Soden v Kowalski

Case [2011] FCA 318

FEDERAL COURT OF AUSTRALIA

Soden v Kowalski [2011] FCA 318

Citation: Soden v Kowalski [2011] FCA 318
Parties: WARWICK SODEN (IN HIS CAPACITY AS REGISTRAR OF THE FEDERAL COURT OF AUSTRALIA) v KAZIMIR KOWALSKI and MITSUBISHI MOTORS AUSTRALIA LIMITED, MMAL STAFF SUPERANNUATION FUND PTY LTD and AMP SUPERANNUATION LTD
File numbers: SAD 75 of 2010
SAD 96 of 2010
Judge: STONE J
Date of judgment: 7 April 2011
Catchwords:

PRACTICE AND PROCEDURE – application pursuant to ss 21 and 23 Federal Court of Australia Act 1976 (Cth) and O 21 r1 and O 35 r 1 Federal Court Rules to have respondent declared a vexatious litigant – order sought preventing respondent from bringing further proceedings against the applicants and generally in this Court without leave – discussion of principles – meaning of ‘proceeding’ – discussion of ‘vexatious proceeding’– vexatiousness a quality of the proceeding not the respondent’s intention – test is whether a proceeding is so obviously untenable or manifestly groundless as to be utterly hopeless – question of whether respondent has instituted proceedings ‘habitually, persistently and without reasonable grounds’ not to be confused with whether proceeding is vexatious – requirements of O 21 rr 1 and 2 satisfied – orders granted

Legislation:

Federal Court of Australia Act 1976 (Cth) ss 4, 21 and 23, s 59(2)(l)
Supreme Court Act 1935 (SA) s 39(5)

Federal Court Rules O 21 rr 1, 2, 4 and 5, O 35 r 1

Cases cited:

Attorney-General for the State of Victoria v Horvath, Senior [2001] VSC 269
Attorney-General v Collier [2001] NZAR 137
Attorney-General v Wentworth (1988) 14 NSWLR 481
Bahonko v Nurses Board of Victoria [2008] FCAFC 29
Brogden v Attorney-General [2001] NZAR 809
Commonwealth Trading Bank v Inglis (1974) 131 CLR 311
Gallo v The Honourable the Attorney-General VSC 4 September 1984 (unreported) Starke J
GSA Industries Pty Ltd v NT Gas Ltd (1990) 24 NSWLR 710
Horvarth v Commonwealth of Australia [1999] FCA 504
Hunters Hill MunicipalCouncil v Pedler [1976] 1 NSWLR 478
IMF (Australia) Ltd v Sons of Gwalia Ltd (2004) 211 ALR 231
Jones Lang Lasalle (Qld) Pty Ltd v Dart [2005] FCA 1614 Granich & Associates v Yap [2004] FCA 1567
Jones v Skyring (1992) 109 ALR 303 at 312

Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2007 [FCA] 1069 

Ramsey v Skyring (1999) 164 ALR 378
Re Vernazza [1960] 1 QB 197
Watson v Watson (1968) 70 SR(NSW) 203

Date of hearing: 1 and 2 December 2010
Place: Adelaide
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 211
SAD 75 of 2010
Counsel for the Applicant: T Duggan
Solicitor for the Applicant: EMA Legal
Appearance for Respondent: The respondent appeared in person
SAD 96 of 2010
Counsel for the Applicants: VM Heath
Solicitor for the Applicants: Thomsons Lawyers
Appearance for Respondent: The respondent appeared in person

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 75 of 2010
BETWEEN:

WARWICK SODEN (IN HIS CAPACITY AS REGISTRAR OF THE FEDERAL COURT OF…

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AGLC
Soden v Kowalski [2011] FCA 318
Case
[2011] FCA 318
Decision Date

CaseChat Overview and Summary

Soden v Kowalski is an application by Mitsubishi Motors Australia Ltd, MMAL Staff Superannuation Fund Pty Ltd and AMP Superannuation Ltd to have Kazimir Kowalski, the respondent, declared a vexatious litigant. The applicants seek orders preventing the respondent from bringing further proceedings against them and generally in the Federal Court without leave. The primary issue before the court was whether the respondent had instituted proceedings habitually, persistently, and without reasonable grounds. The court also considered the meaning of a "proceeding" and the test for determining whether a proceeding is vexatious.

The court found that the requirements of the relevant rules were satisfied. The evidence showed that the respondent had instituted numerous proceedings against the applicants, many of which were found to be vexatious in other courts and tribunals. The court held that vexatiousness is a quality of the proceeding, not the respondent’s intention. The test for determining whether a proceeding is vexatious is whether it is so obviously untenable or manifestly groundless as to be utterly hopeless. The court found that the respondent had instituted proceedings habitually, persistently, and without reasonable grounds, satisfying the requirements of the relevant rules.

Accordingly, the court granted the orders sought by the applicants, prohibiting the respondent from instituting or continuing any proceedings in the Federal Court or against the applicants without leave. The respondent was also ordered to pay the applicants' costs.

Orders

Orders of the court

2. Kazimir Kowalski, the respondent in this proceeding, not institute any further proceeding in this Court without the leave of the Court.

3. Any proceeding instituted prior to this order by Kazimir Kowalski, the respondent in this proceeding, not be continued without the leave of the Court.

4. The respondent’s notice of objection to competency be dismissed.

5. The respondent pay the applicant’s costs of this proceeding.

3. Kazimir Kowalski, the respondent in this proceeding, not institute any further proceeding in this Court against any or all of the applicants, Mitsubishi Motors Australia Ltd, MMAL Staff Superannuation Fund Pty Ltd and AMP Superannuation Ltd without the leave of the Court.

4. Any proceeding instituted prior to this order by Kazimir Kowalski, the respondent in this proceeding, against any or all of the applicants, Mitsubishi Motors Australia Ltd, MMAL Staff Superannuation Fund Pty Ltd and AMP Superannuation Ltd not be continued by him without the leave of the Court.

5. The respondent’s notice of objection to competency be dismissed.

6. The respondent pay the applicants’ costs of this proceeding.

Note:

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Ms Bochner also provided “a chronological summary of the corresponding Federal Court decisions in relation to proceedings instituted by the Respondent”. She lists 33 decisions in respect of which written reasons were given. I have added another decision (number 34) that was relied upon by the applicants and discussed in their submissions although not listed in Ms Bochner’s affidavit. The citations for those decisions and other relevant details are as follows:1.Kowalski v Mitsubishi Motors Australia Ltd (1998) FCR 55, SG 100 of 1997, 16 October 1998;2.Kowalski v Mitsubishi Motors Australia Ltd Staff Superannuation Fund Pty Ltd [2002] FCA 1153, SAD 190 of 2001, 17 September 2002;3.Kowalski v Trustee of Mitsubishi Motors Australia Limited Staff Superannuation Fund Pty Ltd [2003] FCA 14, SAD 234 of 2002, 15 January 2003;4.Kowalski v Trustee, Mitsubishi Motors Australia Limited Staff Superannuation Fund Pty Ltd [2003] FCAFC 18, SAD 234 of 2002, 28 February 2003;5.Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2007] FCA 1069, (2000) 242 ALR 370 SAD 11 of 2007, 24 July 2007;6.Kowalski v MMAL Staff Superannuation Fund Pty Ltd (No 2) [2008] FCA 691, SAD 11 of 2007, 20 May 2008;7.Kowalski v Mitsubishi Motors Australia Ltd [2008] FCA 1873, SAD 171 of 2008, 4 December 2008;8.Kowalski v Repatriation Commission [2008] FCA 1970, SAD 168 of 2008, 22 December 2008;9.Kowalski v Repatriation Commission [2009] FCA 47, SAD 216 of 2008, 30 January 2009;10.Kowalski v Mitsubishi Motors Australia Ltd [2009] FCA 48, SAD 205 of 2008, 3 February 2009;11.Kowalski v Repatriation Commission [2009] FCA 153, SAD 3 of 2009, 27 February 2009;12.Kowalski v Repatriation Commission [2009] FCA 794, SAD 168 of 2008, 30 July 2009; 13.Kowalski v Repatriation Commission [2009] FCAFC 107, (2009) 259 ALR 444; SAD 26 of 2009, 14 August 2009;14.Kowalski v Mitsubishi Motors Australia Ltd [2009] FCA 991, SAD 171 of 2008, 3 September 2009;15.Kowalski v MMAL Staff Superannuation Fund Pty Ltd [2009] FCAFC 117, (2009) 259 ALR 319; SAD 20 of 2009, 9 September 2009;16.Kowalski v Military Rehabilitation and Compensation Commission [2009] FCA 1044, SAD 75 of 2009, 17 September 2009;17.Kowalski v Chief Executive Officer of Medicare Australia [2009] FCA 1072, SAD 81 of 2009, 23 September 2009;18.Kowalski v Mitsubishi Motors Australia Ltd [2009] FCA 1289, SAD 133 of 2009, 9 November 2009;19.Kowalski v Chief Executive Officer of Medicare Australia [2009] FCA 1420, SAD 165 of 2009, 2 December 2009;20.Kowalski v Superannuation Complaints Tribunal [2009] FCA 1466, SAD 159 of 2009, 9 December 2009;21.Kowalski v Military Rehabilitation and Compensation Commission [2010] FCA 5, SAD 160 of 2009, 15 January 2010;22.Kowalski v Superannuation Complaints Tribunal [2010] FCA 104, SAD 1929 of 2009, 19 February 2010;23.Kowalski v Military Rehabilitation and Compensation Commission [2010] FCAFC 10, (2010) 114 ALD 8; SAD 15 of 2009, 22 February 2010;24.Kowalski v Repatriation Commission [2010] FCAFC 19, SAD 112 of 2009, 5 March 2010;25.Kowalski v Complete Exhaust Specialists [2010] FCA 222, SAD 13 of 2010, 16 March 2010;26.Kowalski v Chief Executive Officer of Medicare Australia [2010] FCA 265, SAD 203 of 2009, 16 March 2010;27.Kowalski v Military Rehabilitation and Compensation Commission [2010] FCA 408, SAD 75 of 2009, 30 April 2010;28.Kowalski v Repatriation Commission [2010] FCA 409, SAD 176 of 2009, 30 April 2010;29.Kowalski v Cole, Sim and RJ Cole Partners [2010] FCA 410, SAD 1 of 2010, 30 April 2010;30.Kowalski v Chief Executive Officer of Medicare Australia [2010] FCA 411, SAD 34 of 2010, 30 April 2010;31.Kowalski v Complete Exhaust Specialists [2010] FCA 412, SAD 35 of 2010, 30 April 2010;32.Kowalski v Chief Executive Officer of Medicare Australia [2010] FCA 413, (2010) 185 FCR 42; SAD 203 of 2009, 30 April 2010;33.Kowalski v Superannuation Complaints Tribunal [2010] FCA 473, SAD 159 of 2009, 14 May 2010. 34.Kowalski v AMP Superannuation Limited [2010] FCA 1170, SAD 29 of 2010, 4 November 2010. Evidence of applicants in SAD 96 of 2010

Decision

Reasons for decision

Mr Kowalski appealed from the decision of Mansfield J. After filing the notice of appeal from Mansfield J’s decision, Mr Kowalski attempted to file a notice of motion seeking discovery of documents from the respondents. On 15 January 2003, Spender J directed that the Registrar not accept the motion or the supporting affidavit or take any further action to process the notice of motion. His Honour held that there was no basis on which the orders sought by Mr Kowalski should be made and that the motion was “truly an abuse of process”: Kowalski v Trustee of Mitsubishi Motors Australia Limited Staff Superannuation Pty Ltd [2003] FCA 14. As the notice of motion was not accepted for filing no proceeding was instituted by the notice of motion. SAD 234 of 2002 – appeal from decision in SAD 190 of 2001 The Full Court dismissed the appeal from Mansfield J’s decision on 28 February 2003: Kowalski v Trustee Mitsubishi Motors Australia Limited Staff Superannuation Pty Ltd [2003] FCAFC 18. The Full Court’s comments in dismissing the appeal echoed comments that had been made at first instance. The Full Court noted, at [10], that one interesting feature of Mr Kowalski’s argument was that he did not attack the validity of the Heads of Agreement:He accepts that it is binding. He does not repudiate it. He has no intention of repaying the money paid to him under it. He merely says that the agreement cannot keep him from his entitlement to receive the moneys that are lawfully his, if those moneys exceed the amount payable under the agreement. From what one could understand, the appellant was asking the Court to calculate whether more was due to him by way of award and other statutory entitlements and under the Superannuation Deed than he had received pursuant to the Heads of Agreement and then to order that the excess (if any) together with such further sums as was sought should be paid to the appellant. The Full Court, at [19], agreed with Mansfield J that any rights that Mr Kowalski may have had arising out of the termination of his employment merged into the rights he acquired under the Heads of Agreement and that his rights against his former employer did not go beyond those reflected in the Heads of Agreement. In conclusion the Full Court said at [30]:For the reasons given above, it is unnecessary for us to agree with all aspects of His Honour’s reasoning. However, in relation to the Employer we agree with Mansfield J that the executed Heads of Agreement provide a complete defence. In the absence of any disclosed basis for challenging that agreement the appellant has no prospects of success in his action and Mansfield J was correct to dismiss it. In relation to the Superannuation Trustee we agree that there is no jurisdiction to hear that claim and it should be struck out. Mansfield J was correct to make orders under Order 20 Rule 2 of the Federal Court Rules dismissing the action. The appeal should be dismissed. For reasons given in relation to proceeding SAD 190 of 2001, the appeal was vexatious. There were no reasonable grounds for the application or the appeal. As the Full Court said, the Heads of Agreement was a complete answer to Mr Kowalski’s claim and thus to his appeal. Federal Court: SAD 11 of 2007 and SAD 20 of 2009 SAD 11 of 2007 – application for compensation and damages

Ratio Decidendi

Legal Principle Established

Despite the Heads of Agreement and Mitsubishi’s payment of $200,000 pursuant to the Agreement the respondent continued to institute proceedings against Mitsubishi alleging, inter alia, that the Agreement should be set aside on the ground that Mitsubishi did not negotiate it in good faith and that he signed it under duress; see, for instance, Kowalski v Mitsubishi Motors Ltd [2001] AIRC 1212 at [11] – [16]. Mr Kowalski apparently sees no inconsistency between this stance and his view that he is not obliged to return the money paid by Mitsubishi.Vexatious litigant declaration in Supreme Court of South Australia - 19 April 2005 The numerous proceedings brought by the respondent led Mitsubishi to seek a declaration in the Supreme Court of South Australia that the respondent was a vexatious litigant. On 19 April 2005 Bleby J made a declaration in those terms and ordered that Mr Kowalski be prohibited from instituting further proceedings against Mitsubishi or a related entity in the State Courts of South Australia without the leave of the Supreme Court; Mitsubishi Motors Australia Ltd v Kowalski [2005] SASC 154. Most of the proceedings said to be vexatious in the proceeding before Bleby J were proceedings instituted by the plaintiff in the Workers Compensation Tribunal, which is constituted under the Workers Rehabilitation and Compensation Act 1986 (SA). A preliminary question was whether the Tribunal was a court for the purpose of Mitsubishi’s application. The question was answered in the affirmative in Mitsubishi Motors Australia Ltd v Kowalski [2004] SASC 302. The application before Bleby J was made under s 39 of the Supreme Court Act 1935 (SA) which provides for declaration such as Mitsubishi sought in the case of the institution of vexatious proceedings. Section 39(5) of that Act provides that proceedings are vexatious:(a)if instituted to harass or annoy, to cause delay, or for any other ulterior purpose; or(b)if instituted without reasonable ground. His Honour considered 45 decisions that had been referred to by Mitsubishi in support of its application to have Mr Kowalski declared a vexatious litigant. Of those proceedings, the plaintiff had submitted that 29 were vexatious. In relation to those 29, his Honour found that 24 (one of which involved ten separate proceedings, all disposed of in one decision) were vexatious, four were not vexatious and one was not a proceeding but an application made in the course of a proceeding. With respect to that application, however, his Honour observed, at [232], that it nevertheless illustrated, “the continued attempts by the defendant to thwart the legitimate process of the Court”. His Honour also referred to multiple proceedings that had been brought between 1998 and 2005 in courts and tribunals to which s 39 did not apply. They included proceedings commenced in the Australian Industrial Relations Commission, the Federal Court and the Legal Practitioners’ Disciplinary Tribunal. His Honour commented that the plaintiff had brought those proceedings to the attention of the Court “in order to demonstrate the full extent of the defendant’s seemingly endless pursuit of litigation against the plaintiff and those connected with the plaintiff”. In response to Mr Kowalski’s objection to the irrelevance of these matters, his Honour further observed, at [265]:It is important to consider the respective positions of the parties in the broad context of all of the litigation that has occurred. … However, the weight which can be given to the institution of such proceedings, and to the outcomes and findings therein, is necessarily much less than the weight which I have placed on the decision outlined above. They are relevant only to the extent that they form part of the background and history of the disputes between the parties, which background and history might, in a particular case, have some bearing on whether one or more of the proceedings the subject of s 39 were instituted vexatiously.