for a stay was a favourable outcome and sought costs of his motion. On the basis that he had sought to set the judgment aside, and the order made was a stay, which had not been sought, the magistrate declined to order costs.

50. The applicant’s motion in the Local Court was not said to be vexatious, and clearly was not. The respondent’s attempt to enforce the costs certificate whilst a review was pending, contrary to the effect of the legislative suspension of the operation of the determination, was arguably an abuse of process.

51. The actual order made in the Local Court was not before this Court. At one stage, the magistrate reserved the question of costs. Later she stated that because no stay application had been made it was not a case where costs were to follow the event in the applicant’s favour and she declined to make a costs order. The applicant was argumentative before the magistrate. Although he had not been given an opportunity to make submissions in support of his application for costs, that conduct was inappropriate, but did not involve vexatious behaviour.

52. The eighth proceeding was an application for leave to appeal to the Supreme Court from the failure to award costs. Being a matter relating only to costs, the appeal under the Local Court Act 2007 (NSW) to the Supreme Court required leave. The leave application was refused by Adamson J. [29]

    29. Mohareb v Palmer [2017] NSWSC 1491.

53. Mr Mohareb did not appeal the refusal to set aside the judgment in the Local Court, perhaps because both parties in the Local Court appeared to be satisfied that a stay would meet their respective interests. Adamson J noted the respondent’s position in the following passage:

“[28]   … It appeared from the transcript that Mr Palmer’s prime concern was to minimise further costs (which would have been required to be expended if the judgment had been set aside) and ensure that his position on interest was protected (which it was by the judgment).”

54. Without further consideration of the true effect of the statutory suspension of the effect of the determinations on which the judgment was based, which had come into effect before the certificates of determination were registered, it is not possible to say whether either of the propositions accepted by Adamson J was either legally correct or provided a basis to leave the proceeding on foot. For present purposes, the question is whether the cost of an appeal to the Supreme Court in respect of the costs which might have been available to an unrepresented applicant for a stay of a judgment in the Local Court was entirely disproportionate to the amount in issue. However, that issue was not raised, but objectively, for reasons noted below, there were reasonable grounds for seeking leave to appeal. In my view the eighth proceeding was not vexatious.

54. The hearing and judgment in the Common Law Division occurred on 1 November 2017. On 15 November 2017 the Federal Court dismissed the bankruptcy notice on the basis that, the assessor’s certificates being suspended, there was no debt owing at the time the notice was issued. That decision was unremarkable. Whether such an order should have been made by the Local Court, in the motion filed by the applicant in that Court, is a relevant issue.

55. On 15 November 2017 the applicant filed a notice of motion seeking to set aside the judgment delivered by Adamson J in the eighth proceeding. The motion constituted the ninth proceeding relied upon as vexatious.

56. The notice of motion was heard by Lonergan J in the Common Law Division and dismissed on 3 April 2018. [30] In the “particulars” provided by the applicant reliance was placed on the judgment of the Federal Court and the reasons given for setting aside the bankruptcy notice, namely that there was no debt owing. The particular continued:[31]

“3.   In view of the above finding by the Federal Court of Australia, none of the Manly Court orders made on 26th May 2017 were open to the Manly Court Magistrate to make them.”

30. Mohareb v Palmer (No 2) [2018] NSWSC 400 (“Mohareb v Palmer (No 2)”).

31. Mohareb v Palmer (No 2) at [14].

58. That may be understood as an appeal from the stay order, on the basis that there was no valid judgment to stay; that is, the judgment should have been set aside, as proposed in Mr Mohareb’s notice of motion. That this was intended was recorded by Lonergan J in the following statement:

“[25]   Whilst I understand Mr Mohareb is of the view that this provides a basis for ‘undoing’ all previous order[s], this circumstance provides no basis at all for setting aside the orders made by Adamson J on 1 November 2017.”

59. The dismissal of the motion was based on the proposition that Mr Mohareb’s reliance on Uniform Civil Procedure Rules 2005 (NSW), r 36.16 was “misconceived.”[32] That was because, Adamson J having determined a claim for relief and dismissed the whole proceedings, reopening was precluded by r 36.16(3). Disregarding how the case may have been presented, that conclusion was not correct. Rule 36.16(1) provides that the court may set aside or vary a judgment or order “if notice of motion for the setting aside or variation is filed before entry of the judgment or order.” Rule 36.16(3A) permits the court to exercise the power under subr (1) although the order has been entered, if a notice of motion for setting aside the order has been made within 14 days after entry. That appeared to have occurred, so that the Court at least had power pursuant to r 36.16(1) to reopen and vary orders made by it, although they finally determined the proceedings.

    32. Mohareb v Palmer (No 2) at [21].

60. The ninth proceeding, objectively assessed, did not lack reasonable grounds.

61. The tenth proceeding involved an application for leave to appeal from the judgment of Lonergan J. Mr Mohareb’s application for leave to appeal was unsuccessful, but this Court accepted the reasoning set out above for concluding that Lonergan J had erred in holding there was no power to intervene. This Court concluded that if leave to appeal were granted, “it would therefore hold that Lonergan J erred and that it was incumbent on this Court to exercise the discretion that her Honour did not appreciate that she had.”[33]

    33. Mohareb v Palmer [2018] NSWCA 220 at [14].

62. Leave was refused on the basis that there would, however, be no reason to set aside the judgment of Adamson J, although Lonergan J had understood the challenge to be based on the view upheld in the Federal Court that there was no debt (and therefore the Local Court judgment was without foundation). It is not necessary to address the reasoning why this court refused leave: it is sufficient to note that there was a substantial basis for the application for leave to appeal from the judgment of Lonergan J: the tenth proceeding cannot be said to have been vexatious.

Notice of motion – affidavit in support of application for vexatious proceedings order

63. The present proceedings brought by Mr Palmer were commenced on 16 July 2018. They were supported by an affidavit of that date. On 21 September 2018 Mr Mohareb filed a notice of motion seeking leave to prosecute Mr Palmer for perjury identified by reference to particular paragraphs of his affidavit of 15 August 2018. The judge described the motion as “inherently intimidatory”. [34] That characterisation was undoubtedly justified. As it turned out, the judge excluded as irrelevant critical paragraphs the subject of Mr Mohareb’s motion. Other paragraphs which were challenged used evaluative terms which involved “elements of opinion and matters of degree”, which were not capable of readily been identified as knowingly false. Such allegations were also vexatious in the sense of being groundless, as the judge held. [35]

    34. Primary judgment at [11].

    35. Primary judgment at [147]-[148].

64. The amended notice of motion filed on 12 April 2019 was entirely misconceived. It sought to reagitate many of the unsuccessful applications and claims which the applicant had raised in the earlier proceedings. It appears to have been inspired by the allegations in relation to those matters set out in the respondent’s affidavit. The motion was properly dismissed. Indeed, for the most part, the orders sought could not have been granted by way of motion in the proceedings commenced by Mr Palmer. The question is to what extent the primary judge was entitled to, and did, rely upon the notice of motion in support of the vexatious proceedings order.

65. A person’s lies in defending proceedings may be used in support of the claim brought against the person, as demonstrating awareness of the weakness or absence of a true defence. However, there is a difficulty in treating the conduct of the defence as another matter forming the subject of the claim. [36] Thus in disciplinary proceedings, as explained in Smith v New South Wales Bar Association,[37] a finding adverse to the defendant, based on his evidence in defending the proceedings, should not be taken into account as another instance of improper conduct, unless he was given an opportunity to address the possible adverse finding on that basis. A finding that the applicant had acted vexatiously in the course of defending proceedings brought against him under the Vexatious Proceedings Act should not constitute part of the basis for an order under the Act, unless the possibility of such a finding had been identified, either in the course of the hearing, or at least before the order was made. Mr Palmer’s statement of particulars on which the proceedings were based, did not include Mr Mohareb’s defence of the proceedings.

    36. Defamation proceedings fall into a special class.

    37. (1992) 176 CLR 256, at 269 (Brennan, Dawson, Toohey and Gaudron JJ) and 273 (Deane J); [1992] HCA 36.

66. In dismissing a paragraph in the notice of motion which sought a finding of bias on the part of Gibson DCJ, the following exchange took place: [38]

    38. Tcpt p 114(5).

“DEFENDANT: It is relevant in terms of –

HIS HONOUR: Relevant in terms of what? It is irrelevant to everything, because it is completely misconceived, because you Mr Mohareb, really don’t understand the procedure. I don’t seem to be able to explain it to you. This is part of what gives your conduct of this proceeding, I must say, the appearance of being vexatious.

DEFENDANT: Which?

HIS HONOUR: You simply – you just don’t know how to conduct a proceeding. You don’t seem to be able to understand when a judge explains to you the principles. You don’t seem to be able to respond to that. It makes it absolutely oppressive to a party to be able to conduct a case. Here you are trying to invite me to re-examine all of Judge Gibson’s decisions that have been decided against you.

DEFENDANT: I’m not saying that.

HIS HONOUR: After appeals –

DEFENDANT: I’m not saying that –

HIS HONOUR: Anything that has been decided against you.

DEFENDANT: I’m not saying that.

HIS HONOUR: That’s because you don’t understand the question of bias can’t be looked at in isolation. It’s only relevant to a ground of appeal.”

67. The closest the Court came to ensuring that Mr Mohareb was on notice of the possible inference of vexatious conduct drawn from his conduct in the course of the proceeding also occurred in dealing with his notice of motion: [39]

“HIS HONOUR: Paragraph 7 also must be summarily dismissed. I have no jurisdiction to make declarations with respect to bankruptcy. If you just open the first page of the Bankruptcy Act you’ll find that its jurisdiction lies in the Federal Circuit Court.

DEFENDANT: Okay.

HIS HONOUR: I must say, I must point out to you Mr Mohareb that these claims you’ve made here, these are examples of you pursuing things that have absolutely no reasonable foundation. Mr Palmer has come here to litigate a question about the application of Vexatious Proceedings Act. You’ve brought back against him a notice of motion claiming numerous paragraphs of things that you just couldn’t possibly have in this Court. Vexatious proceedings and vexatious conduct of a party may be demonstrated not only in cases where there is an intent, a subjective intent to harass and annoy, but where a person’s lack of legal understanding and pursuit of impossible claims puts the other party to a burden of litigation which that other party shouldn’t have to bear.

DEFENDANT: What burden was that?

HIS HONOUR: The burden of dealing with this notice of motion. It is a series of orders that is impossible for you to obtain.

DEFENDANT: What was – what did the plaintiff go through to respond to those? Nothing. He did nothing –

HIS HONOUR: We’ve been talking about it for a good part of the morning, Mr Mohareb.”

39. Tcpt 23/07/19, p 115(40).

68. It is quite doubtful that this passage was sufficient to put the applicant on notice that his conduct in filing the notice of motion would be treated, in determining whether a vexatious proceedings order should be made, as an additional particular of commencing proceedings without reasonable grounds.

69. The trial judge then put to the applicant that to seek to prosecute his opponent for perjury on affidavits sworn in the case appeared to be intimidatory. Mr Mohareb stated that Mr Palmer “didn’t take it this way” and “didn’t feel intimated by it.” [40] The exchange continued:

    40. Tcpt, p 120(10)-(15).

“HIS HONOUR: I am not concern[ed] with that. It is how I perceive it. That is why I am putting to you to give you an opportunity to respond to it. Aren’t you, by doing this, seeking to intimidate, by threatening him that you will seek leave to prosecute him for perjury –

DEFENDANT: No.

HIS HONOUR: If he advances his case on the basis of evidence that he’s sworn to?

DEFENDANT: No. No. I am simply – he was, you know, the door was closed. He opened it again. The door was already closed.

…

DEFENDANT: The perjury allegation was closed, and there was no way for me to reopen it because it was closed.

HIS HONOUR: Because you’ve had six goes. You’ve had three goes before Judge Gibson and another three in the Court of Appeal.

DEFENDANT: Yes, and it was closed. There was no way for me to reopen it. He was the one that reopened it.”

70. The notice of motion was undoubtedly misconceived; however, Mr Palmer did not seek to have it struck out, nor did he respond to it. At the first hearing of the matter, aborted after Mr Palmer was briefly cross-examined, to allow him to particularise his grounds, no objection was taken to the form of Mr Mohareb’s notice of motion. Indeed, he was given leave to amend it, which he did.

71. The point that the applicant appeared to be making at the hearing before the primary judge was that in order to resist a finding that the particularised proceedings were vexatious under any or all of the paragraphs of s 6 of the Vexatious Proceedings Act, the applicant was entitled to have the court reconsider each proceeding to determine if it had been instituted to harass or annoy or for another wrongful purpose, or without reasonable ground, or that it had been conducted to achieve a wrongful purpose in a way that harasses or causes unreasonable annoyance, regardless of subjective intention or motive. As the judge noted, Mr Palmer relied upon all four paragraphs of s 6. [41] In that sense, the applicant’s intention in saying that the respondent had reopened issues which were closed by the finality of a court judgment is tolerably clear.

    41. Primary judgment at [68].

72. Mr Palmer had been directed by Wright J at a hearing on 28 February 2019 to particularise which paragraphs of s 6 applied with respect to each proceeding claimed to be vexatious. Except for the first proceeding, which was said to have been conducted so as to force Mr Palmer to settle the matter, relying on s 6(d) of the Vexatious Proceedings Act, all proceedings were said to be vexatious pursuant to all four paragraphs of s 6. [42] (The terms of the settlement did not constitute part of the vexatious proceedings finding made by the primary judge.)

    42. Statement of particulars, 28 March 2019.

73. Although the notice of motion was misconceived, it is not clear that the primary judge relied upon it as a basis for his conclusion that the applicant “frequently instituted or conducted” vexatious proceedings. [43] As that course would need to have been expressly justified and notice given, absent amendment to the statement of particulars, the better view is that it was not relied upon. It should now be disregarded.

    43. It was expressly relied on in awarding indemnity costs against the applicant: Mohareb v Palmer (unrep, Fagan J, 2 September 2019) at [7].

Assessment of “frequently”

74. As noted above, the power of the court to make a vexatious proceedings order is only engaged where the court is satisfied that the person has “frequently” instituted or conducted vexatious proceedings in Australia. It is uncontentious that the term “frequently” involves a degree of imprecision, or flexibility, satisfaction as to which will depend on the litigious context. [44] The assessment of frequency involves a number of disparate factors.

    44. Attorney General of New South Wales v Croker [2010] NSWSC 942 at [18]-[23] (Fullerton J) referring to National Australia Bank Ltd v Freeman [2006] QSC 86 at [30] (Muir J) and Hambleton v Labaj [2010] QSC 124 at 56 (Applegarth J).

75. There are two objective parameters, namely the number of proceedings found to be vexatious and the period over which the proceedings were instituted or conducted. A third matter is the subject matter of the vexatious proceedings. In some cases it may involve proceedings against a range of other parties and raising a range of issues. The present case involves a set of proceedings involving one opponent, Mr Palmer, all arising from one original subject, namely the posting of the allegedly defamatory poster. The subsequent events were derivative from the original defamation proceeding.

76. A fourth consideration is the proportion of proceedings found to be vexatious. There may be a spectrum from a handful of vexatious applications in the course of lengthy litigation, at one end, to a plethora of vexatious applications in support of a series of groundless claims, at the other. It will be necessary to return to this aspect in relation to the present case.

77. A fifth consideration involves the evaluation of the underlying merits of the claims by the person instituting proceedings. Thus, a litigant in person may have a legitimate grievance which is pursued through a number of missteps. In the present case, that was true of the litigation with respect to the costs orders.

78. A further related consideration is the identity of the party responsible for initiating particular steps. Thus, the proceedings with respect to the costs order were initiated by Mr Palmer, not Mr Mohareb.

79. On the reasoning set out above, the number of vexatious proceedings (three) did not engage the description of proceedings frequently instituted. However, in my view, even had there been five such proceedings the frequency criterion would not have been met, having regard to the proportion of proceedings found to be vexatious. The following is a table of the relevant proceedings between the applicant and the respondent:

Proceedings	Included in Attorney General’s 2016 application	Trial judge found vexatious (and number)
(1)	Defamation claim commenced in District Court 19/8/14
Mr Palmer’s motion of 19 April 2015 to enforce settlement
(2)	First perjury motion in District Court 29515	Yes	Yes (1)
(3)	Leave to appeal from (2): Court of Appeal, filed 21 August 2015	Yes	Yes (2)
(4)	Second perjury motion: District Court: 15/12/15 (Applicant represented)	Yes	Yes (3)
(5)	Leave to appeal from (4): Court of Appeal (leave granted)	Yes (4)
(6)	Appeal to Court of Appeal (pursuant to leave)
(7)	Contempt referral motion: District Court 12/5/16	Yes	No (5a)
(8)	Third perjury motion: District Court 13/2/17	Yes (5b)
(9)	Leave to appeal from (7) and (8): Court of Appeal 14/8/17	Yes (6)
(10)	Special leave to appeal from (9): HCA 30/11/17	Yes (7)
Mr Palmer files costs certificate (subject to review) in Loc Ct
Mr Palmer files bankruptcy notice based on costs judgment: Fed Cir Court 9/5/17
(11)	Application to set aside judgment in Local Court
(12)	Supreme Court appeal from (11) (Adamson J)	Yes (8)
(13)	Application to set aside bankruptcy notice in Fed Cir Court: (set aside 15.11.17)
(14)	Supreme Court reopening application: 15/11/17 (refused)	Yes (9)
(15)	Leave to apply to Court of Appeal from (14): 02/07/18	Yes (10)
Mr Palmer commences proceedings under Vexatious Proceedings Act
(16)	Notice of motion in VP Proceeding	(Yes?)

80. This history of the proceedings reveals that there were a number of steps taken which were not found to be vexatious, including the commencement of the defamation proceedings and the appeal in the Court of Appeal from proceeding (5). Proceedings (11)-(16) all responded to steps initiated by Mr Palmer. The last proceeding was found to be a vexatious motion in the present proceedings, but it is not clear that reliance was placed upon that in making the order.

81. The proceedings covered a period of four years from August 2014 to July 2018. The initial claim by the applicant is not on the list of vexatious proceedings: every proceeding found to be vexatious was an interlocutory motion or an appeal from an unsuccessful interlocutory motion. That there were (on the view taken in this Court) five such vexatious proceedings out of 16 proceedings (not including those commenced by the respondent) over a period of four years does not, in my view, demonstrate that the applicant had frequently instituted groundless proceedings. It follows that, on my view that only three of the proceedings were without reasonable grounds, the power of the Court to make a vexatious proceedings order cannot have been engaged.

Orders

(a)   order with respect to the respondent

82. In his amended summons in the Common Law Division, the respondent claimed relief in the following terms:

1 An order pursuant to s 8(1)(a) of the Vexatious Proceedings Act 2008 (NSW) that the defendant be prohibited from instituting proceedings in any tribunal or court in the State of New South Wales, against the plaintiff, without leave of this Court.

2 An order pursuant to s 8(1)(a) of the Vexatious Proceedings Act 2008 (NSW) that any current proceedings in the State of New South Wales instituted by the defendant, against the plaintiff, be stayed.

3   Costs.

83. The primary judge made an order similar in terms to that sought in proposed order (1), but did not make the proposed stay of current proceedings, possibly because there were none. He awarded costs on an indemnity basis against the applicant, assessed in the lump sum of $19,000.22.

83. Those orders depended upon satisfaction that the applicant had “frequently instituted or conducted” vexatious proceedings within the terms of s 8(1)(a) of the Vexatious Proceedings Act. Having concluded that all of the 10 proceedings, other than one aspect of the fifth proceeding, had been vexatious proceedings, he was accordingly satisfied as to the frequency requirement. He said he would have been so satisfied even if only the seven proceedings pursuant since Schmidt J dismissed the Attorney General’s application in December 2016 were to be considered.

84. The findings made above are that only part of the fifth proceeding and proceedings six and seven were vexatious. They do not justify a finding of frequent institution of vexatious proceedings. Further, two, being applications for leave to appeal, were themselves briefly disposed of and should be treated as at the lower end of the scale of seriousness of such conduct.

85. Even if the criteria of engagement of the power to make a vexatious proceeding order were satisfied, the Court’s power is discretionary. Where proceedings require leave of this Court for their commencement, there is a largely marginal benefit in requiring a further stage of leave under the Vexatious Proceedings Act. Where proceedings are to be instituted in other courts, it is to be borne in mind that the leave application must be made in the Common Law Division of this Court, which adds an additional layer of procedural complexity to proceedings which might more readily and cheaply be disposed of in, say, a Local Court or tribunal. The discretion must be exercised with caution at the behest of a single opponent who has himself instituted at least one of the proceedings, which led to four consequential applications.

86. In my view, on the findings set out above, order (1) should be set aside. It follows that the costs order must also be set aside.

(b)   vexatious proceedings order – third parties

88. Order (2) made by the primary judge prohibited the applicant from “instituting any new proceeding against any person in New South Wales”. The order was unlimited as to time, circumstances or parties. Such orders should only be made where circumstances clearly demand such an order. Although it was not expressly challenged by the applicant, it would be anomalous to leave the order on foot when order (1) is set aside. Order (2) had not been sought in the respondent’s amended summons in the Common Law Division. Indeed, in the course of the submissions before the primary judge Mr Mohareb described an attack upon him December 2017, which led to the following exchange: [45]

“DEFENDANT: Anything I’ve done any, any court action or proceeding I’ve done after 4 December 2017 must be seen in the context of the attack that I was subjected to.

HIS HONOUR: I can’t see that has anything to do with it.

DEFENDANT: Well, if I’ve acted inappropriately, the mitigating circumstances that this should be seen as a mitigating circumstance.

HIS HONOUR: I’m really only concerned on Mr Palmer’s application with proceedings against him.”

45. Tcpt, p 174(35).

89. Making an order in terms not foreshadowed during or after the hearing is a breach of procedural fairness. Following the completion of Mr Mohareb’s submissions, the judge stated that he did not need to hear from Mr Palmer and reserved his decision. [46]

    46. Tcpt, p 175(48).

90. In these circumstances, it was not appropriate to make an order in the blanket terms of order (2), prohibiting the applicant from bringing proceedings against any person in New South Wales. This Court has commented before on the degree of restraint which is required in any case where such an order is made. Order (2) should be set aside.

Costs

91. The applicant has been successful in resisting the orders sought by Mr Palmer under the Vexatious Proceedings Act. He should not have to pay Mr Palmer’s costs of the proceedings in the Common Law Division, but should have his costs as an unrepresented litigant, limited to expenses actually incurred in the course of those proceedings.

92. The question of costs in this Court is more difficult. Mr Palmer did not seek to resist the appeal. Rather, the defence of the orders below was undertaken by the Attorney. The circumstances in which the Attorney effectively took over the defence of the proceedings are set out in an affidavit of Ms Kiri Mattes affirmed on 24 February 2020. There is no reference to any discussion as to liability for costs. However, on the basis that the Attorney was the active contradictor, in his written submissions of the same date, he sought an order for costs. It must follow that he will accept liability for the costs given the outcome of the proceedings. Those costs should be awarded on the basis of an unrepresented litigant, namely expenses incurred by Mr Mohareb in commencing and pursuing the proceedings in this Court.

Orders

93. I propose the following orders:

1. Grant the applicant leave to appeal from the judgments and orders made in the Common Law Division on 7 August 2019 and 2 September 2019.

2. Set aside orders (1) and (2) made in the Common Law Division on 7 August 2019 and orders (1) and (2) made on 2 September 2019.

3. Order that Mr Palmer pay Mr Mohareb’s expenses as an unrepresented litigant of the proceedings in matter 2018/217228 in the Common Law Division.

4. Order that the Attorney General for the State of New South Wales pay the applicant’s expenses as an unrepresented litigant of the proceedings in this Court.

5. Direct that the applicant within 14 days advise:

1. Mr Palmer of the amount of any expenses sought in respect of order (3),

2. the Crown Solicitor of the amount of any expenses sought in respect of order (4) and,

if agreement cannot be reached within a further 14 days, submit those documents to the Registrar of the respective courts for determination of a lump sum costs order, to be made by the Registrar.

94. McCALLUM JA: I agree with Simpson AJA.

95. SIMPSON AJA: The Vexatious Proceedings Act2008 (NSW) (“the VP Act”) makes provision with respect to vexatious proceedings in the courts and tribunals of NSW. Section 8(1) provides that an authorised court (of which the Supreme Court is one) may make a “vexatious proceedings order” in relation to a person if satisfied that:

“… the person has frequently instituted or conducted vexatious proceedings in Australia …”

96. By subs (4) of s 8 an order may be made on the court’s own motion, on the application of the Attorney-General, the Solicitor General, a court registrar, a person against or in relation to whom another person has instituted or conducted vexatious proceedings, or (with the leave of the authorised court) by a person who, in the opinion of the court, has a sufficient interest in the matter.

97. “Proceedings” is defined, broadly, in s 4, to include (inter alia) proceedings within the jurisdiction of any court or tribunal, proceedings incidental to such proceedings, interlocutory proceedings or applications and appeals and applications for leave to appeal against a decision of a court or tribunal.

98. “Vexatious proceedings” is defined, inclusively, in s 6, as:

(a)   proceedings that are an abuse of the process of a court or tribunal, and

(b)   proceedings instituted to harass or annoy, to cause delay or detriment, or for another wrongful purpose, and

(c)   proceedings instituted or pursued without reasonable ground, and

(d)   proceedings that are conducted to achieve a wrongful purpose, or in a way that harasses, or causes unreasonable annoyance, delay or detriment, regardless of the subjective intention or motive of the person who instituted the proceedings.

The separate paragraphs of s 6 are not to be construed as “independent and self-contained categories”: Viavattene v Attorney-General (NSW) [2015] NSWCA 44 at [14]; Mahmoud v Attorney-General of New South Wales [2017] NSWCA 12 at [22]. In many cases, a proceeding under consideration would be likely to fall within more than one of the s 6 categories.

99. By s 8(3) a vexatious proceedings order must not be made unless the person in respect of whom the order is sought has been heard or has been given the opportunity to be heard.

100. By s 8(7) the orders that may be made are:

(a)   an order staying all or part of any proceedings in New South Wales already instituted by the person,

(b)   an order prohibiting the person from instituting proceedings in New South Wales,

(c)   any other order that the Court considers appropriate in relation to the person.

101. By s 14(2) a person subject to a vexatious proceedings order in terms of s 8(7)(b) may apply to the appropriate authorised court for leave to institute proceedings the institution of which would otherwise be prohibited. The balance of s 14 imposes conditions on the making of such an application. Sections 15 and 16 respectively state circumstances in which the authorised court must dismiss the application or may grant leave. Section 16 imposes significant constraints on the leave that may be granted.

The application for a vexatious proceedings order

102. By amended summons filed in the Supreme Court on 15 August 2018 the respondent, Mr Matthew Palmer, sought:

“1. An order pursuant to section 8(1)(a) of [the VP Act) that the defendant [Mr Nader Mohareb] be prohibited from instituting proceedings in any tribunal or court in the state of New South Wales, against the plaintiff [Mr Palmer], without leave of this Court.

2. An order pursuant to section 8(1)(a) of [the VP Act] that any current proceedings in the state of New South Wales instituted by the defendant, against the plaintiff, be stayed.

3.   Costs.”

103. In written submissions Mr Palmer contended that each of the eleven proceedings commenced against him by Mr Mohareb that he there identified was vexatious within each of pars (a)-(d) of s 6 of the VP Act.

104. On 7 August 2019 Fagan J (“the primary judge”), made the following orders:

“(1)   The defendant, Nader Nabil Sedra Mohareb, is prohibited from instituting any proceeding against the plaintiff, Matthew Palmer, in New South Wales.

(2)    The defendant, Nader Nabil Sedra Mohareb, is prohibited from instituting any new proceeding against any person in New South Wales, this order not to affect the filing of any interlocutory process in proceedings that have been commenced at the date of this order or any appeal or application for leave [to] appeal from a decision in any such proceeding.

(3)   The defendant’s amended notice of motion filed 12 April 2019 is dismissed”: Palmer v Mohareb [2019] NSWSC 975 (“the primary judgment”).

105. It will be seen that Order 2 is wider than the orders sought by Mr Palmer in that it extends to proceedings instituted (or to be instituted) by Mr Mohareb against “any person”, other than any “interlocutory process” in already commenced proceedings, or appeals or applications for leave to appeal in respect thereto. The orders sought by Mr Palmer were confined to proceedings instituted by Mr Mohareb against him.

106. On 2 September 2019, the primary judge ordered Mr Mohareb to pay Mr Palmer’s costs, which he assessed (on the indemnity basis) in the gross sum of $19,000.00: Palmer v Mohareb, (Supreme Court (NSW), Fagan J, 2 September 2019, unrep (no medium neutral citation).

107. The primary judge found that ten of the eleven proceedings identified by Mr Palmer that were commenced by Mr Mohareb against Mr Palmer, or against Mr Palmer and his wife, Mrs Annette Palmer, between 29 May 2015 and 2 July 2018 were vexatious within the meaning of s 6(c) of the VP Act, that is, were instituted or pursued without reasonable ground. His Honour did not make findings with respect to any of the other paragraphs of s 6. He found (at [150]) that the ten proceedings were sufficient to satisfy the requirement of frequency in s 8(1). He had regard to litigation commenced by Mr Mohareb against individuals other than the Palmers. He considered (at [152]) that:

“The gravity of this vexatious conduct necessitates a further order prohibiting Mr Mohareb from instituting any fresh proceedings in New South Wales against any person.”

The proceeding in this Court

108. By summons filed on 14 October 2019 Mr Mohareb seeks leave to appeal against the orders of 7 August 2019 and 2 September 2019. Pursuant to s 101(2)(r) of the Supreme Court Act 1970 (NSW) leave is required to appeal against the 7 August orders because the “matter at issue” in the proceedings is not of the value of $100,000 or more: Potier v Attorney-General in and for the State of New South Wales (2015) 89 NSWLR 284; [2015] NSWCA 129 at [47]. Leave is required to appeal against the September orders because they relate to costs: s 101(2)(c) and (q). The President has directed that the application for leave and (if leave is granted) the appeal be heard concurrently.

109. On 13 December 2019 the Registrar of the Court of Appeal made orders, by consent, joining the Attorney-General of NSW to the proceeding as second respondent. The Attorney-General has filed written submissions in support of the orders made. The first respondent, Mr Palmer, has not participated in the application, which was listed for hearing on 5 March 2020. On 4 March he communicated by email with the Court, indicating that he had not filed an appearance or submissions, that he did not intend to appear, that he intended “to act as a silent respondent”, and that he had received and read the submissions of the Attorney-General.

110. The precise role the Attorney-General sought to play as a respondent to the proceedings was not immediately apparent. He was joined on his own application. Affidavit evidence was produced that showed that the Attorney-General is party to other, unrelated, proceedings instituted by Mr Mohareb. The interest of the Attorney-General is to uphold the orders made, particularly Order 2, which precludes the institution of any new proceedings against “any person”. The Attorney-General has indicated that, as “the active contradictor” (and if successful), he will seek the costs of the appeal. The question for present determination is whether the primary judge was in error in finding that any (or all) of the ten proceedings was (or were) vexatious within s 6(c) of the VP Act, as having been instituted without reasonable ground.

111. It has not been suggested on behalf of the Attorney-General (or Mr Palmer) that, if any of those findings was erroneous, this Court should consider whether the proceeding in question was vexatious within the meaning of any of pars 6(a), (b) or (d).

The proposed appeal

112. Mr Mohareb has identified six proposed grounds of appeal, pleaded as follows:

“1.   There is no lawful or factual basis for the primary judge’s findings that all of the applicant’s proceedings against the respondent were ’instituted and/or pursued without reasonable ground within the meaning of s 6(c) of the Vexatious Proceedings Act’.

2.   The primary judge denied the applicant procedural fairness by not affording the applicant the opportunity to be heard with respect to the grounds upon which the above mentioned findings were based.

3.   The primary judge denied the applicant procedural fairness by putting the onus on the applicant to prove his innocence, rather than on the respondent to prove his case against the applicant.

4.   The primary judge denied the applicant procedural fairness by preventing the applicant from cross-examining the respondent.

5.   The primary judge’s findings are affected by actual bias in that his Honour was so committed to a conclusion already formed so as to not-be-open [sic] to persuasion and so-as-to-be [sic] incapable of alterations, whatever evidence or argument may be presented.

6.   The primary judge disregarded a recusal application made by the applicant.” (italics in original)

113. Mr Mohareb has directed no submissions to grounds 2 – 6. In grounds 2, 3 and 4 Mr Mohareb asserts denial of procedural fairness in a number of ways, but he has not supported these grounds by reference to any evidence. Nor is it possible to make a determination with respect to ground 5, an assertion of actual bias in the primary judge. Mr Mohareb has directed lengthy and detailed submissions to ground 1. He has not directed any submissions to the issue of costs.

114. As will become apparent I have come to the view that error has been identified in the primary judgment sufficient to warrant a grant of leave to appeal.

Applicable legal principles

115. Before embarking on a consideration of the grounds of appeal it is appropriate to state some relevant legislative history and some applicable principles.

116. Access to courts for redress of actual or perceived wrongs and for adjudication of claims is a basic right in a democratic society: R De W Kennedy (Finance) Pty Ltd v Ley; Ley v Scarff (Supreme Court (NSW), Holland J, 29 March 1978, unrep), quoted in Attorney-General v Wentworth (1988) 14 NSWLR 481 at 484. It is also to the benefit of citizenry generally because it provides a civilised and enforceable means of settlement of disputes. Restriction of access to courts is an extreme interference with those rights: Wentworth at 484; Soden v Kowalski [2011] FCA 318 per Stone J at [35] and in the Full Court: Kowalski v Mitsubishi Motors Australia Ltd (2011) 198 FCR 153; [2011] FCAFC 159 at [58].

117. There are, however, those who avail themselves of access to the court in a way that amounts to abuse, misuse or unfair exploitation, significantly to the detriment of those whom they pursue, and the system of justice itself.

118. The Supreme Court has long been possessed of a power to rein in excessive and vexatious use of its processes. Until 2008 that power was to be found in s 84 of the Supreme Court Act, the language of which was cumbersome and arcane. The text of s 84(1) can be found in the report of Wentworth. It provided a remedy where a person, called a “vexatious litigant”:

habitually and persistently and without any reasonable ground institutes vexatious legal proceedings ….

119. Since 2008 the power has been found in the VP Act. Introducing the Vexatious Proceedings Bill in the Legislative Council on 28 October 2008 the Honourable Henry Tsang, on behalf of the Attorney-General, said:

“The Government recognises the harm caused to, and costs incurred by, opposing parties and other participants in the justice system as a result of persistent litigation by vexatious litigants. Vexatious litigants abuse court processes by repetitively pursuing frivolous applications, raising spurious defences, refusing reasonable settlement offers, failing to pay costs after being ordered to do so, and launching unmeritorious appeals.

These actions impinge on the effectiveness and efficiency of the justice system and make the process more expensive for everyone. Innocent parties can be dragged through the courts, often at great financial and emotional cost” (New South Wales Legislative Council, Parliamentary Debates (Hansard), 28 October 2008 at 10643).

120. There can be no clearer statement that the new provisions were intended to facilitate the restraint of those who fall into the category of vexatious litigants. Nevertheless the VP Act also recognises the importance of access to justice through the established court system. Mr Tsang went on to say:

“The Vexatious Proceedings Bill seeks to protect the fundamental right of citizens to approach the courts to seek justice in accordance with the law while preserving the efficiency of the justice system and shielding other participants in the justice system from unmeritorious actions.”

121. In Kowalski, speaking of analogous provisions in the Federal Court of Australia Rules 1976 (Cth), Stone J said:

“35.    The relief for which these rules provide is extreme. It deprives the person subject to the order of a right that is fundamental to the preservation of a civil society governed by the rule of law, namely the right to call on the Court to resolve a dispute or adjudicate a claim simply by filing an application in the prescribed form. For this reason such an order is not made lightly …

183. Notwithstanding that he found that the notice of motion seeking orders under s 203 of the District Court Act was not a vexatious proceeding, the primary judge nevertheless considered that the application for leave to appeal against its dismissal did come within that category. The application for leave to appeal against the dismissal of both notices of motion was the sixth proceeding found by the primary judge to have been vexatious.

184. His Honour then referred to the decision of Schmidt J in which the same proceeding had been advanced as vexatious, but was found by Schmidt J to have been “not either obviously groundless, or its pursuit wrongful …” (at [123]).

185. The primary judge concluded:

“124.   The Attorney-General only argued that Mr Mohareb’s pending notice of motion for contempt in the Fifth Proceeding was vexatious on the basis of subjective intent to harass and annoy. Her Honour’s [ie Schmidt J’s] rejection of that and her statement that the contempt application was “not … obviously groundless” have been diminished in significance by subsequent events. Gibson DCJ heard the matter at length, applied correct legal principles, found that the evidence was not capable of sustaining a charge of contempt and determined that, in any event, on discretionary grounds the allegation should not be referred. From those conclusions Mr Mohareb had no reasonable ground for seeking leave to appeal, as he did in the Sixth Proceeding.”

187. Mr Mohareb took issue, in a number of respects, with the approach taken by the primary judge. He argued, reasonably, that the fact that this Court had found that Gibson DCJ’s findings of fact were open to her did not necessarily entail a conclusion that an argument to the contrary was not a basis on which he could rely by way of appeal. That may be correct; but the critical finding by the primary judge, at [124], was the adoption of the finding by Gibson DCJ that “the evidence was not capable of sustaining a charge of contempt”. That being the case, the proceeding was instituted without reasonable ground.

1. the seventh vexatious proceeding

188. On 30 November 2017 Mr Mohareb sought special leave to appeal to the High Court against the orders of this Court of 2 November 2017 ([2017] NSWCA 281), refusing leave to appeal (the sixth vexatious proceeding). On 15 February 2018 the application for special leave was refused: [2018] HCASL 18. The High Court said that the decision refusing leave to appeal from each of the three interlocutory orders (the fifth vexatious proceeding) made in that case was “plainly correct”.

189. This was the seventh proceeding found by the primary judge to have been vexatious. The relevant findings are to be found in [125] and [126] of the primary judgment, as follows:

“125.   Mr Mohareb’s Seventh Proceeding was an application to the High Court for special leave to appeal against the Court of Appeal’s decision in his Sixth Proceeding. The special leave application reflects Mr Mohareb’s distorted perception of the merits and significance of the series of proceedings in which he had failed up to this point. He was evidently unaware of the limitations upon the circumstances in which special leave will be granted. It is the combination of exaggeration of grievances and ignorance of substantive, evidentiary and procedural law that has made Mr Mohareb a vexatious litigant. He vigorously pursues claims that have no reasonable foundation, inflating the importance of his quarrels and oblivious to the constraints of law and procedure.

126.   The absence of any reasonable ground for the Seventh Proceeding is sufficiently expressed in its dismissal, on the papers, by Bell and Gageler JJ, in these words:

The decision of the Court of Appeal of the Supreme Court of New South Wales refusing the applicant leave to appeal from each of the three interlocutory orders made by the District Court of New South Wales is plainly correct. Special leave should be refused.”

190. Mr Mohareb argued that the mere fact of dismissal of a proceeding is insufficient to justify the proceeding being labelled groundless. That is correct. Whether a proceeding is groundless depends on more than the outcome. As Mr Mohareb observed, if refusal of special leave to appeal to the High Court were sufficient to warrant the label “without reasonable ground”, a vast proportion of applications for special leave would be so labelled.

191. Moreover, “ignorance of substantive, evidentiary and procedural law” on the part of an unrepresented litigant says nothing of the existence of a reasonable ground for the application. That was an irrelevant observation intruded into the determination of whether the application was made without reasonable ground.

192. Putting aside Mr Mohareb’s asserted “ignorance”, the finding of the primary judge did not depend only on the outcome. It depended on the reasons given by the High Court for the refusal of special leave. That was that the decision of this Court was “plainly correct”. That implies that the High Court considered that there was no reasonably arguable ground on which to challenge the decision in question. In those circumstances, the application was instituted without reasonable ground.

1. the eighth vexatious proceeding

193. During the course of this litigation numerous costs orders were made against Mr Mohareb in favour of Mr Palmer, or Mr and Mrs Palmer. These were assessed under the relevant legislation (Legal Profession Uniform Law Application Act 2014 (NSW)) and certificates filed in the Local Court at Manly, resulting in judgment in favour of the Palmers for almost $13,000. A bankruptcy notice was issued by Mr Palmer on 9 May 2017.

194. Mr Mohareb filed a notice of motion in the Local Court seeking an order that the judgment be set aside and an order that the bankruptcy notice also be set aside. The Local Court did not have jurisdiction to make the latter order. A Local Court magistrate declined to make an order setting aside the judgment, but did, on 26 May 2017, grant a stay pending the outcome of review of the certificates. The magistrate also declined to make an order, sought by Mr Mohareb, for his “costs and disbursements” of the proceedings. At one point in the discussion the magistrate expressed doubt about her power to make such an order. She gave as the reason for declining the costs order that Mr Mohareb’s application had not been successful. That was because his application was to set aside the judgment, and she had not made such an order but had, instead, granted a stay pending the outcome of a review of the certificates. The doubt she had expressed about her power to award costs in favour of an unrepresented litigant did not play any part in the brief reasons she gave.

195. On 23 June 2017 Mr Mohareb filed a summons in the Supreme Court seeking, under s 40(2)(c) of the Local Court Act 2007 (NSW), leave to appeal against that part of the order of the magistrate that related to his claim for costs and disbursements.

196. Mr Mohareb advanced three grounds in support of his application. They were:

1. that the magistrate declined to make an order in his favour for costs and disbursements under a misapprehension as to her power to do so;

2. that the magistrate failed to take into account a relevant consideration, that being his “imperative need” to make the application in light of the bankruptcy notice; and

3. that the reasons given by the magistrate were inadequate.

   197. On 1 November 2017 the summons was dismissed by Adamson J: Mohareb v Palmer [2017] NSWSC 1491. Her Honour rejected each of the three grounds as insufficient to warrant a grant of leave.

   198. Although there is no explicit finding to this effect in the primary judgment, it is clear that the primary judge found that the proceeding in the Supreme Court was vexatious as being instituted without reasonable ground. This was therefore the eighth proceeding found to have been vexatious.

   199. The primary judge observed that, as a self-represented litigant, Mr Mohareb’s costs would not have been more than a filing fee of about $80, and that Mr Mohareb had claimed to have incurred counsel’s fees of $3,300 for advice. He considered that it was:

   “highly unlikely that any significant part of that would be assessed, given the extremely simple nature of the proceeding:” at [133]

   200. His reasons for finding this proceeding vexatious were expressed in [134], as follows:

   “134.   The summons was dismissed with costs by Adamson J on 1 November 2017: Mohareb v Palmer [2017] NSWSC 1491. Mr Mohareb argued that the learned magistrate had acted under the misapprehension that she lacked power to award costs in favour of a litigant appearing in person; that he had brought the application in the Local Court of necessity and that the magistrate had not taken this into account; and that insufficient reasons had been given. None of these grounds had any possibility of acceptance. They were rejected by Adamson J at [23]-[31]. Mr Mohareb’s summons could as well have been dismissed solely on the basis that it that did not warrant consideration for such a small amount in issue, the decision in relation to which had been made in exercise of the Local Court’s broad discretion as to costs.”

   201. Mr Mohareb asserted that were factual errors in the primary judge’s account of this proceeding. He claimed that he had relied on different facts, namely that the issuing of the bankruptcy notice was both an abuse of process and a contempt of court and that this was “so clearly the case” that he could not be denied a costs order.

   202. These assertions are not borne out by the summons seeking leave to appeal filed in the Common Law Division, which recounted some history, and then, in [11], pleaded:

   “The Manly Local Court Magistrate’s (sic) erred in deciding to decline an order for costs/disbursement for the Plaintiff on the basis that self represented litigants are not entitled to orders as to costs or disbursements.”

   203. There was no proper basis for the claim that the Magistrate had proceeded under a misapprehension about her power to award costs to an unrepresented litigant. In the proceedings there was a lengthy and unresolved discussion about the applicable legislation. It is true that, during the course of that discussion, the magistrate said that she did not know if she had the power to make a costs order in favour of an unrepresented litigant, and Mr Mohareb made clear that he was seeking disbursements only. The magistrate then declined to make the order sought, on the basis that she had not made the orders sought in the summons (but had made an alternative order).

   204. The appeal to the Common Law Division was doomed to failure. The primary judge was correct to find that that application was instituted without reasonable ground.

1. the ninth and tenth “vexatious proceedings”

205. On 15 November 2017 the bankruptcy notice was set aside in the Federal Circuit Court as invalid because it was based on a costs order that was under review and therefore subject to a statutory suspension: Legal Profession Uniform Law Application Act 2014 (NSW), s 86 (in the matter of Nader Mohareb; Matthew Palmer v Nader Mohareb NSD 1760 of 2017).

206. On 15 November 2017 Mr Mohareb filed in the Supreme Court a notice of motion seeking orders under UCPR r 36.16 setting aside the orders of Adamson J and allowing him to appeal from the Local Court orders.

207. On 3 April 2018 the summons was dismissed with costs by Lonergan J: Mohareb v Palmer (No 2) [2018] NSWSC 400. Her Honour held that no error was identified in the judgment, and that Mr Mohareb’s reliance on UCPR r 36.16 was misconceived because Adamson J’s decision determined a claim for relief and dismissed the whole of the proceedings (see r 36.16(3)) (at [21]). It may be accepted that her Honour was in error in this respect.

208. Again, the primary judge did not explicitly find that this proceeding was vexatious, although it may be inferred that he did. His Honour said:

“139. Because of her Honour’s view that, in the circumstances, the Court had no power under r 36.16, she did not need to address the stark logical fallacy in Mr Mohareb’s application. The Federal Court’s determination that the Bankruptcy Notice was invalid had no bearing upon the learned magistrate’s discretionary refusal to award costs when rejecting Mr Mohareb’s application to set aside judgment six months earlier. The declaration of invalidity of the Bankruptcy Notice was not a relevant or material change of circumstances that had any bearing upon the basis for the decisions of the learned magistrate and of Adamson J.”

209. Mr Mohareb contended that the decision of Lonergan J was erroneous because there had been a material change in his circumstances since the decision of Adamson J, that being the setting aside of the bankruptcy notice in the Federal Court. As the primary judge found, the setting aside of the bankruptcy notice had no bearing on the decision of the magistrate to decline to award costs in Mr Mohareb’s favour. The primary judge was correct. The ninth proceeding was instituted without reasonable ground and was therefore vexatious within the meaning of s 6(c).

210. On 2 July 2018 Mr Mohareb filed a summons seeking leave to appeal against the orders of Lonergan J. The summons was dismissed on 4 October 2018: Mohareb v Palmer [2018] NSWCA 220 by Beazley P and Macfarlan JA. Although the Court found that Lonergan J misapprehended her jurisdiction (having regard to subr (3A) of r 36.16), it nevertheless found no basis for setting aside Adamson J’s judgment.

211. This was the tenth proceeding found by the primary judge to have been vexatious. The relevant conclusions are at [143], as follows:

“143.   This entire litigious foray into the Supreme Court concerning the Local Court costs claim involved two hearings before Divisional judges and one before the Court of Appeal, spread over 11 months. Mr Mohareb represented himself in all of the Eighth, Ninth and Tenth Proceedings. Mr Palmer was represented by a solicitor before Adamson J and thereafter appeared in person. For these 11 months, overlapping with the latter stages of the saga concerning perjury and contempt (the Fifth to Eighth Proceedings), Mr Palmer was brought back and forth to court and public resources available for the hearing and disposition of genuine and serious disputes were diverted and wasted. Mr Mohareb’s obstinate attempts to review this discretionary decision about a very small sum lacked legal merit or prospects of success. This was groundless, vexatious litigation par excellence.”

212. It was established that Lonergan J had misapprehended her jurisdiction. That, in my opinion, provided a sufficient ground for the application for leave to appeal. It is not to the point that the application failed on other grounds. I do not accept that this proceeding was vexatious as having been brought without reasonable ground. The finding that it was should be set aside.

Mr Palmer’s application for orders under the Vexatious Proceedings Act

213. As indicated above, on 15 August 2018 Mr Palmer filed in the Supreme Court the application seeking, against Mr Mohareb under the VP Act, the orders set out in [102] above. On 15 August 2018 he swore an affidavit in support of the application. On 18 October 2018 he swore a second affidavit.

214. On 21 September 2018, by notice of motion filed in those proceedings, and amended on 12 April 2019, Mr Mohareb again sought leave pursuant to s 338(1)(c) of the Crimes Act to prosecute Mr Palmer for perjury (order 1 as sought). On this occasion he alleged that perjury was committed by Mr Palmer swearing the affidavits of 15 August 2018 and 18 October 2018. He also sought:

(2) an order pursuant to Part 55 of the Supreme Court Rules 1970 (NSW) and s 326 of the Crimes Act that Mr Palmer be punished for contempt of court;

(3) an order granting leave under s 23 of the Defamation Act 2005 (NSW) to bring a cross-claim for defamation arising out of the same publications as had founded the original District Court proceedings;

1. a finding of bias on the part of Gibson DCJ;

2. an order that all costs orders made by Gibson DCJ be vacated;

3. a similar order in relation to costs orders made by other courts in proceedings arising out of decisions by Gibson DCJ; and

(7i)    an order that a sequestration order against his estate made by the Federal Circuit Court on 5 November 2018 be annulled.

215. With respect to Order 2 as sought, a Statement of Charge annexed to the Notice of Motion shows that the contempt alleged arose out of the confrontation between Mr Mohareb and Mr Palmer in the Church Point carpark on 1 April 2016 – that is, the same confrontation that was alleged as the contempt Mr Mohareb sought to have prosecuted in the fifth vexatious proceeding.

216. The order sought as (3) was plainly misconceived. Section 23 of the Defamation Act precludes, without the leave of the court, a second or subsequent defamation claim against the same defendant arising out of the publication of “the same or like matter”. It has nothing to do with cross-claims.

217. The primary judge dealt with this notice of motion at the outset of his reasons. With respect to orders (4)- (7) as sought, the primary judge concluded that they would be:

“20.   …recognised as insupportable by anyone with a basic knowledge of the hierarchy of the courts and of their respective jurisdictions.”

218. He considered that the claim for leave under s 338(1)(c) of the Crimes Act to prosecute Mr Palmer for perjury was “inherently intimidatory”, made before the court had heard cross-examination of Mr Palmer on the affidavits in which the perjury was alleged to have been committed, or received any contradictory evidence, let alone having made any findings on the evidence said to have been perjured. He held that it was an abuse of process for Mr Mohareb to make that application at the time he did. He added:

“12.   In addition, it could not reasonably be contemplated that leave would be granted for a private prosecution to be launched by a man who has been engaged in highly personal litigation against the person he wishes to prosecute; who has by the content of his applications and arguments and by the repeated dismissal of his claims demonstrated a profound lack of legal knowledge or skill; and whose volatile behaviour in court, including on the hearing of this summons, has shown him entirely unsuited to the role of prosecutor.”

219. He held that the application that Mr Palmer be dealt with for contempt was an abuse of process, it being the same alleged contempt as had been rejected by Gibson DCJ in Mohareb v Palmer (No.4) [2017] NSWDC 127 at [85]-[93]. He noted that the application to bring a cross-claim in defamation was not pressed.

220. On these findings, the primary judge found the notice of motion of 21 September 2018 (as amended on 12 April 2019) was vexatious (although he did not expressly identify into which of the paragraphs of s 6 of the VP Act the proceeding fell). He found that there was no reasonable foundation for any of the orders sought.

221. Mr Mohareb has not raised any ground of appeal that challenges that ruling. Nor has he raised any ground of appeal that challenges order 2, going beyond the orders sought by Mr Palmer. Although the primary judge expressly found that the proceeding constituted by the notice of motion was vexatious, it is not clear that it played any part in the ultimate decision to make the orders that were made. It is against those orders that Mr Mohareb now appeals.

222. The transcript shows that Mr Mohareb was not given adequate notice of the proposal to consider, and potentially take into account, the notice of motion. It should be disregarded, as should the primary judge’s assessment of it as vexatious.

Did Mr Mohareb frequently institute vexatious proceedings?

223. The primary judge went on to consider whether, on the detailed findings he had made, Mr Mohareb had “frequently” instituted vexatious proceedings. In that respect, he said:

“150.    … Here, the 10 proceedings against Mr Palmer that I have considered in detail have all been vexatious (the Fifth Proceeding in part only) and they constitute all but a small part of the litigation between the two parties. Mr Palmer has referred to Mr Mohareb’s litigation against other defendants and I have read some of the decisions in those cases. However, the proportion of vexatious proceedings against Mr Palmer relative to the whole of Mr Mohareb’s litigious activities has not been explored before me.”

224. Having regard to the conclusions expressed above it will be necessary to reconsider the question of frequency. I have concluded that Mr Mohareb instituted 5 proceedings without reasonable ground. In my opinion, that is sufficient to satisfy the requirement of frequency in s 8(1) of the VP Act. That, in turn, is sufficient to justify order 1 made by the primary judge.

The orders made

225. Under the heading “Orders” his Honour said:

“151. The criterion of “frequently instituted or conducted” in s 8(1)(a) of the Act is amply satisfied by the ten vexatious proceedings prosecuted between mid-2015 and mid-2018. It would be satisfied even if attention should be confined to the seven proceedings Mr Mohareb has pursued since Schmidt J dismissed the Attorney-General’s application in December 2016. An order prohibiting Mr Mohareb from instituting further proceedings against Mr Palmer in New South Wales is justified.”

226. Order 2 made by the primary judge was not sought by Mr Palmer. It was justified by primary judge in the following terms:

“152.   The gravity of this vexatious conduct necessitates a further order prohibiting Mr Mohareb from instituting any fresh proceedings in New South Wales against any person. I am satisfied that his tendency to mount unsustainable proceedings and to abuse court processes in pursuit of a perceived wrong doer is general. There is no basis in the evidence for concluding that Mr Mohareb’s unacceptable litigiousness is only a product of his conflict with Mr Palmer and that it would not be repeated in relation to some other person with whom he might get into conflict.

153.   As Mr Palmer’s summons is concerned with securing protection for himself and as he has conducted the case without legal assistance, the Court has not been provided with the evidence that would be necessary to make findings about the extent of any vexatious conduct or applications in Mr Mohareb’s other current matters. The Court is aware of proceedings that have not been finalised, brought by Mr Mohareb against [a number of named defendants].

154. On the hearing of this summons the Court has not received sufficient information about the course of those cases to justify an order staying any of them under s 8(8)(a). In the absence of any stay under the vexatious proceedings act, those cases will continue, with control being exercised over any abuses of process or groundless applications in accordance with the UCPR.”

227. In my opinion there was no warrant for the expansion of the orders sought by Mr Palmer. Order 2 should be set aside.

228. The orders permitted by s 8 of the VP Act are discretionary in nature. The discretion is to be exercised with one eye to the ramifications of barring access to the courts, discussed above. A balance is to be struck, between preservation of the fundamental right of access to the processes of the law on the one hand, and restraint of unwarranted exercise of that access, with its consequences on other parties to the litigation. Regard must be had to the position of the opposing litigant. In this case, the history recounted above satisfies me that the interests of justice are best served by upholding order 1 of the orders made by the primary judge.

229. The only reason advanced by the Attorney-General in support of the claim for costs of the present proceeding was that he was “the only active contradictor”. The Attorney-General was joined on his own application. I would decline to make an order in his favour for costs.

230. Mr Mohareb advanced no argument with respect to the 2 September 2019 orders (that he pay Mr Palmer’s costs, assessed in a gross sum). Notwithstanding that I have found that only half of the proceedings propounded by Mr Mohareb as vexatious were indeed vexatious, he has nevertheless succeeded in obtaining the orders he sought. That the primary judge went further, and made a more expansive order than that sought cannot be laid at Mr Palmer’s door.

231. I would not disturb the orders of 2 September 2019.

232. The orders I propose are:

1. Leave granted to appeal against the orders of 7 August 2019.

2. Appeal allowed in part.

3. Order 2 be set aside.

4. Appeal otherwise dismissed.

5. No order as to costs.

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Endnotes

Decision last updated: 11 December 2020