Sherwood v Commonwealth Bank of Australia

[2012] FCA 951

FEDERAL COURT OF AUSTRALIA

Sherwood v Commonwealth Bank of Australia [2012] FCA 951

Citation:		Sherwood v Commonwealth Bank of Australia [2012] FCA 951
Parties:		LESLIE JAMES SHERWOOD, JULIANNE SHERWOOD, SEAN PATRICK JUDE MCARDLE and PAULA JOANNE MCARDLE v COMMONWEALTH BANK OF AUSTRALIA ABN 48 123 123 124 and COLONIAL FIRST STATE INVESTMENTS LTD ABN 98 002 348 352
File number:		NSD 811 of 2010
Judge:		REEVES J
Date of ruling:		17 August 2012
Date of hearing:	17 August 2012
Place:	Brisbane
Division:	GENERAL DIVISION
Category:	No Catchwords
Number of paragraphs:	9
Counsel for Dr Anthony John Oliver and Dr Mark Allan Irving:	Mr SC Ipp
Solicitor for Dr Anthony John Oliver and Dr Mark Allan Irving:	Levitt Robinson
Counsel for the First Respondent:	Mr R Hollo SC
Solicitor for the First Respondent:	Clayton Utz

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 811 of 2010

BETWEEN:

LESLIE JAMES SHERWOOD
First Applicant

JULIANNE SHERWOOD
Second Applicant

SEAN PATRICK JUDE MCARDLE
Third Applicant

PAULA JOANNE MCARDLE
Fourth Applicant

AND:

COMMONWEALTH BANK OF AUSTRALIA
ABN 48 123 123 124
First Respondent

COLONIAL FIRST STATE INVESTMENTS LTD
ABN 98 002 348 352
Second Respondent

JUDGE:	REEVES J
DATE OF ORDER:	17 AUGUST 2012
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1.The application of Dr Anthony John Oliver and Dr Mark Allan Irving filed 23 March 2012, as amended 30 March 2012, be dismissed.

2.Dr Anthony John Oliver and Dr Mark Allan Irving pay to the Commonwealth Bank of Australia its costs of and incidental to that application.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 811 of 2010

BETWEEN:

LESLIE JAMES SHERWOOD
First Applicant

JULIANNE SHERWOOD
Second Applicant

SEAN PATRICK JUDE MCARDLE
Third Applicant

PAULA JOANNE MCARDLE
Fourth Applicant

AND:

COMMONWEALTH BANK OF AUSTRALIA
ABN 48 123 123 124
First Respondent

COLONIAL FIRST STATE INVESTMENTS LTD
ABN 98 002 348 352
Second Respondent

JUDGE:	REEVES J
DATE:	17 AUGUST 2012
PLACE:	BRISBANE

REASONS FOR RULING

1. This case is a representative proceeding brought pursuant to Pt IVA of the Federal Court of Australia Act 1976 (Cth) by Leslie Sherwood (Sherwood Proceedings).

2. Dr Anthony John Oliver and Dr Mark Allan Irving (Drs Oliver and Irving) are group members in the Sherwood Proceedings.  On 23 March 2012, Drs Oliver and Irving filed an application to partially opt-out.  This application was subsequently amended on 30 March 2012.  Drs Oliver and Irving filed this application to facilitate separate proceedings they had commenced in the New South Wales registry of this Court, which involved the same subject matter (New South Wales Proceedings). 

3. On 17 July 2012, Perram J ordered that the New South Wales Proceedings be permanently stayed and transferred those proceedings to my docket (Oliver v Commonwealth Bank of Australia (No 2) [2012] FCA 755 (Oliver)).

4. Mr Ipp, counsel for Drs Oliver and Irving, has indicated that, following Perram J’s decision, the partial opt-out application is no longer pressed and should, therefore, be dismissed.  Accordingly, the first Respondent, the Commonwealth Bank of Australia (Commonwealth Bank) seeks an order dismissing the application.  It also seeks an order for costs.

5. In the concluding paragraphs of Perram J’s decision in Oliver, his Honour declined to make a costs order against Drs Oliver and Irving in those proceedings because (at [25]):

   … until they formally failed to opt out of the representative proceedings on 23 March 2012 these proceedings were not an abuse of process.  The consequence of the permanent stay I have imposed will be that there will never be any determination of the outcome of these proceedings.

6. His Honour went on to state (at [26]):

   It may be that the work expended in these proceedings will ultimately lead to savings in the Sherwood proceedings.  On the other hand, there can be no certainty about that and the opposite may transpire to be the case. 

7. Then (at [27]), his Honour concluded: 

   That uncertainty requires a conclusion that the issue of costs not be determined until Dr Irving and Dr Oliver’s fates as members of the class in the Sherwood representative proceedings is known.  Now, then, is not the time for this issue to be resolved. 

8. Mr Ipp has argued that this application might similarly lead to savings being made in the Sherwood Proceedings and that, for the same reasons as expressed by Perram J in Oliver, costs should not be ordered in relation to this application until the Sherwood Proceedings have been determined.

9. While I readily accept the logic of the approach taken by Perram J in Oliver, I cannot see how this interlocutory application, which the applicants now concede should be dismissed, can possibly have any utility in the Sherwood Proceedings.  Furthermore, unlike in Oliver, once this application is dismissed, that will necessarily mean it will be finally determined.  Moreover, the Commonwealth Bank can legitimately claim it has thereby been entirely successful in the application.  In that event, the usual rule is that costs follow the event.  For these reasons, I see no reason why Drs Oliver and Irving should not be ordered to pay the Commonwealth Bank’s costs of their application.  I will so order.

I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Ruling herein of the Honourable Justice Reeves.

Associate:

Dated:        30 August 2012