Swevenings Pty Ltd v Ferguson Consolidated Holdings Pty Ltd & Anor (No. 2)
[2008] FMCA 1582
•28 November 2008
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| SWEVENINGS PTY LTD v FERGUSON CONSOLIDATED HOLDINGS PTY LTD & ANOR (No.2) | [2008] FMCA 1582 |
| PRACTICE & PROCEDURE – Application to vacate hearing dates – prejudice – withdrawal of lawyers – medical condition of lawyer with conduct of the matter – efforts made to obtain representation – issue of effective representation – case management considerations. TRADE PRACTICES – Alleged breach of industry franchising code. |
| Federal Magistrates Act 1999 (Cth), ss.3, 22, 23, 42, 44, 45(1) Federal Magistrates Court Rules 2001 (Cth), rr.1.03, 9.02, 9.04, 12.03 Trade Practices Act 1974 (Cth), ss.51AD, 82, 87 Trade Practices (Industry Codes-Franchising) Regulations 1998 (Cth) |
| Bartucciotto v Western Health Care (2007) 94 ALD 387; [2007] FMCA 26 Coolstar Holdings Pty Ltd v Cleary & Ors [2007] FMCA 1684 Fazio v Centrelink [2008] FMCA 594 GEL Holdings Pty Ltd v ACN 082 310 727 Pty Ltd & Anor [2008] FMCA 266 Mahmoud v The Owners’ Corporation Strata Plan 811 (No.2) [2006] FMCA 1711 |
| Applicant: | Swevenings Pty Ltd |
| First Respondent: | Ferguson Consolidated Holdings Pty Ltd |
| Second Respondent: | Eric John Ferguson |
| File Number: | PEG 45 of 2008 |
| Judgment of: | Lucev FM |
| Hearing date: | 24 November 2008 |
| Date of Last Submission: | 24 November 2008 |
| Delivered at: | Perth |
| Delivered on: | 28 November 2008 |
REPRESENTATION
| Counsel for the Applicant: | Mr J. Hosgood |
| Solicitors for the Applicant: | MacKinlays |
| First Respondent: | Mr E.J Ferguson (by leave) |
| Second Respondent: | In person |
| Friend of the Court: | Mr P. Whight |
ORDERS
The respondents’ application for vacation of the hearing dates be granted.
The hearing dates of 10, 11 and 12 December 2008 be vacated.
The matter be adjourned to a directions hearing on 22 December 2008 at 9:30am.
The parties are to confer prior to the directions hearing on 22 December 2008 as to:
(a)the costs of:
(i) the respondents’ application for vacation of the hearing dates; and
(ii) any costs thrown away by reason of the order in (2) above vacating the hearing dates of 10,11 and 12 December 2008,
and otherwise costs are reserved;
(b)future programming orders, which are to:
(i) include provision for any further pleadings and affidavits (including expert reports) the parties consider necessary;
(ii) include provision for further mediation, and
(iii) provide for a listing for hearing on 14, 15, 16 and 17 April 2009 at 10:15am, in the event that further mediation is unsuccessful,
provided that if the parties cannot agree on future programming orders then each party is to file and serve a Minute of Proposed Orders by 12 noon on 19 December 2008.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PERTH |
PEG 45 of 2008
| SWEVENINGS PTY LTD |
Applicant
And
| FERGUSON CONSOLIDATED HOLDINGS PTY LTD |
First Respondent
| ERIC JOHN FERGUSON |
Second Respondent
REASONS FOR JUDGMENT
Introduction
The second respondent seeks to vacate the hearing dates set down for this matter on 10-12 December 2008.
On 20 November 2008 the second respondent filed an affidavit which provided as follows:
“I cannot find a replacement lawyer that can prepare for the court dates of 10, 11 and 12th of December 2008.
Mr. Hugo Lindsay of R.E Purvis cannot represent me as he has had surgery and has been in intensive care for a period, and has withdrawn from my case. The court rules state that my company must have a solicitor.
I rushed to appoint Mr. Lindsay as he was the only lawyer available and it has cost me $15,000 in costs due to his sickness and an adjournment.
Every lawyer I have spoken to needs at least three months to prepare the case and brief counsel.
I need to move the trial dates to the end of February allowing for the Christmas New Year period so that I can appoint a new lawyer.
I apologise for this but I have had a number of middle aged lawyers and don’t want to inconvenience Your Honour or the court anymore.”[1]
[1] Transcribed directly from original.
Background
The litigation history of this matter up until 18 September 2008 is set out in the judgment in Swevenings Pty Ltd v Ferguson Consolidated Holdings Pty Ltd & Anor.[2] Paragraphs 1 – 25 of Swevenings are adopted for present purposes.
[2] [2008] FMCA 1319 (“Swevenings”).
Swevenings summarised the position as at 18 September 2008 as follows:
That was the state of the evidence as it stood at 9.30am when this morning this matter came on for hearing. At that point in time the Court would have been entitled to conclude without anything further, that the respondents have not complied with Orders 2 and 3 of the Orders of the Court of 8 September 2008. Further, against the background of the failure to discover or provide inspection, and also the general history of the matter and the earlier orders made by this Court and the Federal Court in the proceedings, that there was evidence from which it might be inferred that the respondents had endeavoured to impede or thwart the discovery and inspection process.[3]
[3] Swevenings at para.26 per Lucev FM.
There were further developments at the hearing on 18 September 2008 including:
a)the withdrawal of the lawyers on record for the respondents at the outset of the hearing;
b)disclosure of the second respondent’s medical condition which had resulted in his overnight admission to hospital with a heart related complaint and various documents being provided to the Court associated with his ongoing heart condition.[4]
[4] Swevenings at paras.28-33 per Lucev FM.
In Swevenings the Court observed the conduct of the second respondent in relation to the provision of those various documents as follows:
The timing of the sending of these various documents does raise concerns about the conduct of the second respondent, when viewed against the background overall of the conduct of the litigation previously and the failure of the respondents to comply with orders of the Court.[5]
[5] Swevenings at para.32 per Lucev FM.
A further seven days was granted to comply with the Orders of the Court which related to discovery of various documents[6] and the Court ordered that the applicant’s costs of $1455 were to be paid by the respondents.
[6] “8 September 2008 Discovery Orders”.
To understand the matter in context it is necessary to have regard to the following observations made by the Court during the hearing on 8 September 2008:
…the whole history of this matter…having had a look at the file, smacks of both parties waiting until the death knock and then there’s a mediation or some other milestone…and then shying away from the thing.[7]
…there has simply been too much default all along the way by both parties I think in this matter to allow it to continue. And as I say if you can’t get expert reports within the time well we may just have to bat on regardless.[8]
I was going to ask whether you both wanted reasons for decision and the caveat I put on that is that both parties might not want me to reduce my thoughts to writing with respect to what’s happened here; and, in particular, might not want it – well, simply might not want my thoughts on it reduced to writing because I don’t think it would reflect particularly well on either of the parties concerned.[9]
[7] Transcript, 6 September 2008, p.6.
[8] Transcript, 6 September 2008, p.8.
[9] Transcript, 6 September 2008, p.13.
On 26 September 2008 the matter was adjourned to 2 October 2008 to allow further time for the respondents to comply with the 8 September 2008 Discovery Orders.
On 1 October 2008 the second respondent filed an affidavit which provided in part as follows:
Below is a list of legal practices I have contacted to represent me in the time frame without success;
[a list of 17 legal practices follows]
Today I have a commitment from Mr. Hugo Lindsay of R.E Purvis & Co. who cannot attend Thursday but can meet the trial date.
As it is most important that he attends all future hearings can Thursday be adjourned so that I can have proper legal advise. I have an appointment with him late Thursday afternoon the second of October.[10]
[10] Transcribed without amendment, but with emphasis added.
The Court notes that the hearing dates (initially set for 28 – 31 October 2008) were set down at a directions hearing on 10 June 2008.
On 2 October 2008 procedural orders were made and the respondents were ordered to pay the applicant’s costs of $2785. On that occasion the second respondent complained:
a)that his original lawyers Beere & Associates were exercising a lien over documents and refusing to release them; and
b)about the conduct generally of those lawyers in relation to the manner of their withdrawal from the case.
The Court indicated that:
a)four weeks before the hearing was sufficient time to prepare further affidavits (particularly in the context of ongoing discovery by the respondents); and
b)any complaint about the conduct of the former lawyer should be directed to the appropriate regulatory body.
On 13 October 2008 Mr Lindsay of R.E Purvis & Co.. appeared for the respondents. The respondents applied to adjust or vacate the hearing dates on the basis that Mr Lindsay had recently taken conduct of the matter and only had two weeks to prepare which was insufficient time. The application was made orally, effectively without notice and unsupported by any evidence. The application was dismissed and Reasons for Judgment were immediately given orally, which included that the respondents still had almost a month to prepare from when the second respondent’s affidavit was filed on 1 October 2008, that there was no evidence about what steps had been taken to prepare and there was, at the time of the hearing on 13 October, still a further two weeks to prepare.
Further procedural orders were made to facilitate the hearing then listed for 28-31 October 2008 and the respondents were ordered to pay the applicant’s costs in the sum of $307.50.
The Court notes that there was then no mention of any medical condition or illness that might prevent the lawyers then acting from continuing to act.
On 14 October 2008 a Notice of Address for Service was filed which named R.E Purvis & Co. and provided their address as the address for service. The Notice was signed by Mr Lindsay.
In accordance with Orders of the Court the applicant filed further affidavits and a further amended statement of claim. Two affidavits were filed within time. The further amended statement of claim was filed on 21 October 2008 and one affidavit was filed on 20 October 2008, which was four days and three days respectively later than that ordered by the Court, but understandable in light of the respondents ongoing failure to provide discovery in accordance with the 8 September 2008 Discovery Orders.
On 27 October 2008, a day before the hearing was to commence, the second respondent filed an affidavit which provided as follows:
My solicitor ADM Hugo Lindsay cannot represent me due to sickness for a week from the 23rd October 2008.
A Doctor’s certificate was attached and stated:
Alexander Lindsay will be unfit for work for 1 week.
A letter dated 24 October 2008 from Mr Lindsay to the second respondent was also attached and provided:
We refer to our telephone conversation on the 23rd October when you indicated that you were not prepared to accept the terms offered by Mackinlays and the writer said that in view of his current medical state, he could not do anything further for you.
We wish you the best in your continuing endeavours and we attach a copy of a medical certificate which was given to the writer for whatever use you may be able to make of it. For the avoidance of doubt, it reads “Alexander Lindsay will be unfit for work for 1 week” and it is dated the 23rd October and is signed by Dr Malcolm D Vincent.
Assuming the evidence in the affidavit is admissible the Court makes the following observations:
a)the barest of medical certificates was provided and there is no evidence about Mr Lindsay’s particular medical condition;
b)no explanation was provided as to why the name partner, R.E Purvis, or any other lawyer from the firm of lawyers on the record, was not able to take over the conduct of the matter;
c)there is no evidence of steps taken to brief counsel or instruct another firm of lawyers; and
d)critically, there was no evidence of what, if any, steps were taken by the respondents, or those acting for them, to have the matter ready for hearing in accordance with orders made by this Court. The illness was but one day prior to the hearing. There was no evidence of the preparation of further affidavits or an amended defence, nor of the existence of any drafts of those. No explanation for the lack of any evident preparation was given.
The application to vacate the hearing dates on 28-31 October 2008 was however consented to by the applicant, subject to the payment of costs, which were ordered in the sum of $15,000 to be paid by the respondents to the applicant.
Absent the consent of the applicant, the Court would probably not have granted the vacation of hearing dates then sought, and the Court made that apparent.
On 14 November 2008 R.E Purvis & Co. filed a Notice of Intention to Withdraw as a Lawyer. A Notice of Withdrawal as a Lawyer was filed on 25 November 2008, which was a day after the hearing of the current application to vacate the hearing dates.[11]
[11] A further affidavit was filed by the second respondent on 26 November 2008, but the Court has had no regard to that affidavit in preparing these Reasons for Judgment.
Further application for vacation of hearing dates
On 20 November 2008 the second respondent filed an affidavit which the Court has treated as an application for vacation of the December 2008 hearing dates.
In PS&M Pty Ltd v Elixir Marketing Pty Ltd[12] the Court observed that:
[12] [2008] FMCA 1331 (“Elixir Marketing”).
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.
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.[13]
[13] Elixir Marketing at paras.13-14 per Lucev FM (footnotes from the quotes have been omitted).
The Court notes that in Elixir Marketing both parties were represented but the principles set out apply in this matter.
Unavailability of a lawyer
The unavailability of a lawyer is not, of itself, a reason why the hearing dates should be vacated. Parties are often self-represented in proceedings in this Court. Less often are corporations represented other than by Counsel.
Section 44 of the Federal Magistrates Act 1999 (Cth)[14] provides that:
[14] “FM Act”.
A party to a proceeding before the Federal Magistrates Court is not entitled to be represented by another person unless:
(a) under the Judiciary Act 1903, the other person is entitled to practise as a barrister or solicitor, or both, in a federal court; or
(b) under the regulations, the other person is taken to be an authorised representative; or
(c) another law of the Commonwealth authorises the other person to represent the party.
Rule 9.04 of the Federal Magistrates Court Rules 2001 (Cth)[15] provides that:
Except as provided by or under an Act or regulations made under an Act, or with the leave of the Court, a corporation may not start or carry on a proceeding otherwise than by a lawyer.
[15] “FMC Rules”.
Therefore, a corporation can conduct proceedings other than by a lawyer, with the leave of the Court.
If it is necessary for a party (here, the second respondent) to be self-represented:
…the court can and will have regard to principles established that allow courts to deal with self-represented litigants and diminish (so far as possible) disadvantage suffered by an unrepresented litigant vis-à-vis a represented litigant, but not so as to have the presiding judicial officer “get into…[the unrepresented litigants] corner and provide them with tactical and other advice as to the consequences of certain actions.[16]
[16] Bartucciotto v Western Health Care (2007) 94 ALD 387 at 393-394 per Lucev FM; [2007] FMCA 26 at para.36 per Lucev FM [footnotes omitted] (“Bartucciotto”). There have been similar expressions of view by the Federal Court, both at first instance and on appeal: see the cases cited in Jarret v Westpac Banking Corporation [1999] FCA 425 at paras.80-81 per Mansfield J (“Jarret”).
The background to this case as set out above requires consideration. Two law firms have withdrawn as representatives of the respondents.
In June 2008 the matter was set down for hearing in October 2008 so the matter was in the Court list for at least four months. It was then set down for hearing in December 2008. When the October 2008 hearing dates were vacated, the respondents had known, since 24 October 2008 at least, that Mr Lindsay was not likely to be able to represent the respondents. An indication was given to the Court by the respondents on 28 October 2008 that R.E Purvis & Co. were going to withdraw as lawyers on the record, confirmed by the respondents in the course of the hearing of the current application.[17]
[17] Transcript, 24 November 2008, p.4.
There is no evidence that others within the firm of R.E Purvis & Co. were briefed, either to conduct or assist with the matter. There is no evidence of another firm, with the necessary expertise, being briefed to assist with the matter. There is no evidence that Counsel at the Independent Bar was ever briefed to advise or appear. No reason is proffered by the respondents as to why none of these steps have been taken. Ironically, the second respondent now says in his 20 November 2008 affidavit that lawyers spoken to since the last Court hearing say that they need three months “to prepare the case and brief counsel.”
Significantly, notwithstanding the involvement of the lawyers for the respondents, it appears that no case preparation has occurred since the matter was transferred to this Court. No further affidavit on the merits has been filed by the respondents since the filing in the Federal Court on 26 February 2008 of an affidavit sworn by the second respondent, and no amended defence or counterclaim has been filed. It remains the case that no current evidence explaining why that is so, or what if anything, has been done by way of preparation for hearing is before the Court, other than to say that the lawyers previously engaged have not carried out the work they were engaged to perform.
The Court notes that the second respondent says that since the hearing on 28 October 2008 he has spoken to lawyers, but there is no evidence who they are, or when that was done.
Other issues also need to be considered. A question arises as to whose fault it might be that the respondents are not prepared for the hearing listed in December 2008. It was suggested by Counsel appearing as friend of the Court that consideration ought to be given to the fact that the respondents’ original lawyers (Beer & Associates) had withdrawn at an advanced stage of the proceedings. That may be so, but is probably immaterial because the second respondent’s evidence in his affidavit of 1 October 2008 was that the respondents had been told by their new lawyers (R.E Purvis & Co) that they were in a position to conduct the hearing on 28 October 2008. Ultimately, the new lawyers did not do so because of the illness of Mr Lindsay, and the new lawyers did not even appear at the hearing on 28 October 2008. The new lawyers had however made their position on appearing at the hearing due to commence on 28 October 2008 clear a few days earlier. The evidence is that Mr Lindsay advised the respondents on 24 October 2008 that because of “his current medical state…[he] could not do anything further for [them]”, and Mr Lindsay, writing on behalf of the new lawyers, wished the respondents “the best in your continuing endeavours.”
At the hearing on 28 October 2008 the respondents told the Court that they had approached other lawyers for assistance, and that fact, together with the foregoing facts makes it clear that the respondents knew then that R.E Purvis & Co. would no longer be conducting the matter on their behalf. The subsequent filing of the Notice of Intention to Withdraw as Lawyer seems largely irrelevant in the circumstances.[18]
[18] As is the filing of the Notice of Withdrawal as Lawyer subsequent to the hearing of this application to vacate hearing dates.
Thus, as at 28 October 2008, the respondents had had lawyers engaged to assist them, for all but two weeks (18 September 2008 – 1 October 2008) of the time during which this matter has been before the Federal Court and this Court and neither of the firms concerned appear to have done sufficient work on the matter to ensure that it was being made ready for hearing. Indeed on the material before the Court it is open to conclude that no work has been done on the respondents hearing affidavits or amended pleadings since the matter had been transferred to this Court. The Court concludes that the fault for the lack of preparedness of the respondents as at 28 October 2008 lies with the lawyers acting for the respondents, not the respondents themselves. Since 28 October 2008 the respondents appear to have made further attempts to engage lawyers to conduct this case, but each has apparently said that they need at least three months to prepare the matter for hearing. That is probably not surprising given a three to four day trade practices matter involving alleged breaches of the Trade Practices (Industry Codes-Franchising) Regulations 1998 (Cth) and s.51AD of the Trade Practices Act 1974 (Cth),[19] and in which orders are sought under ss.82 and 87 of the TP Act for loss and damage, plus interest and costs.
[19] “TP Act”.
Thus, the respondents are now unable to engage lawyers to prepare the case for them, in circumstances where there has previously been a failure to prepare the case by the lawyers engaged by them.
This raises a further issue: do the respondents need lawyers to represent them? Strictly speaking they do not. The second respondent could self-represent, the first respondent could, with leave of the Court, be represented by the second respondent.[20] In any event, it is not, again strictly speaking the case that withdrawal of, or change of, legal representation shortly before a hearing will necessarily or even routinely warrant a court vacating hearing dates.[21]
[20] FMC Rules, r.9.04.
[21] Jarret at para.87 per Mansfield J (Carr J agreeing at para.26), cited in Forbes Engineering (Asia) Pty Ltd v Forbes [2007] FCA 1598 at para.18 per Collier J. (“Forbes Engineering”).
Consideration of the application for vacation of the December 2008 hearing dates requires however that the Court consider whether a failure to vacate these dates would be in accordance with the objects of the FM Act and the FMC Rules, and of particular relevance whether it would be “just” and “efficient”. As part of that consideration relevant matters include:
a)the efforts made by the respondents to obtain lawyers to represent them for the December 2008 hearing;[22] and
b)whether the respondents could effectively be represented by the second respondent (or some other non-legal person).[23]
[22] Jarret at para.87 per Mansfield J.
[23] Jarret at para.87 per Mansfield J.
The efforts of the respondents since the hearing of 28 October 2008 to obtain lawyers to represent them are referred to above.[24]
[24] See especially paras.2, 37 and 39 above.
There is not evidence of “strenuous efforts” to obtain lawyers as was the case in Jarret,[25] but rather that the second respondent on behalf of the respondents:
a)has spoken to lawyers;
b)that none of those lawyers can prepare the case and brief counsel within three months; and
c)that consequently, he has been unable to find lawyers, to replace his previous lawyers, to conduct the hearing on 10-12 December 2008.
[25] Jarret at para.87 per Mansfield J.
The Court accepts that the respondents have made proper efforts to obtain lawyers for the December 2008 hearing, but have been unable to do so. In regard to those efforts, there is no apparent fault to be found with the respondents.
As indicated above, a party being lawyerless does not preclude the Court from hearing a matter, and the Court has heard trade practices matters in which parties have been self-represented, or where corporations have been represented by persons who are not lawyers.[26]
[26] See for example, Coolstar Holdings Pty Ltd v Cleary & Ors [2007] FMCA 1684; Goodall v Nationwide News Pty Limited (No.2) [2007] AIPC 92-249; [2007] FMCA 1427; Klages & Ors v Walker & Anor [2007] FMCA 2056; Ibrahim v Considine Architects [2008] FMCA 1148.
However, the question which now squarely arises in this matter is whether the respondents can effectively be represented without lawyers, particularly in the timeframe concerned.[27] This question needs to be considered in a context where the respondents have, apart from a period of about two weeks from 18 September 2008 onwards, and then possibly from 24 October 2008 onwards, always been represented by lawyers. The respondents were entitled to rely upon the lawyers, particularly R.E Purvis & Co. (and especially Mr Lindsay who, on or about 1 October 2008, told the respondents that they could “meet the trial date”[28] which was then set to start on 28 October 2008), to take the requisite steps to prepare for the hearing. The fact that they did not so do is not, in all of the circumstances of this case, the fault of the respondents. Effectively, the respondents have been left holding the litigation baby in circumstances where the Court must consider whether they have the ability to properly care for it, within the relevant timeframe.
[27] Cf Jarret at para.26 per Carr J.
[28] See para.10 above.
The position in terms of the actual time available for the respondents to actually prepare is a little complicated. Although it appears that as early as 24 October 2008 R.E Purvis & Co. made it clear to the respondents that they were no longer acting for them, and they did not appear at the hearing on 28 October 2008 nor on the hearing of this application for the respondents, they did not file the Notice of Intention to Withdraw as Lawyer until 14 November 2008, and the Notice of Withdrawal as Lawyer until 25 November 2008 (the day after the hearing of this application).
Because the Court accepts that following the withdrawal of R.E Purvis & Co., the respondents have not been able to find lawyers who can prepare the matter in under three months it almost inexorably follows that it will not be possible for a non-legal person to properly prepare a case of this type in a lesser period, whether that period be six to seven weeks (from 24 October 2008) or two weeks (from 25 November 2008).
Assuming that the second respondent is the person who would represent the respondents, the Court also considers that the second respondent is not presently in a position to do so. It is clear from his presentation in Court that he has little understanding of the nature or scope of the proceedings. Further, when he has filed documents purporting to be “discovery affidavits” they have been piecemeal and disorganised. Affidavits are filed, but no application in proper, or any, form is made, where it is seemingly intended from the material in the affidavit that an application is to be made. The current application for vacation of the December 2008 hearing dates is a case in point: were it not for the alertness of Registry and Chambers staff the affidavit of
20 November 2008might have sat on the Court file until the December 2008 hearing. In all the circumstances, the Court is satisfied on the evidence now before the Court that:
a)there has been insufficient time since 24 October 2008 for a non-legal person to properly prepare the matter for the December 2008 hearing; and
b)the second respondent does not presently have a sufficient understanding of the nature and scope of the proceedings, or the relevant Court processes, to allow him to effectively represent the respondents at the December 2008 hearing.
Although the second respondent adverted to his medical condition in submissions there is no current medical evidence before the Court, and in the circumstances it is unnecessary to refer to the second respondent’s medical condition as grounds for the vacation of hearing dates.
The position of the applicant and what prejudice it suffers must be considered. The applicant was ready for hearing on 28 October 2008. Prejudice then suffered was remedied, if not in whole then certainly in part, by a costs order of $15,000, which the Court is informed (from the Bar table) has been paid. Presumably the applicant remains ready for the December 2008 hearing, nothing having changed in the respondents’ case in the interim. In those circumstances it is difficult to envisage any additional prejudice that might be suffered by the applicant other than what would be expected from the prolongation of the hearing beyond December 2008,[29] and which might not be remedied by an award of costs thrown away, if any.
[29] Forbes Engineering at para.19 per Collier J.
Prejudice might be suffered if, following any vacation of hearing dates, the respondents filed further affidavits and an amended defence. That is a prejudice which again might be remedied by appropriate costs orders, or adjustments to costs orders, following final hearing.
The Court has come to the view, subject to what is said below concerning case management, that the prejudice to be suffered by the respondents due to their not having a lawyer available to prepare for and appear at the December 2008 hearing is, within the timeframe, greater than any prejudice to be suffered by the applicant, and warrants vacation of the December 2008 hearing dates, because the respondents cannot otherwise presently be effectively represented.
Case management
Case management needs to be considered. The matter now is old: it commenced in the Federal Court in March 2006 and commenced in this Court on 10 March 2008. The applicant is (and was on 28 October 2008) as prepared as they can be in all the circumstances. The applicant is entitled to have their application heard.
From a pure case management perspective it would be appropriate to hear this case in December 2008. The Court has made strenuous endeavours to have the matter dealt with as expeditiously as possible. However, case management ordinarily gives way if a party will be unjustly prejudiced,[30] and in this Court, to whether the objects of the FM Act and FMC Rules have been met.[31]
[30] The State of Queensland & Anor v JL Holdings Pty Limited (1997) 189 CLR 146 (“JL Holdings”); 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.
[31] See para.26 above.
Pro-bono Assistance
Counsel appearing as a friend of the Court did suggest, perhaps tentatively, that the respondents might be assisted by a lawyer on the pro-bono panel.[32]
[32] FMC Rules, r.12.03.
The issue of pro-bono assistance and referral has been dealt with extensively by this Court in various matters including Bartucciotto and Fazio v Centrelink.[33] Although it is necessary to have regard to the factors under r.12.03 of the FMC Rules in determining an application for pro-bono assistance,[34] those factors can be dealt with shortly in this matter.
[33] [2008] FMCA 594 (“Fazio”).
[34] Bartucciotto ALD at 391-392 per Lucev FM; FMCA at paras.22-31 per Lucev FM; Fazio at paras.29-34 per Lucev FM.
Firstly, there is no evidence of the respondents’ means. There is no suggestion of insolvency on the part of the first respondent, or that the second respondent is indigent, or that either is otherwise unable to pay lawyers.
Second, whilst there is evidence of attempts to obtain legal assistance outside of the pro-bono referral scheme, it is not suggested that legal assistance is not available, merely that the time available for preparation prior to hearing is too short. A lawyer from the pro-bono panel would be in no better position.
Third, as to the nature and complexity of the proceeding, there is nothing that takes this proceeding outside of the ordinary run of proceedings in this Court involving alleged breaches of industry franchising codes.[35]
[35] See for example, GEL Holdings Pty Ltd v ACN 082 310 727 Pty Ltd & Anor [2008] FMCA 266; O’Connor v Roadrunner Mobile Video Pty Ltd & Ors [2006] FMCA 150.
Finally, other matters such as case management and the respondents’ ability to be represented by a non-legal person are otherwise dealt with in these Reasons for Judgment, and do not require further consideration in this context or provide grounds for a pro-bono referral.
Consideration
The Court must therefore balance the following considerations:
a)the objects of the FM Act and FMC Rules;
b)prejudice to both parties; and
c)case management (subject to the qualifications set out in para.57 above).
The objects of the FM Act requiring streamlined procedures, and, of the FMC Rules requiring just, efficient and economical resolution of proceedings may, in some circumstances, contain inherent tensions. This is one of those cases. Efficient and economical resolutions may not be the result of speedier proceedings, and speedier proceedings may in some instances provide unjust resolutions. This is a case where:
a)the lack of fault on the part of the respondents as to the withdrawal of their new lawyers (R.E Purvis & Co.);
b)the failure of the respondents’ lawyers to properly prepare for proceedings in this Court;
c)the lack of time for other lawyers to be instructed and properly prepare for the December 2008 hearings;
d)the lack of time for the respondents to have a non-legal person to properly prepare for the December 2008 hearings; and
e)the present inability of the second respondent to effectively represent the respondents,
are all factors which mean that a December 2008 hearing might result in injustice to the respondents, that injustice being greater than that which might result to the applicant if that hearing is vacated. In the circumstances, the interests of justice must prevail,[36] and the hearing dates must be vacated. Furthermore, it can probably be said that the hearing, at least, will be conducted more efficiently and economically if the parties are represented by lawyers, or a non-legal person (but not to the same degree as by lawyers), where they have had had time to prepare properly for the hearing. That view lends further support to the conclusion that the hearing dates must be vacated, notwithstanding the Court’s extreme reluctance to do so. The Court has therefore determined that the respondents’ application to vacate the December 2008 hearing dates must be granted.
[36] Forbes Engineering at paras.15-17 per Collier J citing relevant passages from JL Holdings at 154-155 per Dawson, Gaudron and McHugh JJ and 169-170 per Kirby J. See also Forbes Engineering at paras.18-19 per Collier J.
Future Conduct of the Proceedings
Given the vacation of the December 2008 hearing dates the issue of costs of the hearing of this application and the applicant’s costs thrown away of the December 2008 hearing arise. The Court will order that those costs be reserved, and that the parties confer as to those costs prior to a future directions hearing in the matter. If the parties cannot agree on those costs prior to the directions hearing, the Court will list the costs question for hearing.
The parties will also be ordered to confer prior to the future directions hearing on future programming directions which are to provide, at least, for the following:
a)the filing of any necessary amended pleadings and any further affidavits (including expert reports) by the parties;
b)provision for mediation;[37]
c)provision for listing for hearing for four days on 14, 15, 16 and 17 April 2009 at 10:15am.
[37] The matter was the subject of three mediation conferences in the Federal Court on 25 January 2007, 24 May 2007 and 20 November 2007, at which time it was adjourned to a date to be fixed. The matter has not been the subject of mediation in this Court. It should be as it may yet be of assistance in resolving the matter: FM Act ss.22-23.
If the parties cannot agree on programming orders the Court will make programming orders at a future directions hearing, and direct that the parties each file and serve Minutes of Proposed Orders beforehand.
The orders will provide for the matter to be adjourned to a directions hearing at 9:30am on 22 December 2008.
The orders to be made by the Court today reflect the current merits of the application for vacation of hearing dates. They are made, especially from a case management perspective, very reluctantly. They have been made in such as manner as to allow sufficient time for:
a)lawyers for the respondents to be briefed for the directions hearing on 22 December 2008;
b)lawyers to prepare for a hearing in April 2009;
c)non-legal persons, and in particular the second respondent, to prepare to run the proceedings on behalf of the respondents, as best can be done, in the event that the respondents are unable to obtain lawyers, or if those lawyers withdraw at any stage prior to the April 2009 hearing. The Court appreciates that if no lawyers are obtained by the respondents, or if they are obtained and then withdraw, any subsequent hearing in which non-legal persons (and in particular the second respondent) appears for the respondent, will be attended by the usual difficulties involved in a hearing where a party or parties are not legally represented. However, such persons are on notice that, in any event:
i)they must be prepared to conduct the hearing as best they can; and
ii)that will involve significant prior preparation on their part, whether or not lawyers are obtained.
Conclusion and orders
For the reasons set above orders will be made in the following terms:
a)The respondents’ application for vacation of the hearing dates be granted.
b)The hearing dates of 10, 11 and 12 December 2008 be vacated.
c)The matter be adjourned to a directions hearing on 22 December 2008 at 9:30am.
d)The parties are to confer prior to the directions hearing on 22 December 2008 as to:
i)the costs of:
(a)the respondents’ application for vacation of the hearing dates; and
(b)any costs thrown away by reason of the order in (2) above vacating the hearing dates of 10,11 and 12 December 2008,
and otherwise costs are reserved;
ii)future programming orders, which are to:
(a)include provision for any further pleadings and affidavits (including expert reports) the parties consider necessary;
(b)include provision for further mediation, and
(c)provide for a listing for hearing on 14, 15, 16 and 17 April 2009 at 10:15am, in the event that further mediation is unsuccessful,
provided that if the parties cannot agree on future programming orders then each party is to file and serve a Minute of Proposed Orders by 12 noon on 19 December 2008.
I certify that the preceding seventy-one (71) paragraphs are a true copy of the reasons for judgment of Lucev FM
Deputy Associate: Michele Lord
Date: 28 November 2008
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