Pearson v Secret Harbour Pty Ltd; Smith v Secret Harbour Pty Ltd; Gullan v Secret Harbour Pty Ltd; Blezard v Secret Harbour Pty Ltd; S. BOWMAN v Secret Harbour Pty Ltd; Aikman v Secret Harbour Pty Ltd; Lazenby v...
[2010] FMCA 249
•9 April 2010
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| PEARSON & ANOR v SECRET HARBOUR PTY LTD & ORS SMITH v SECRET HARBOUR PTY LTD & ORS GULLAN & ANOR v SECRET HARBOUR PTY LTD & ORS BLEZARD & ANOR v SECRET HARBOUR PTY LTD & ORS S. BOWMAN & ANOR v SECRET HARBOUR PTY LTD & ORS AIKMAN & ANOR v SECRET HARBOUR PTY LTD & ORS LAZENBY & ANOR v SECRET HARBOUR PTY LTD & ORS BUNCE & ANOR v SECRET HARBOUR PTY LTD & ORS G. BOWMAN & ANOR v SECRET HARBOUR PTY LTD & ORS MARTIN & ANOR v SECRET HARBOUR PTY LTD & ORS ASHRAT v SECRET HARBOUR PTY LTD & ORS | [2010] FMCA 249 |
| PRACTICE AND PROCEDURE – Default in compliance with previous orders – anticipated filing of new cross-claim. PRACTICE AND PROCEDURE – Application to adjourn mediation – factors for consideration. COSTS – Indemnity costs. |
| Genovese v BGC Construction Pty Ltd [2007] FMCA 601 |
| First Applicant: | KELVIN CLIVE PEARSON |
| Second Applicant: | SHELLEY ANNE PEARSON |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 85 of 2009 |
| Applicant: | MATTHEW JAMES SMITH |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 86 of 2009 |
| First Applicant: | PAUL VANCE GULLAN |
| Second Applicant: | HEIDI DAMGAARD GULLAN |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 87 of 2009 |
| First Applicant: | WILLIAM NEIL BLEZARD |
| Second Applicant: | JULIE FRANCES BLEZARD |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 88 of 2009 |
| First Applicant: | STEPHEN ROBERT BOWMAN |
| Second Applicant: | MICHAELA POTTS |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 89 of 2009 |
| First Applicant: | JAMES EDWARD AIKMAN |
| Second Applicant: | SUSAN RUTH AIKMAN |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 90 of 2009 |
| First Applicant: | GLEN ANDREW LAZENBY |
| Second Applicant: | JENNIFER DIANE LAZENBY |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 91 of 2009 |
| First Applicant: | CHRISTOPHER EDWARD BUNCE |
| Second Applicant: | WENDY JEAN BUNCE |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 92 of 2009 |
| First Applicant: | GARY DAVID BOWMAN |
| Second Applicant: | JULIE ANN SHAKESPEARE |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 93 of 2009 |
| First Applicant: | DANIEL TERENCE MARTIN |
| Second Applicant: | HELLEN FAITH MARTIN |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 130 of 2009 |
| Applicant: | MARIAM ASHRAT |
| First Respondent: | SECRET HARBOUR PTY LTD |
| Second Respondent: | SATTERLEY PROPERTY GROUP PTY LTD |
| Third Respondent: | ANNE BROWN |
| File Number: | PEG 174 of 2009 |
| Judgment of: | Lucev FM |
| Hearing date: | 9 April 2010 |
| Date of Last Submission: | 9 April 2010 |
| Delivered at: | Perth |
| Delivered on: | 9 April 2010 |
REPRESENTATION
| Counsel for the Applicants: | Mr J Hammond |
| Solicitors for the Applicants: | Hammond Legal |
| Counsel for the First Respondent: | Mr N Gentilli |
| Solicitors for the First Respondent: | Jackson McDonald |
| Counsel for the Second and Third Respondents: | Mr J Wyatt |
| Solicitors for the Second and Third Respondents: | Sparke Helmore |
ORDERS
Order 1 made on 19 February 2010 be discharged.
The first respondent have leave to file and serve:
(a)any Cross-Claim and affidavits in support thereof;
(b)any further affidavits on which they intend to rely in support of their Response; and
(c)a written outline of contentions of fact and law in relation to their Response and any Cross-Claim,
on or before 7 May 2010, failing which the applicants may apply for default judgment.
The second and third respondents’ application for adjournment of the mediation presently listed for 12 April 2010 be dismissed.
The first respondent pay the applicants’ costs of the directions hearing on 19 February 2010 fixed in the sum of $500.
The first respondent pay the costs of today fixed in the sum of $880 payable to the applicants and $880 payable to the second and third respondents.
The costs in orders 4 and 5 be payable by 23 April 2010.
In the event that the matter is not resolved beforehand by mediation that there be a further directions hearing at 11:00am on 24 May 2010.
AND THE COURT NOTES that the costs in orders 4 and 5 are the total costs in respect of all eleven applications.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PERTH |
PEG 85 of 2009
| KELVIN CLIVE PEARSON |
First Applicant
| SHELLEY ANNE PEARSON |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 86 of 2009
| MATTHEW JAMES SMITH |
Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 87 of 2009
| PAUL VANCE GULLAN |
First Applicant
| HEIDI DAMGAARD GULLAN |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 88 of 2009
| WILLIAM NEIL BLEZARD |
First Applicant
| JULIE FRANCES BLEZARD |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 89 of 2009
| STEPHEN ROBERT BOWMAN |
First Applicant
| MICHAELA POTTS |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 90 of 2009
| JAMES EDWARD AIKMAN |
First Applicant
| SUSAN RUTH AIKMAN |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 91 of 2009
| GLEN ANDREW LAZENBY |
First Applicant
| JENNIFER DIANE LAZENBY |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 92 of 2009
| CHRISTOPHER EDWARD BUNCE |
First Applicant
| WENDY JEAN BUNCE |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 93 of 2009
| GARY DAVID BOWMAN |
First Applicant
| JULIE ANN SHAKESPEARE |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 130 of 2009
| DANIEL TERENCE MARTIN |
First Applicant
| HELLEN FAITH MARTIN |
Second Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
PEG 174 of 2009
| MARIAM ASHRAT |
Applicant
And
| SECRET HARBOUR PTY LTD |
First Respondent
| SATTERLEY PROPERTY GROUP PTY LTD |
Second Respondent
| ANNE BROWN |
Third Respondent
REASONS FOR JUDGMENT
(Ex tempore reasons edited from the transcript)
This is an application by the second and third respondents for the adjournment of mediation which is due to occur in this matter on Monday, 12 April 2010 and associated cost issues.
It is appropriate to say something about the history of the matter. The applications were made on 15 June 2009. A response was filed on behalf of all three respondents on 1 July 2009 by solicitors then acting for all three respondents. The solicitors were Jackson McDonald, who continue now to act for the first respondent.
There was a first directions hearing on 24 July 2009, following which the applicants filed and served an amended application on 23 September 2009, their contentions of fact and law on 23 September 2009, and a further affidavit on 8 October 2009.
There was a second directions hearing on 23 October 2009, following which expert evidence from a valuer by way of affidavit was filed on 6 November 2009 on behalf of the applicants. On 23 October 2009, the Court made, relevantly, orders that the respondents file and serve:
a)any further affidavits on which they intend to rely; and
b)a written outline of contentions of fact and law by 4 pm on 18 December 2009;
and that the matter be adjourned for further directions at 9:45 am on 1 February 2010.
On 20 November 2009, the second and third respondents filed a notice of change of lawyer.
There was a consent order filed on 17 December 2009, and orders (1) and (2) of that consent order had the effect of extending time for the respondents to file their affidavits and contentions of fact and law to 1 February 2010, and also vacated and re-listed a directions hearing from 1 February 2010 to 19 February 2010.
Albeit late, the second and third respondents filed and served their affidavits and contentions of fact and law on 16 February 2010, three days before the third directions hearing on 19 February 2010, which had been listed as a consequence of the consent order. The first respondent did not file or serve any affidavits or contentions of fact and law in compliance with the consent order of 17 December 2009.
The third directions hearing took place on 19 February 2010, and at that directions hearing, there were orders which had the following effect:
a)to again extend the time for filing and service by the respondents, but effectively this time only by the first respondent, of affidavits and contentions of fact and law to 12 March 2010;
b)to refer the matter for mediation, which was to occur on or before 28 May 2010; and
c)to list a further directions hearing in the matter for 4 June 2010.
Today’s directions hearing was requested by the second and third respondents earlier this week. It occurs against a background which, from what the Court has recited, and the affidavit of Mr Graham[1] which has been tendered, appears to be as follows:
a)that the first respondent has failed to comply with orders to file and serve affidavits and contentions of fact and law by 12 March 2010. That has occurred despite three extensions of time in which to do so, and the first respondent is now in default of orders of the Court for a second time, and at this stage, by a period a weekend short of a month in respect of the last orders; and
b)in circumstances where more than six months has passed since the filing of the amended application and contentions of fact and law by the applicants, and more than six weeks has passed since the filing of affidavits and contentions of fact and law on behalf of the second and third respondents.
[1] Affidavit of Paul William Graham sworn 8 April 2010 (“Mr Graham’s Affidavit”).
It also occurs in circumstances where the first respondent has intimated an intention to file a cross-claim against the second and third respondents.
The first respondent, despite being in default twice of orders of this Court, has not concerned itself sufficiently with the matter to file any affidavit in the Court, or otherwise prior to today, endeavouring to explain the reason for its non-compliance. In that regard, it is seriously in default to the point where the issue of default judgment against the first respondent may well arise if the default is ongoing. Further, the intimation that there may be a cross-claim, which appears to have been made, or at least alluded to, appears to have been alluded to some months ago, if one looks at the content of the letter of 7 April 2010 from Spark Helmore to Jackson McDonald.[2]
[2] Mr Graham’s Affidavit, Annexures PWG 7-PWG 10.
It is a matter in respect of which, at this stage, no cross-claim has been filed and served and it also gives rise, as has been said in submissions and is referred to in that correspondence, to the possibility of the first respondent’s solicitors having a conflict. It is a possibility, and no more than that at this stage, on the papers. It is a possibility that there is a conflict by reason of the first respondent’s solicitors having previously acted for the second and third respondents.
In the circumstances the Court was minded to make orders that the first respondent have a further week to file and serve affidavits and contentions of fact and law in support of the response, and have the same period of time in which to file and serve any cross-claim and any affidavits in support of that and contentions of fact and law; that is, by 16 April 2010. That, when put to Counsel for the first respondent, met with a response which indicated that that was simply not possible in the circumstances.
As the Court has already indicated there has been no prior explanation by the first respondent as to the delay and, indeed, on the last occasion (on which Mr Louden appeared as Counsel), every indication was given to the Court that the first respondents would act without delay.
There has been some explanation given in relation to negotiations between the first, second and third respondents, as to whether or not the second and third respondents should also act for the first respondents, but as the Court has indicated that is not a matter which prior to Mr Graham’s Affidavit on the part of the second and third respondents, has been put in any way before the Court by the first respondent. It is self-evident, with respect, that the first respondent has simply failed to comply with the orders of the Court to the point where, should it do so again, the Court will be prepared to entertain an application for a default judgment against it. That said, and nothing having been said by Counsel for the second and third respondents or Counsel for the applicants as to the issue of time, the Court will afford the first respondent a further week so that it will have two weeks in which to get in order the affidavits and contentions of fact and law in support of the response, any application for a cross-claim and the affidavits of contentions of fact and law in support of any cross-claim.
The Court now turns to the question of the adjournment of the mediation. In the circumstances the issue is not without difficulty. Understandably, the second and third respondents say that their position is that they cannot go into a mediation with a threatened cross-claim which has not been formalised and which is not before the Court, not having been filed and served. However, the applicants, of whom there are eleven, would appear to have been put in a position where they are prepared for the mediation, which is due to proceed at 8.30 am next Monday, before Registrar Eaton, with all of the attendant pre-requirements of the mediation apparently having been met.
Were the mediation to now be adjourned the Court can envisage that the applicants would be severely disadvantaged. Given the nature of the mediation process, it may be that were the mediation to proceed on Monday the position of the respondents, at least vis-à-vis the applicants, might be clarified in some way, shape or form, whether it be that the applicants’ claims are denied and not settled and, therefore, proceed to trial, subject to any cross‑claim and any issue of conflict. Alternatively there may be some progress made in relation to a potential settlement, as between the applicant and the first, second and third respondents. The issue of the cross-claim need not necessarily be discussed at mediation on Monday. That is a matter, obviously, for the Registrar and the parties, but there will be no reason why any cross-claim could not be the subject also of an adjourned mediation. In those circumstances the Court is of the view that the mediation ought to proceed on Monday, and in that respect at least, the application for adjournment of the mediation fails.
The circumstances in which the application for adjournment of the mediation has failed are such that they have been brought about by circumstances where the first respondent is in default, not for the first time, and significantly in default, and in circumstances where a cross-claim is threatened against the second and third respondents about which, at least formally, there has been nothing filed and served at this stage. The Court, therefore, is of the view that the second and third respondents’ position is entirely understandable, and the Court considers that it is entirely proper that the application was brought. In those circumstances the Court considers that it is appropriate that the first respondent bear the costs of today.
As Mr Hammond for the applicants indicated, the question of the costs of the last occasion, that is, 19 February 2010, were reserved as between the applicant and the first respondent, and given that the first respondent continues to be in default notwithstanding the orders made on that day, the Court is of the view that the first respondent also ought to bear the costs, as between the applicant and the first respondent, of the directions hearing on 19 February 2010.
In the circumstances of this matter the costs of today and of 19 February are sought on an indemnity basis. The Court has regard for its judgment in Genovese v BGC Construction Pty Ltd,[3] in which it dealt with the relevant authorities concerning indemnity costs, including the fact that indemnity costs may be payable where a party is in default in relation to orders of the Court, which have caused the parties and the Court to incur further costs and inconvenience. That is certainly the case with respect to the costs of 19 February 2010 which arise by reason of the first respondent’s default. The costs of today arguably also arise by reason of the default of the first respondent in relation to the provision of its affidavits and contentions of fact and law, and the indication that a cross-claim would be filed and no cross-claim having been filed.
[3] [2007] FMCA 601.
Notwithstanding that there has been some indication of the possibility of a cross‑claim for some months, the Court is of the view that the applicants’ costs of the directions hearing on 19 February 2010 ought to be paid on an indemnity basis by the first respondent.
As to the costs of today, given all the circumstances, the explanations which have been given, and the orders that the Court otherwise proposes to make, the Court is of the view that the costs of today ought not be paid on an indemnity basis, but that the first respondent should, nevertheless, pay the costs of today of both the applicants and the second and third respondents, because it is essentially the default and non-compliance, and the position adopted by the first respondent, which has resulted in the matter being brought before the Court today in the circumstances that the Court has outlined.
I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for judgment of Lucev FM
Associate: S. Gough
Date: 14 April 2010
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