Shafron v Australian Securities and Investments Commission (No 2)
[2013] NSWCA 144
•31 May 2013
Court of Appeal
New South Wales
Case Title: Shafron v Australian Securities and Investments Commission (No 2) Medium Neutral Citation: [2013] NSWCA 144 Hearing Date(s): On the papers Decision Date: 31 May 2013 Before: Beazley P at [1];
Barrett JA at [2];
Sackville AJA at [3]Decision: 1. Order 3 made in CA 2012/195077 be amended by replacing the words "in relation to the issue of approval of the Draft ASX Announcement" with the words "on liability" and deleting the words that follow "2009/298524".
2. There be no order for costs of the motion filed by the respondent.[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords: PROCEDURE - variation of orders - variation pursuant to Uniform Civil Procedure Rules, r 36.17 Legislation Cited: Corporations Act 2001 (Cth)
Uniform Civil Procedure Rules 2005Cases Cited: Australian Securities and Investments Commission v Hellicar [2012] HCA 17; 86 ALJR 522
Gillfillan v Australian Securities and Investments Commission [2012] NSWCA 370; 92 ACSR 460
Morley v Australian Securities and Investments Commission [2010] NSWCA 331; 81 ACSR 285
Morley v Australian Securities and Investments Commission (No 2) [2011] NSWCA 110; 83 ACSR 620
Newmont Yandal Operations Pty Limited v The J Aron Corporation [2007] NSWCA 195; 70 NSWLR 411
Shafron v Australian Securities and Investments Commission [2012] HCA 18; 86 ALJR 584Category: Procedural and other rulings Parties: Peter James Shafron (Appellant)
Australian Securities and Investments Commission (Respondent)Representation - Solicitors: Solicitors:
K&L Gates (Mr Shafron)
Clayton Utz (Australian Securities and Investments Commission)File Number(s): CA 2012/195077
JUDGMENT
BEAZLEY P: I agree with the reasons and orders proposed by Sackville AJA.
BARRETT JA: I agree with Sackville AJA.
SACKVILLE AJA: This is a notice of motion by the respondent ("ASIC") seeking an order amending Order 3 made by this Court on 12 November 2012 in 2012/195077 ("Mr Shafron's appeal"): Gillfillan v Australian Securities and Investments Commission [2012] NSWCA 370; 92 ACSR 460 at [363] ("Penalty Judgment").
Order 3 was made after the appellant ("Mr Shafron") and ASIC filed joint submissions in support of consent orders on penalty and costs in the proceedings between them. Those proceedings included hearings in the Court of Appeal (Morley v Australian Securities and Investments Commission [2010] NSWCA 331; 81 ACSR 285; Morley v Australian Securities and Investments Commission (No 2) [2011] NSWCA 110; 83 ACSR 620) and in the High Court (Australian Securities and Investments Commission v Hellicar [2012] HCA 17; 86 ALJR 522; Shafron v Australian Securities and Investments Commission [2012] HCA 18; 86 ALJR 584).
The joint submission incorporated the following in relation to costs orders:
8. By reason of the orders made by the High Court in proceedings Nos. S173 and S174 of 2011, ASIC is the successful party in the Court of Appeal proceedings No. 298416 of 2010.
9. As ASIC was the successful party in those proceedings, it is submitted that it is entitled to a costs order on the basis that costs follow the event (Uniform Civil Procedure Rules (UCPR) rule 42.1). In those proceedings, no special circumstances arise which could justify some other order.
10. Having regard to the matters outlined above and that:
(a) the appeal proceedings brought by each of the 7 non-executive directors of JHIL and Messrs Morley and Shafron (comprising 9 appellants) being proceedings No. 298416 of 2009, 298408 of 2009, 298425 of 2009, 298427 of 2009, 298428 of 2009, 298440 of 2009, 298441 of 2009, 298442 of 2009 and 298524 of 2009 in this Court (Appeal proceedings) were heard concurrently;
(b) a common set of appeal books was used in relation to each appeal and cross-appeal in the Appeal proceedings;
(c) orders were made on 12 February 2010 by this Court by which each party was to share e.law's costs attributable to establishing and maintaining the electronic court for the Appeal proceedings;
(d) the issue or group of issues (where issue means any disputed question of fact or law) to be determined in the Appeal proceedings were essentially the same such that it is appropriate to apportion ASIC's combined costs in relation to the Appeal proceedings equally between the appellants to those proceedings;
(e) any attempt to delineate the costs between each appeal would be artificial and could only be done on a rough approximation,the parties have agreed that the following costs orders should be made:
(f) Mr Shafron to pay one ninth of ASIC's costs of the Appeal proceedings on liability but not those costs incurred by ASIC in proceedings No. 298426 of 2009 (in relation to the appeal by James Hardie Industries NV);
(g) Mr Shafron to pay the costs of his appeal in relation to penalty and costs in proceedings No. 298416 of 2009 (but not ASIC's costs in relation to Mr Morley's appeal in relation to penalty and costs in proceedings No. 298408 of 2009).The parties proposed, relevantly, the following orders:
Mr Shafron pay one ninth of ASIC's costs of the proceedings on liability in proceedings No. 298416 of 2009, 298408 of 2009, 298425 of 2009, 298427 of 2009, 298428 of 2009, 298440 of 2009, 298441 of 2009, 298442 of 2009 and 298524 of 2009.
Mr Shafron pay ASIC's costs of the appeal on penalty and costs in proceedings No. 298416 of 2009.
In the Penalty Judgment, I explained (at [363]), the orders I proposed to make in Mr Shafron's appeal, as follows:
The following orders reflect the joint submissions made by the parties, with some editorial changes. Order 3 has been amended to correspond with the terms of the equivalent orders made in each of the other appeals.
The relevant costs orders made by the Court in Mr Shafron's appeal were as follows:
3. Mr Shafron pay one ninth of ASIC's costs of the proceedings in relation to the issue of approval of the Draft ASX Announcement in proceedings CA 2009/298408, 2009/298416, 2009/298425, 2009/298427, 2009/298428, 2009/298440, 2009/298441, 2009/298442 and 2009/298524 in relation to the issue of approval of the Draft ASX.
4. Mr Shafron pay ASIC's costs of the appeal on penalty and costs in proceedings CA 2009/298416.
ASIC has now filed a motion which in effect seeks the substitution of Order 3 as proposed by the parties for Order 3 as made by the Court. ASIC relies on Uniform Civil Procedure Rules, r 36.17, which permits the Court, if there is an error arising from an accidental slip or omission, in a judgment or order, to correct the mistake.
ASIC also relies, if necessary, on the Court's inherent jurisdiction to correct mistakes in orders, where the mistake leads to unintended consequences.
Mr Shafron opposes the motion. However, the parties are agreed that the motion should be dealt with on the papers. Mr Shafron does not appear to dispute that if the Court made Order 3 under a misapprehension as to what the parties intended to achieve and thus under a misapprehension as to the effect of its own order, the Court can and should correct the terms of Order 3 to achieve the result the Court intended: see Newmont Yandal Operations Pty Limited v The J Aron Corporation [2007] NSWCA 195; 70 NSWLR 411 at [41], [53], [60], [66], [79] and [116] per Spigelman CJ (with whom Santow JA and Handley AJA agreed).
I proposed Order 3 in the form made by the Court because I assumed that the reference to "liability" in Order 3 as proposed by the parties was co-extensive with the issue of approval of the Draft ASX Announcement. It was that issue which the High Court resolved in ASIC's favour and which was critical to establishing the liability of the other appellants for their contraventions of s 180(1) of the Corporations Act 2001 (Cth).
ASIC's submissions on the motion now make it clear that Mr Shafron raised other substantial arguments in support of his contention that he should not be found to have contravened the Corporations Act. Those arguments were rejected by this Court in the earlier judgment on liability.
Order 3 as made in the Penalty Judgment would have the effect, unintended by the parties and the Court, of depriving ASIC of the benefit of a costs order covering all untested questions relating to Mr Shafron's alleged contraventions of the Corporations Act. It is therefore appropriate that ASIC's motion should be granted and that Order 3 should be amended to correspond to the terms of the order sought by the parties.
Order
The following order should be made:
Order 3 made in CA 2012/195077 be amended by replacing the words "in relation to the issue of approval of the Draft ASX Announcement" with the words "on liability" and deleting the words that follow "2009/298524".
The motion does not seek costs. No order for costs should be made.
**************
0
6
2