FEDERAL COURT OF AUSTRALIA
Poole v Australian Pacific Touring Pty Ltd [2017] FCA 424
File number(s): NSD 1506 of 2016 Judge(s): BROMWICH J Date of judgment: 28 April 2017 Catchwords: PRACTICE AND PROCEDURE: Preliminary discovery – Whether test differs from test under previous rule – Whether prospective applicant required to reasonably believe they may have a right to obtain relief – Whether evidence of belief in the matters stipulated by the rule must be given personally by the prospective applicant – Whether prospective applicant’s right to relief sufficiently articulated – Relevance of documents sought to informing the prospective applicant’s decision to start proceedings – Federal Court Rules 2011 (Cth), r 7.23 Legislation: Competition and Consumer Act 2010 (Cth), Sch 2, ss 2, 23, 24, 27, 232, 250
Federal Court Rules 2011 (Cth), rr 1.32, 1.34, 1.35, 7.23, 8.21
Federal Court Rules 1979 (Cth), O 15 r 6
Cases cited: CGU Insurance Ltd v Malaysia International Shipping CorporationBerhad [2001] FCA 1223; (2001) 187 ALR 279
EBOS Group Pty Ltd v Team Medical Supplies Pty Ltd (No 3) [2012] FCA 48; (2012) 199 FCR 533
Evans Deakin Pty Ltd v Seable Furniture Ltd [2001] FCA 1772
Ferme v Kimberley Discovery Cruises Pty Ltd [2015] FCCA 2384
George v Rockett (1990) 170 CLR 104
Hooper v Kirella Pty Ltd (1999) 96 FCR 1
J & A Vaughan Super Pty Ltd v Becton Property Group Limited [2013] FCA 340
John Holland Services Pty Ltd v Terranora Group Management Pty Ltd [2004] FCA 679
ObjectiVision Pty Ltd v Visionsearch Pty Ltd [2014] FCA 1087; (2014) 108 IPR 244
Optiver Australia Pty Ltd v Tibra Trading Pty Ltd [2008] FCAFC 133; (2008) 169 FCR 435
R v JS [2007] NSWCCA 272; (2007) 230 FLR 276
Sandhurst Trustees Limited v Clarke [2015] FCAFC 21; (2015) 321 ALR 1
SmithKlineBeecham plc v Alphapharm Pty Ltd [2001] FCA 271
St George Bank Ltd v Rabo Australia Ltd [2004] FCA 1360; 211 ALR 147
Sydney Equine Coaches Pty Ltd v Gorst [2017] FCAFC 34
Voxson Pty Ltd v Telstra Corporation Limited (No 7) [2017] FCA 267
Date of hearing: 20 March 2017 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: Regulator and Consumer Protection Category: Catchwords Number of paragraphs: 106 Counsel for the Prospective Applicant: Mr J Potts SC Solicitor for the Prospective Applicant: James Tuite & Associates Counsel for the Prospective Respondent: Mr G Harris QC & Mr T Warner Solicitor for the Prospective Respondent: M&K Lawyers ORDERS
NSD 1506 of 2016 BETWEEN: KIMBERLEY JANE POOLE
Prospective Applicant
AND: AUSTRALIAN PACIFIC TOURING PTY LTD ACN 004 684 619
Prospective Respondent
JUDGE:
BROMWICH J
DATE OF ORDER:
28 APRIL 2017
THE COURT ORDERS THAT:
1.The parties are to provide either agreed or competing draft orders to give effect to these reasons within 14 days of the date of this judgment, or such further time as may be directed having regard…
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Details
- Case
- [2017] FCA 424
- Decision Date
CaseChat Overview and Summary
The case of Poole v Australian Pacific Touring Pty Ltd involved a dispute between Ms Poole, who had booked a river cruise through an agent, and APT, the travel service provider. Ms Poole sought an order for preliminary discovery of certain documents from APT under the Federal Court Rules 2011 (Cth) r 7.23. The legal issues before the Court were whether the test for preliminary discovery differed from the previous rule, whether a prospective applicant must reasonably believe they may have a right to obtain relief, whether evidence of belief must be given personally by the applicant, whether the applicant's right to relief was sufficiently articulated, and the relevance of documents sought in informing the applicant's decision to start proceedings.
The Court found that the test for preliminary discovery under r 7.23 did not differ from the previous rule, and that a prospective applicant must reasonably believe they may have a right to obtain relief. The Court also found that evidence of belief did not have to be given personally by the applicant, and that the applicant's right to relief was sufficiently articulated if it was reasonably arguable. Finally, the Court found that documents sought in a preliminary discovery application must be relevant to informing the applicant's decision to start proceedings.
The Court ordered that APT give preliminary discovery as sought by Ms Poole. The Court found that the documents sought were relevant to informing Ms Poole's decision to start proceedings, and that she had a reasonably arguable right to relief under the Australian Consumer Law. The Court also found that the burden on APT to provide the documents was not excessive, and that a confidentiality regime could be put in place to protect APT's commercial interests.
In terms of costs, the Court ordered that if proceedings were commenced within 60 days of the preliminary discovery process being completed, then the costs of the application and the reasonable expenses and any related reasonable costs of giving preliminary discovery be costs in the cause. If proceedings were not commenced within 60 days, then Ms Poole would pay APT's costs of the application and the reasonable expenses and any related reasonable costs of giving preliminary discovery. The parties were directed to provide either agreed or competing draft orders to give effect to these reasons within 14 days of the date of the judgment.
The Court found that the test for preliminary discovery under r 7.23 did not differ from the previous rule, and that a prospective applicant must reasonably believe they may have a right to obtain relief. The Court also found that evidence of belief did not have to be given personally by the applicant, and that the applicant's right to relief was sufficiently articulated if it was reasonably arguable. Finally, the Court found that documents sought in a preliminary discovery application must be relevant to informing the applicant's decision to start proceedings.
The Court ordered that APT give preliminary discovery as sought by Ms Poole. The Court found that the documents sought were relevant to informing Ms Poole's decision to start proceedings, and that she had a reasonably arguable right to relief under the Australian Consumer Law. The Court also found that the burden on APT to provide the documents was not excessive, and that a confidentiality regime could be put in place to protect APT's commercial interests.
In terms of costs, the Court ordered that if proceedings were commenced within 60 days of the preliminary discovery process being completed, then the costs of the application and the reasonable expenses and any related reasonable costs of giving preliminary discovery be costs in the cause. If proceedings were not commenced within 60 days, then Ms Poole would pay APT's costs of the application and the reasonable expenses and any related reasonable costs of giving preliminary discovery. The parties were directed to provide either agreed or competing draft orders to give effect to these reasons within 14 days of the date of the judgment.
Orders
Orders of the court
1. The parties are to provide either agreed or competing draft orders to give effect to these reasons within 14 days of the date of this judgment, or such further time as may be directed having regard to the likely need for a confidentiality regime, including as to the terms of the preliminary discovery order and as to costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
For the reasons set out below, including consideration of the proper construction of r 7.23, the Court will order that APT give preliminary discovery as sought by Ms Poole.BackgroundThe booking and cancellation of the river cruise The evidence in support of Ms Poole’s application has been adduced solely by way of an affidavit of 6 September 2016, including annexures, affirmed by Daniel Edward Thomas, a solicitor employed by Ms Poole’s solicitors. The facts giving rise to the dispute are uncontentious. On 30 September 2015, Ms Poole booked a “21 Day Magnificent Europe River Cruise” package for herself and her husband through Flight Centre Travel Group Limited, which acted as agent for APT, the travel service provider (the Booking). An invoice for the Booking was issued by Flight Centre on 3 October 2015. The invoice included details such as a total price of $30,030 for the package, a departure and return date in May 2016, and an itinerary detailing activities over 21 days in Paris, Amsterdam, Rüdesheim, Miltenberg, Bamberg, Nuremberg, Regensburg, Passau, Melk, Vienna, Budapest, and Prague. The invoice also recommended that Ms Poole purchase insurance for the trip, including cancellation cover, at a cost of $1,210 through an entity identified as Cover-More. It is apparent that travel insurance was obtained as an insurer is funding Ms Poole’s case. The invoice specified that bookings were made subject to the additional terms and conditions imposed by the “relevant service provider(s)”, in this case being APT. That aspect of the invoice is reproduced in part below (emphasis added):We act as an agent for, and sell various travel related products as agent on behalf of, numerous transport, accommodation and other service providers, such as airlines, coach, rail and cruise line operators, as well as all of our wholesalers.…All bookings are made on your behalf subject to the terms and conditions, including conditions of carriage and limitations of liability, imposed by these service providers. We can provide you with copies of the relevant service provider terms on request. Your legal rights in connection with the provision of travel services are against the specific provider and, except to the extent a problem is caused by fault on our part, are not against us. Specifically, if for any reason (excluding fault on our part) any travel service provider is unable to provide the services for which you have contracted, your rights are against that provider and not against us. APT’s separate terms and conditions as the service provider were not provided or identified to Ms Poole. Accordingly, the solicitors for Ms Poole inferred that the relevant terms are those set out in a brochure titled “Unforgettable Europe River Cruising 2016”, which they obtained from APT’s website (APT’s brochure). Following the hearing, APT confirmed to Ms Poole’s legal representatives that the terms of APT’s brochure and invoice constitute the entirety of the contract between the parties. Upon the basis of that concession, Ms Poole did not press a fourth category of documents, being those comprising the terms of the contract between her and APT.
Evidence
Evidence Before The Court
APT did not raise any objections to the correspondence as annexed to Mr Thomas’ affidavit and detailed above, nor did it seek to place any further communications into evidence. APT’s evidence The evidence relied upon by APT was contained in an affidavit sworn on 23 December 2016 by Felicity Dalle Nogare, a solicitor acting on its behalf. Ms Nogare deposed to 10 claims in the Federal Circuit Court, which she said have been commenced against APT in similar circumstances without the need for an application for preliminary discovery to be made. Those matters ostensibly concern claims in relation to APT seeking to withhold 100% of the cost of holiday packages in circumstances where tours have been cancelled less than 60 days prior to departure. No further details of the nature or circumstances of those claims were provided beyond the matter names and their file numbers. Ms Nogare also stated that APT’s arrangements with its suppliers are of a nature that is commercially sensitive and that APT is not in a position to disclose such arrangements. Disclosure of those arrangements, she is informed, would “affect APT’s relationship with suppliers … such that they may be unwilling to continue to do business with APT”. Ms Nogare estimated that the cost and burden to APT in relation to the present application is likely to be: “(a) approximately 10 hours away from the business; (b) approximately $6,000 plus GST to comply with the request for preliminary discovery; and (c) up to approximately $35,000 plus GST in legal costs and disbursements to oppose the application”.Relevant provisions of the Australian Consumer Law It is asserted in Mr Thomas’ affidavit that Ms Poole may have rights to relief against APT under s 24 of the Australian Consumer Law and under equity. No particulars of the claim in equity were identified, and senior counsel for Ms Poole did not place reliance on it for the present application. At the hearing, senior counsel for Ms Poole referred the Court to a number of further provisions of the Australian Consumer Law, which were said to support Ms Poole’s prospective right to relief against APT. Particular emphasis was placed on ss 23, 24 and 27, which are reproduced in full or in part below (as applied at the time of the Booking):23 Unfair terms of consumer contracts(1) A term of a consumer contract is void if:(a) the term is unfair; and(b) the contract is a standard form contract.(2)The contract continues to bind the parties if it is capable of operating without the unfair term.(3) A consumer contract is a contract for:(a) a supply of goods or services; or(b) a sale or grant of an interest in land;to an individual whose acquisition of the goods, services or interest is wholly or predominantly for personal, domestic or household use or consumption.24 Meaning of unfair(1) A term of a consumer contract is unfair if:(a)it would cause a significant imbalance in the parties’ rights and obligations arising under the contract; and(b)it is not reasonably necessary in order to protect the legitimate interests of the party who would be advantaged by the term; and(c)it would cause detriment (whether financial or otherwise) to a party if it were to be applied or relied on.(2)In determining whether a term of a consumer contract is unfair under subsection (1), a court may take into account such matters as it thinks relevant, but must take into account the following:(a) the extent to which the term is transparent;(b) the contract as a whole.(3) A term is transparent if the term is:(a) expressed in reasonably plain language; and(b) legible; and(c) presented clearly; and(d) readily available to any party affected by the term.(4)For the purposes of subsection (1)(b), a term of a contract is presumed not to be reasonably necessary in order to protect the legitimate interests of the party who would be advantaged by the term, unless that party proves otherwise.27 Standard form contracts(1)If a party to a proceeding alleges that a contract is a standard form contract, it is presumed to be a standard form contract unless another party to the proceeding proves otherwise.…
Decision
Reasons for decision
Once the first three issues above were resolved in favour of Ms Poole, the residual discretion to refuse relief in this case was almost entirely illusory. There remains a serious issue as to maintenance of confidentiality for the reasons set out in Ms Nogare’s affidavit, referred to above. Nonetheless, this Court routinely deals with highly confidential information, with high degrees of sensitivity and there is no reason to suppose that this cannot be done in the present case. With able and highly qualified representatives on both sides, the parties should be able to agree on a regime which adequately protects APT's commercial interests without the need for any further adjudication. However, such adjudication can be provided if agreement cannot be reached.Conclusion on ordering preliminary discovery An order for preliminary discovery in respect of the categories of documents sought by Ms Poole should be granted, but subject to a confidentiality regime of the kind referred to above.Costs The choices presented for the costs aspect of this application and of the reasonable expenses and any related reasonable costs of giving preliminary discovery may be distilled to the following:(1)If no order is made as to costs, then the costs of this application follow the event, because the application, which is interlocutory in substance, was successful after a contested hearing: r 40.04(a). Neither party contended for that outcome. It does not address the reasonable expenses and any related reasonable costs of giving preliminary discovery, and in all the circumstances would not be a just outcome if proceedings were not commenced, and probably would not be a just outcome if proceedings were commenced and did not succeed.(2)The substance of APT’s position, namely that Ms Poole pay APT’s costs of the application (although I note now that this would be despite the application being opposed unsuccessfully), with the addition of provision for the reasonable expenses and any related reasonable costs of giving preliminary discovery which was not specifically addressed by APT.(3)The substance of Ms Poole’s position, with the addition of provision for the reasonable expenses and any related reasonable costs of giving preliminary discovery which was not specifically addressed by Ms Poole, namely that:(a)if proceedings are commenced within a reasonable time after the preliminary discovery process is completed, then the costs of costs of and incidental to the application and the reasonable expenses and any related reasonable costs of giving preliminary discovery be costs in the cause; (b)if proceeding are not commenced within a reasonable time after the preliminary discovery process is completed, then Ms Poole pay APT’s costs of and incidental to the application and the reasonable expenses and any related reasonable costs of giving preliminary discovery. In all the circumstances, the appropriate order is that proposed by Ms Poole, with the adjustments incorporated above. The reasonable time referred to in (3) above was suggested in written submissions for Ms Poole to be 12 months, revised downwards to three months at the hearing. Even this revised time is too long for making a decision and commencing proceedings, given that no more is initially needed than an originating application, although a statement of claim would probably have to follow soon after. A reasonable time would be 60 days from the date upon which the preliminary discovery process is completed, which would probably be sufficient time for both an application and statement of claim. Accordingly the order as to costs should be to the effect that:(1)if proceedings are commenced within 60 days of the preliminary discovery process being completed, then the costs of costs of and incidental to this application and the reasonable expenses and any related reasonable costs of giving preliminary discovery be costs in the cause; (2)if proceeding are not commenced within 60 days of the preliminary discovery process being completed, then Ms Poole pay APT’s costs of and incidental to this application and APT’s reasonable expenses and any related reasonable costs of giving preliminary discovery.Orders
Ratio Decidendi
Legal Principle Established
Full text does not contain this section.