PS&M Pty Ltd v Elixir Marketing Pty Ltd

[2008] FMCA 1331

FEDERAL MAGISTRATES COURT OF AUSTRALIA

PS&M PTY LTD v ELIXIR MARKETING PTY LTD [2008] FMCA 1331

TRADE PRACTICES – Misleading and deceptive conduct.

PRACTICE & PROCEDURE – Adjournment – principles – prejudice and case management.

Federal Magistrates Act 1999 (Cth), ss.3, 14, 42 and 18
Federal Magistrate Court Rules 2001 (Cth), r.1.03

Trade Practices Act 1974 (Cth), ss.52, 86A and 86AA

Goodall v Nationwide News [2007] FMCA 218
Mahmoud v The Owners’ Corporation Strata Plan 811 (No.2) [2006] FMCA 1711
Myers v Myers [1969] WAR 19
Patrick v Wadoon Pty Ltd (No.2) [2007] FMCA 1766
The State of Queensland & Anor v JL Holdings Pty Limited (1997) 189 CLR 146

Applicant: PS&M PTY LTD (TRADING AS ELIXIR MARKETING GROUP)

Respondent: ELIXIR MARKETING PTY LTD

File Number: PEG 55 of 2008

Judgment of: Lucev FM

Hearing date: 22 September 2008

Date of Last Submission: 22 September 2008

Delivered at: Perth

Delivered on: 22 September 2008

REPRESENTATION

Counsel for the Applicant: Mr Vogt

Solicitors for the Applicant: Vogt Graham Lawyers

Counsel for the Respondent: Ms Parker

Solicitors for the Respondent: Salter Power

ORDERS

1. The time for the Applicant to file and serve any affidavits be extended to 30 September 2008.

2. The time for which the Respondents file and serve any affidavits be extended to 10 October 2008.

3. Costs be in the cause.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

PEG 55 of 2008

PS&M PTY LTD (TRADING AS ELIXIR MARKETING GROUP)

Applicant

And

ELIXIR MARKETING PTY LTD

Respondent

REASONS FOR JUDGMENT

(Ex tempore - edited and revised from the transcript)

Introduction

1. The substantive application in these proceedings seeks relief in the Court’s trade practices jurisdiction under ss. 86A and 86AA of the Trade Practices Act 1974 (Cth)[1] with respect to alleged misleading and deceptive conduct under s.52 of the TP Act, and also in the Court’s associated jurisdiction under s.18 of the Federal Magistrates Act 1999 (Cth)[2] in relation to alleged passing off.

   [1] “TP Act”.

   [2] “FM Act”.

2. The proceedings were commenced by way of application and statement of claim filed on 9 April 2008.

Adjournment application

1. By correspondence forwarded to the Court earlier today, the respondent sought to further vacate existing orders of the Court, including mediation and hearing dates.  The letter is in the following relevant terms:

   We write to seek to vacate the mediation conference listed for this matter on 23 September 2008 and to extend the milestones ordered by Magistrate Lucev on 15 August 2008.[3] A copy of the minute of consent orders signed by the parties is attached.

   The principal reason why the parties seek to vacate the mediation conference and extend the milestones is due to the fact that they are still engaged in informal negotiations which may result in a resolution of the matter. The parties are anxious not to incur additional legal costs, whilst that informal process is underway. 

   The parties recognise that there have been previous orders vacating a mediation conference listed for 14 August 2008 and extensions to the milestones on 5 May, 18 June and 4 August 2008.  However, the informal negotiations were interrupted, due to both parties being interstate or overseas, in the previous three weeks.

   Certainly, if those negotiations do not bear fruit, the parties will resort to the timetable contemplated in the attached minute.

   [3] The reference to “Magistrate” is incorrect. The FM Act provides that the Court is to consist of justices, being a Chief Federal Magistrate and Federal Magistrates: FM Act, s.(8)4. Schedule 1 to the FM Act provides that a Federal Magistrate is to be styled “Federal Magistrate (name)” or “(name) FM”: FM Act, Schedule 1, cl.2(2). See also >

   The Court notes that nothing is said with respect to the hearing dates, that have been vacated a number of times and the Court further notes that, in any event, there were further orders made vacating or adjusting earlier orders, on 15 August 2008. In the ordinary course, having regard to ss.3, 14 and 42 of the FM Act and r.1.03 of the Federal Magistrates Court Rules2001 (Cth),[4] there would be nothing exceptional in the request made earlier today.  But in this case there are other circumstances and they are:

   a)the paucity of reasons given in the letter and evidence in support for the further vacation; and

   b)the litigation history of this particular matter. 

   [4] “FMC Rules”.

Litigation History

1. In relation to the litigation history, as indicated, the litigation was commenced on 9 April 2008, by application and statement of claim.

2. It came before the Court on the first Court date on 5 May 2008. In accordance with the general practice of this Court it was listed through to hearing on that day, with orders for the filing of a defence, a reply, affidavits, various procedural orders to do with the evidence, outlines of submissions and was listed for hearing for two days, on 26 and 27 August 2008, and also referred for mediation, before a Registrar of this Court, to occur on or before 7 August 2008.  A defence was filed, in accordance with those orders, on 19 May 2008, but there was no reply filed.

3. According to the Court file, the respondent wrote to the Court, on 17 June 2008 and referred to “informal settlement discussions” and on the basis of the pursuit of those discussions, sought that the Court approve consent orders between the parties. The Court did that, and on 18 June 2008, made consent orders in the terms sought by the parties, but setting a specific hearing date. The Court notes that the mediation, which was set for on or before 7 August 2008 under the earlier orders, was shifted to on or before 4 September 2008 under the new orders, and that the hearing dates of 26 and 27 August 2008, were reset for 14 and 15 October 2008. The Court notes that the hearing dates of 26 and 27 August 2008 were then unable to be refilled with other hearings. 

4. According to the Court file the parties were advised by the Court of a mediation conference listed for 14 August 2008 and that was advised to them on 7 July 2008.

5. On 14 July 2008 the applicant’s solicitors wrote to Registrar Eaton again referring to “informal settlement discussions” and seeking the vacation of the mediation conference on 14 August 2008. It would appear that that was vacated.

6. On 1 August 2008 the applicant’s solicitors also wrote to the Court, seeking that orders be made, by consent, vacating the hearing listed for 14 and 15 August 2008 and also seeking various other procedural consent orders, in similar terms, but with different dates to orders previously made.  Those orders were made by consent, on 4 August 2008.  The Court notes that the mediation, previously on or before 4 September 2008, was shifted to on or before 22 September 2008, and hearing dates of 14 and 15 October 2008, were shifted to the current hearing dates of 11 and 12 November 2008.  The Court notes that those hearing dates of 14 and 15 October 2008, have been able to be filled. 

7. On 15 August 2008 the applicant’s solicitors again wrote to the Court, again seeking consent orders, and again consent orders were made in terms of the orders which were made by the Court on 15 August 2008.  On this occasion, the dates for other interlocutory steps were again extended, the hearing date was not changed, but the time for mediation was put back from 22 September 2008 to 13 October 2008.

8. On 20 August 2008, the parties were advised of a listing for mediation, which was set for 23 September 2008, at 10.15am. In relation to the orders made on 15 August 2008, the time by which the applicants were to file affidavits, was extended to 3 September 2008, but that time has now expired and there has been no application for an extension of that time. Further, the time by which the respondent was to file affidavits, which was 17 September 2008, has also expired and there has been no application for an extension of that time. Neither side has complied with those orders. Neither party has sought to explain that failure to comply with orders of the Court, in the submissions made today - other than perhaps by inference, by reference to the informal settlement negotiations and the progress that has been evidently made in them.

Consideration

1. It is against that background that the further consent order, forwarded to the Court today, needs to be considered. As indicated to the parties, at the outset, the Court’s view is that a further adjustment of the dates for the various interlocutory processes would need to be justified, particularly given that the time for some of them has now expired (and most relevantly the affidavit evidence for the hearing) and that this would involve a fourth re-setting of the hearing date.  It is almost six months since the application was filed.  As indicated, it has twice been listed for hearing and vacated.  It has also been listed a number of times for mediation and vacated and it is also sought to vacate tomorrows mediation. The hearing now listed for 11 and 12 November 2008, is sought to be vacated.  There is no prospect, if it were to be vacated, of it being heard before the second or third week of March 2009, almost 12 months after the filing of the application.  Speaking generally, that is unacceptable in terms of the objects of the FM Act and the FMC Rules and the purposes for which this Court was set up.  In Goodall v Nationwide News the Court said as follows:

   Reading together the objects of the Federal Magistrates Act in section 3, the mode of operation in section 42 and having regard to the objects of the Federal Magistrates Court Rules, in rule 1.03, it is apparent that the Court is intended to operate in a manner:

   (a) as informal as possible in the exercise of judicial power;

   (b) which is not protracted in its proceedings;

   (c) which resolves proceedings justly, efficiently and economically;

   (d) uses streamlined procedures; and

   (e) avoids undue delay, expense and technicality.[5]

   [5] [2007] FMCA 218 at para. 21 per Lucev FM (“Goodall”).

2. It is in that statutory context set out in Goodall that the current application needs to be considered. As a secondary consideration, regard has to be had to the relevant authorities which it is necessary for the Court to consider in relation to an adjournment of proceedings that is, to consider the questions of prejudice and case management, the latter not outweighing the former except in the most obvious cases.[6] 

   [6] The State of Queensland & Anor v JL Holdings Pty Limited (1997) 189 CLR 146; Myers v Myers [1969] WAR 19; Patrick v Wadoon Pty Ltd (No.2) [2007] FMCA 1766 and Mahmoud v The Owners’ Corporation Strata Plan 811 (No.2) [2006] FMCA 1711.

3. In terms of prejudice, it has been put that there will be increased costs if the matter continues to run in the way in which it is presently scheduled to run.  Informal settlement negotiations appear to have been ongoing and certainly were first adverted to in correspondence to the Court over three months ago. The Court notes that counsel for the applicant indicated that the settlement negotiations which have seemingly been ongoing have arrived at a point where the parties are only apart on a dollar difference and that the proceedings must, having regard to that difference, settle at some point in time. Those submissions as to the progress of those negotiations was not demurred from in any way by counsel for the respondent.

4. The Court observes that the question of costs is, of course, a normal incident of litigation. Further, if the matter does go to mediation tomorrow, given that there is only seemingly a small dollar difference between the parties it might be that the matter is able to be settled with the assistance of a Registrar tomorrow and if the parties are able to settle the matter tomorrow then, of course, the question of additional costs becomes moot.  The matter might not settle at mediation tomorrow because of the failure to file affidavit evidence, although given the extent to which the parties have progressed towards settlement, that might not be as much of an impediment to settlement as it would be in the ordinary course of events.

5. The Court notes that the consent orders forwarded this morning are late in terms of the proceedings and just seven weeks out from the date for which the matter is now listed for hearing, and a day before a listed mediation. In effect, it requires the Court to vacate the existing processes and start the interlocutory processes again. 

6. In terms of the settlement negotiations reducing costs, it is noted that at this stage no settlement has resulted despite the apparent best efforts of the parties.  The Court considers that the question of the incurring of future costs has to be balanced against other considerations, particularly the question of case management. The Court has adverted to the fact that the parties have missed certain case management deadlines, notably the filing of affidavit evidence in relation to the hearing.  In those circumstances, the Court considers that that is a matter which would need to be remedied if the hearing is to proceed.

7. In terms of case management, the Court considers it undesirable that a matter such as this should have to be listed for hearing for a fourth time, close to 12 months after the initial application is made to the Court and that such course is contrary to the objects of both the FM Act and the FMC Rules, notwithstanding the progress that has been made towards settlement of the proceedings which is also an object of the FM Act and the FMC Rules.  To re-list the matter again also means that other litigants who, in the ordinary course, would have been able to be allocated hearing dates on 11 and 12 November 2008 will not be able to be allocated those dates given that they are only now seven weeks away. 

8. There are other considerations. The Court notes the consent of the parties and takes account of that but there simply comes a time when the Court must take some control of the processes before it and now, particularly given the narrowness of the issues in dispute between the parties, seems to be an appropriate time in the context of the circumstances of this case.  There is, the Court notes, no guarantee of settlement and as observed in exchanges with counsel it seems to the Court that the best incentive to settlement now might be the proximity of a hearing date. The Court takes the view that the constant reshuffling and missing of deadlines and the vacation of the hearing dates in respect of this matter is undesirable in the context of case management in a lower level court in the federal system, given the objects for which this Court was established and, in particular, the avoidance of protraction and delay in the final resolution of matters.

9. It seems to the Court that the better course is:

   a)for the parties to continue their negotiations in any event; and

   b)for the matter to go to mediation tomorrow. 

10. Whether given the distance between the parties the mediation tomorrow is adjourned for a short time to allow the parties to endeavour to settle it themselves, whether they seek the assistance of the Registrar to settle it tomorrow or whether the mediation tomorrow is adjourned in either of those events is a matter for the Registrar to consider tomorrow.  Suffice to say that the Court will not vacate the mediation presently scheduled for 10.15am tomorrow.

11. The considerations to which the Court has referred mean that in all of the circumstances, it does not consider that there is any sufficient prejudice to either party such as to warrant an adjournment or a vacation of the existing hearing dates and in terms of case management considerations, that those do weigh in favour of the matter not being further adjourned or the hearing vacated. They weigh, in the balance, and having regard to what the Court has been told today about how far the parties are apart in negotiations, notwithstanding that, the Court is still of the view that the existing hearing dates ought to be maintained.  The existing mediation date for tomorrow ought to be maintained and that weighs again in the balance, that date having been fixed for some time, and it also weighs in the balance having regard to the fact that it may, in fact, assist rather than retard a settlement between the parties.  There is nothing, in any event, to preclude ongoing settlement negotiations as an adjunct to the Court’s processes and if, indeed, the parties are correct, the Court considers that the Court processes, both mediation and hearing, are more likely to settle the matter quickly.

12. In the circumstances there will be no orders in terms of the orders filed by consent by the parties, but it is necessary to allow the parties the opportunity to file their affidavit evidence for the hearing scheduled for 11 and 12 November 2008 and orders will be made to facilitate that filing.

I certify that the preceding twenty-four (24) paragraphs are a true copy of the reasons for judgment of Lucev FM

Deputy Associate:  Michele Lord

Date:  3 October 2008