Re Fuller, Michael John; Wily, Hugh Jenner as Trustee of the Estate of Michael John Fuller v Fuller, Laima
[1998] FCA 948
•31 JULY 1998
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
SB 699 of 1993
RE:
BETWEEN:
MICHAEL JOHN FULLER
A BankruptHUGH JENNER WILY as Trustee of the Estate of
MICHAEL JOHN FULLER
First ApplicantM J FULLER SERVICES PTY LIMITED (in Liquidation)
Second ApplicantAND:
LAIMA ANN FULLER
First RespondentDAIVA CECELIA FULLER AND JOANA MARIA FULLER
Second RespondentsLYNN WILKINSON AND NORA WILKINSON
Third RespondentsST HELIER TRUST COMPANY LIMITED
Fourth RespondentsMICHAEL JOHN FULLER
Fifth RespondentJUDGE:
HILL J
DATE OF ORDER:
31 JULY 1998
WHERE MADE:
ADELAIDE
THE COURT ORDERS THAT:
Leave be given to file an amended statement of claim so far as concerns paragraphs 58 to 58(j) and 63 to 66 of the further amended statement of claim marked Exhibit 1 relating to the second respondents and paragraphs 46 to 46(h) and 51 to 57 so far as they relate to the first respondent.
The proceedings reflected in paragraphs 58 to 58(j) and 63 to 66 of the amended statement of claim relating to the second respondents be remitted to the Supreme Court of South Australia.
The applicants within 10 days file in this Court and serve upon the second respondents an amended application and statement of claim dealing only with the matters pleaded in paragraphs 58 to 58(j) and 63 to 66.
The second respondents file within a further 10 days defences to that statement of claim, it being noted that the Court has been advised that those defences will do no more than raise an issue that no payments were made either to the second respondents or to any person on their behalf or at their direction.
Upon the filing of the defence referred to in the last order, the proceedings constituted then by the amended application and statement of claim be remitted to the Supreme Court of South Australia. That the notice of motion for security for costs be stood over until the matter has been remitted in the event that the parties are unable to reach agreement.
The second applicant pay the costs of the second respondents in this Court.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
SB 699 of 1993
RE:
BETWEEN:
MICHAEL JOHN FULLER
A BankruptHUGH JENNER WILY as Trustee of the Estate of
MICHAEL JOHN FULLER
First ApplicantM J FULLER SERVICES PTY LIMITED (in Liquidation)
Second ApplicantAND:
LAIMA ANN FULLER
First RespondentDAIVA CECELIA FULLER AND JOANA MARIA FULLER
Second RespondentsLYNN WILKINSON AND NORA WILKINSON
Third RespondentsST HELIER TRUST COMPANY LIMITED
Fourth RespondentsMICHAEL JOHN FULLER
Fifth RespondentJUDGE:
HILL J
DATE OF ORDER:
31 JULY 1998
WHERE MADE:
ADELAIDE
EX TEMPORE REASONS FOR JUDGMENT
On 20 May 1997 the second applicant, M J Fuller Services Pty Ltd, a company in liquidation joined in the making of an application to this Court by Mr Wily, the trustee of the estate of Michael John Fuller, a bankrupt. Mr Wily was at all relevant times the liquidator of M J Fuller Services Pty Ltd. The application as originally framed sought relief, inter alia, against Daiva Cecilia Fuller and Joana Maria Fuller, the second respondents, and also Mrs Laima Fuller, requiring in respect of the second respondents that they deliver up the title to certain land in Government Road, Elliston, and in respect of Mrs Fuller, named as the first respondent, that she pay from the proceeds of sale of a property certain sums of money.
The statement of claim filed with that application alleged circumstances giving rise to a resulting trust in each case. The remainder of the proceedings, being those brought by Mr Wily as trustee of the bankrupt estate, were against other parties and on their face bore no relationship to the claims against the first and second respondents to which I have just referred.
The matter came before Mansfield J for directions on 25 March 1998. His Honour ordered a statement of claim to be filed and made other orders. I should say by way of correction to what I have earlier said that initially a statement of claim had not been filed. The application and statement of claim to which I have referred dated 28 May 1998 are those ultimately filed pursuant to Mansfield J's directions. However, it must also be noted that the time stipulated for filing the amended statement of claim by Mansfield J was not observed.
In the meantime a request for particulars was then made, dated 30 June 1998, on behalf of the various respondents seeking particulars of the resulting trust that had been alleged. Those particulars were never supplied.
Ultimately, on 3 July 1998 a further amended statement of claim and application were filed. It is said, and not denied, that orders had been made for filing of affidavits that were never complied with. The amended statement of claim of 3 July was apparently taken by the applicant as superseding the request for particulars and in the result that request for particulars went unanswered. For the first time, however, in the amended statement of claim dated 3 July 1998, the applicant put its case not on the basis of resulting trust but as a claim for payment of money arising out of certain circumstances, to which I will later return.
The proceedings including those involving the second respondents ultimately came before me on Wednesday last to deal with motions by various respondents either to strike out the proceedings or to deal with various pleading points. In the case of the second respondents, alternative motions were brought that the proceedings be, if not struck out, remitted to the Supreme Court of South Australia as being inappropriate to be dealt with in this Court, and having no connection with any of the proceedings in respect of which this Court clearly has jurisdiction.
It is not opposed by the second applicant, having regard to comments as to the defence that is to be lodged by all of the Fullers and their respective interests, that if the proceedings were not struck out they should be remitted to the Supreme Court of South Australia. The parties have not, as yet, agreed on another matter, namely the quantum of security that should be given by the insolvent company to the second respondents, but are however in agreement that that matter too should be left to the Supreme Court of South Australia. It would be inappropriate for this Court to endeavour to calculate an appropriate figure for security where the costs are those of another court.
In the course of the last three days the amended statement of claim as filed on 3 July has been the subject of further amendments, the last of which was made sometime around lunchtime today. The matters canvassed by the first and second respondents in respect of the initial pleading were undoubtedly sound and perhaps this is reflected by the amendments that have been made to the proceedings in the meantime.
It is not now in issue that the statement of claim, so far as it relates to the first and second respondents, discloses, if the facts are proven, a cause of action and no criticism is now advanced as to the form of the pleading. The question that does arise, however, is whether the second applicant in the proceedings against each of the Fullers should be given leave to file an appropriate pleading now raising again the issue of constructive trust which had been abandoned, as well as pleading a claim in restitution arising out of circumstances which, if proved, would give rise to a right of recovery.
Counsel for the second respondents and Mr Fuller on behalf of his wife both point to the history of the matter substantially as I have outlined it, although somewhat briefly. Counsel has emphasised that the second applicant has been out of time both in accordance with the initial direction of Mansfield J to file an amended statement of claim, as well as a failure to comply with orders to file affidavits. He has noted that one of his clients, Joana Maria Fuller, is a barrister practising in South Australia and has been required effectively to be in court for some three days while argument has been continuing. He says, in effect, that the second applicant has been given enough chances and should no longer be indulged in the process of continuing to refine the statement of claim so that it not only is properly pleaded, but also discloses an appropriate cause of action subject to proof of relevant facts. I should say that Mr Michael Fuller, who appears with my leave on behalf of his wife, adopts the same submissions although his attendance no doubt arises as well because he has been a party to other parts of the proceedings.
Counsel for the applicant emphasises by reference, inter alia, to what was said by the High Court in The State of Queensland v J L Holdings Pty Limited (1996-97) 189 CLR 146 that efficiency of case management cannot ultimately prevail over the interests of justice. Perhaps it might be said that the problems that have arisen in this case are not problems of case management but certainly in deciding whether to give leave to amend pleadings on numerous occasions it is appropriate to consider whether an amendment should be refused where ultimately a proper cause of action has been pleaded which, if able to be proved, would give rise to fundamental rights where the interests of justice hardly seems to require that additional new proceedings need to be commenced with further costs to everyone, where the matter can be appropriately dealt with in this Court.
I do have considerable sympathy for the respondents' position. It is unnecessary for me to express criticism of what has happened on the part of the applicants, but for whatever reason it has happened and caused, one might say, unnecessary expense to the respondents, not to mention the time that may no doubt have been needed to be spent or has been spent by Mrs Fuller. However, subject to this question of the resulting trust matter being initially pleaded, abandoned and revived, it is difficult to see how the respondents can be prejudiced, assuming an appropriate order for costs is made in their favour. The second applicant concedes it could not resist an order of costs in the circumstances.
Ultimately I think the interests of justice require leave that the pleadings be amended in the form in which they now are, so far as they concern the second respondents and also Mrs Fuller, the first respondent. That is to say, both the cause of action pleaded in resulting trust and the cause of action pleaded in restitution arise out of the same circumstances. One reason why I would not strike out the resulting trust proceedings is that the circumstances to be litigated in respect to the resulting trust alleged are precisely the same as those that require to be litigated in respect to the restitution matter, so that the two causes of action should more appropriately be heard together rather than that some other proceeding be commenced.
The pleadings being resolved and it being agreed that the part of the proceedings relating to the second respondents be transferred to the Supreme Court of South Australia, I make the following orders:
Leave be given to file an amended statement of claim so far as concerns paragraphs 58 to 58(j) and 63 to 66 of the further amended statement of claim marked Exhibit 1 relating to the second respondents and paragraphs 46 to 46(h) and 51 to 57 so far as they relate to the first respondent.
The proceedings reflected in paragraphs 58 to 58(j) and 63 to 66 of the amended statement of claim relating to the second respondents be remitted to the Supreme Court of South Australia.
The applicants within 10 days file in this Court and serve upon the second respondents an amended application and statement of claim dealing only with the matters pleaded in paragraphs 58 to 58(j) and 63 to 66.
The second respondents file within a further 10 days defences to that statement of claim, it being noted that the Court has been advised that those defences will do no more than raise an issue that no payments were made either to the second respondents or to any person on their behalf or at their direction.
Upon the filing of the defence referred to in the last order, the proceedings constituted then by the amended application and statement of claim be remitted to the Supreme Court of South Australia. That the notice of motion for security for costs be stood over until the matter has been remitted in the event that the parties are unable to reach agreement.
The second applicant pay the costs of the second respondents in this Court.
I certify that this and the preceding five (5) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Hill
Associate:
Dated: August 1998
Counsel for the Applicants: Mr G Palmer QC, with
Mr J ChippindallSolicitor for the Applicants: M D Nikolaidis & Co Counsel for the Second Respondents: Mr S Lane Solicitor for the Second Respondents: Lempriere Abbott McLeod Counsel for the Third Respondents: Mr C J Caldicott Solicitor for the Third Respondents: Caldicott & Co Counsel for the Fourth Respondent: Mr B O’Brien Solicitor for the Fourth Respondent: Finlaysons Mr M Fuller appeared in person and on behalf of the First Respondent Dates of Hearing: 29, 30 and 31 July 1998 Date of Judgment: 31 July 1998
0
0
0