Tenement Administration Services Pty Ltd v Hodson

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FEDERAL COURT OF AUSTRALIA

Tenement Administration Services Pty Ltd v Hodson [2013] FCA 610

Citation: Tenement Administration Services Pty Ltd v Hodson [2013] FCA 610
Parties: TENEMENT ADMINISTRATION SERVICES PTY LTD (ABN 71 007 397 873) v EDEN MAREE HODSON, UTM GLOBAL PTY LTD and DESIREE JULIE BIRD
File number: QUD 627 of 2011
Judge: COLLIER J
Date of judgment: 20 June 2013
Catchwords: PRACTICE AND PROCEDURE – interlocutory application to vary self-executing order – self-executing order made by consent – where effect of self-executing order is dismissal of application – discretionary power – relevant considerations – case management – solicitor fault
Legislation: Federal Court of Australia Act 1976 (Cth) ss 37M, 37N
Federal Court Rules 2011 (Cth) r 39.04
Cases cited: Andresakis v Alexus Holdings Pty Ltd (2006) 68 NSWLR 507 cited
Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175 cited
Burgoine v Taylor (1878) 9 Ch D 1 cited
FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268 cited
Goodwill Group Pty Ltd v Pongrass Associates Pty Ltd [2002] FCA 1203 cited
Goodwill Group Pty Ltd v Pongrass Associates Pty Ltd [2003] FCAFC 51 cited
Jess v Scott (1986) 12 FCR 187 cited
Jowett v Kelly [2008] NSWSC 1009 cited
R v Secretary of State for the Home Department; Ex parte Mehta [1975] 1 WLR 1087 cited
Stollznow v Calvert [1980] 2 NSWLR 749 cited
Taylor v Taylor (1979) 143 CLR 1 cited
Date of hearing: 10 April 2013
Place: Brisbane
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 54
Counsel for the Applicant: Mr C Jennings
Solicitor for the Applicant: Conradie & Associates
Counsel for the Respondents: Mr A Fraser
Solicitor for the Respondents: Hemming+Hart Lawyers

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

GENERAL DIVISION

QUD 627 of 2011
BETWEEN:

TENEMENT ADMINISTRATION SERVICES PTY LTD (ABN 71 007 397 873)
Applicant
AND:

EDEN MAREE HODSON
First Respondent

UTM GLOBAL PTY LTD
Second Respondent

DESIREE JULIE BIRD
Third Respondent

JUDGE:

COLLIER J

DATE OF ORDER:

20 JUNE 2013

WHERE MADE:

BRISBANE

THE COURT ORDERS THAT:

1.The interlocutory application filed on 25 February 2013 be dismissed.

2.The costs of the respondents of and incidental to the interlocutory application filed on 25 February 2013 be paid by the applicant’s solicitors on an indemnity basis.

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


IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

GENERAL DIVISION

QUD 627 of 2011
BETWEEN:

TENEMENT ADMINISTRATION SERVICES PTY LTD (ABN 71 007 397 873)
Applicant
AND:

EDEN MAREE HODSON
First Respondent

UTM GLOBAL PTY LTD
Second Respondent

DESIREE JULIE BIRD
Third Respondent

JUDGE:

COLLIER J

DATE:

20 JUNE 2013

PLACE:

BRISBANE

REASONS FOR JUDGMENT

  1. On 25 February 2013 the applicant to the substantive proceedings filed the interlocutory application presently before the Court. The applicant seeks an order to vary self-executing orders of the Court dated 6 February 2013, as a result of which the originating application…

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Details
Case
[2013] FCA 610
Decision Date

CaseChat Overview and Summary

In the Federal Court of Australia, Tenement Administration Services Pty Ltd, an entity engaged in mineral land administration, brought a case against former employee Ms Hodson and another respondent, alleging misuse of confidential information and equipment to establish a competing business. The applicant sought an injunction and other orders to prevent the respondents from using its confidential information and equipment. The Court initially issued interlocutory orders to restrain the respondents from using the applicant’s confidential information and performing similar services. However, subsequent timetabling orders were not adhered to by the applicant, leading to the current interlocutory application seeking to vary those orders. The Court was required to determine whether it should exercise its discretion to vary the previously made orders, particularly in light of the applicant’s failure to comply with the timetabling orders and the seriousness of the consequences of such non-compliance.

The Court considered the principles governing the exercise of its discretion to vary orders, including the overarching purpose of the civil practice and procedure provisions to facilitate the just resolution of disputes and the importance of maintaining confidence in the Court’s orders. The Court noted that the applicant had not acted with due diligence in progressing the matters as per the timetabling orders, despite assurances to the contrary. Furthermore, the Court highlighted that varying self-executing orders, which were presented as consent orders, would undermine the integrity of the Court’s processes. The Court concluded that there were compelling reasons to refuse the applicant's request to vary the orders, emphasizing the need for parties to adhere to the Court’s orders and the importance of maintaining the Court’s authority in enforcing those orders.

The Court dismissed the interlocutory application, finding that there were no grounds to vary the Orders of 6 February 2013. It further ordered that the costs of the respondents of and incidental to this interlocutory application should be borne by the applicant's solicitors on an indemnity basis. The Court's decision underscored the importance of strict adherence to Court orders and the consequences of failing to do so, while also reaffirming the Court’s role in ensuring the enforcement of its orders.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

The question for consideration for the Court is whether the Court should exercise its discretion to vary the Orders of 6 February 2013, as sought by the applicant.Background It is useful to set out, in some detail, the background to the current application. The applicant is a company engaged in the business of mineral land administration. It has offices throughout Australia although the largest proportion of its work occurs in Queensland and Western Australia. The applicant’s managing director is Ms Jay Evans-Wheeler, who on 26 February 2013 swore an affidavit in support of the interlocutory application. The first respondent, Ms Hodson, is a former employee of the applicant. The applicant claims that Ms Hodson used the applicant’s confidential information, including client information, rates of charges and precedent documents, to establish the business now operated by the second respondent in competition with the applicant. The applicant further claims that the respondents used the applicant’s equipment to promote the second respondent’s business while Ms Hodson was still employed by the applicant. The applicant filed an originating application in this proceeding on 14 December 2011. In summary, the applicant sought a permanent injunction restraining the respondents from divulging or making use in any way of confidential information of the applicant, in addition to interlocutory restraining orders. By consent on 16 February 2012 I subsequently made interlocutory orders restraining Ms Hodson and the other respondents from, inter alia, performing work in the nature of services supplied by the applicant, or making use of confidential information of the applicant. Subsequently on 4 July 2012, by consent I made the following timetabling orders:1.The parties make any request for further and better particulars by 4.00 pm on 19 July 2012.2.The parties respond to any request for further and better particulars by 4.00 pm on 16 August 2012.3.The applicant file any Amended Statement of Claim by 4.00 pm on 6 September 2012.4. …5. …6.Each party file a notice of discovery identifying the categories of documents sought from an opposing party on or before 4.00 pm on 11 October 2012.7.Each party file a list of documents to be discovered on or before 4.00 pm on 1 November 2012.8.Each party provide inspection of its discovered documents by 4.00 pm on 29 November 2012.9. … The respondents filed a request for further and better particulars on 19 July 2012, and a notice for discovery on 12 October 2012. In his affidavit sworn 22 February 2013, the applicant’s solicitor Mr Conradie deposed that he only became aware on 7 August 2012 that the request for further and better particulars had been filed and emailed to him by the respondents’ solicitor Mr Deighton. In her affidavit sworn 26 February 2013 Ms Evans-Wheeler deposed that Mr Conradie repeatedly assured her that he was progressing the matter. However Mr Conradie conceded in his own affidavit sworn 22 February 2013 that he did not progress the matters the subject of the Orders of 4 July 2012.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Finally, at the hearing the respondents did not dispute that the applicant would be entitled to commence fresh proceedings against them in these circumstances. No serious issue was raised that the applicant was in any way barred from doing so. In my view, this is also a matter relevant to the exercise of the Court’s discretion in this case.Conclusion The interlocutory application should be dismissed. Order 7 of 6 February 2013 directed the applicant to pay the costs of the respondents on a standard basis. In relation to costs specifically incurred in relation to this interlocutory application, the applicant concedes that the appropriate order is that the costs of the respondents of and incidental to this interlocutory application should be borne personally by the solicitors for the applicant on an indemnity basis. I agree that this order is appropriate.

Ratio Decidendi

Legal Principle Established

The Court’s discretion should also be exercised in light of s 37M and s 37N of the Federal Court of Australia Act 1976 (Cth) (the Act), which describe the overarching purpose of the civil practice and procedure provisions as facilitating the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible, and require the parties to act in accordance with that purpose.Consideration The Orders of 6 February 2013 have not been entered. In the circumstances it is not in dispute that the Court has discretion to vary those Orders pursuant to r 39.04 of the Federal Court Rules 2011 (Cth). A self-executing order resulting in dismissal of proceedings is an order of utmost seriousness. In particular, courts have recognised that such orders can be varied in the interests of justice. So, for example, in FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268, the High Court considered the power of courts to extend time for compliance with a self-executing order notwithstanding that the time had passed for compliance, so as to relieve against injustice (Wilson J at 283-284, Brennan, Deane and Dawson JJ agreeing). In this case an order varying the date for compliance with Order 7 by one day would have had no apparent impact on the timetable established by those orders. The solicitor for the applicant has given evidence to the effect that, in agreeing with the Orders of 6 February 2013, he acted without instructions. The dismissal of the proceedings for want of compliance by the applicant with a timetabling order is not a step to be taken lightly. It might also be said that an order in the terms currently sought by the applicant is reflective of the flexibility of the Court to administer its own proceedings. In my view, however, there are compelling reasons why in this case the Court should refuse to make an order in the terms sought by the applicant. First, draft orders – including a self-executing order – were advanced to the Court by the applicant as orders to which both parties agreed. It is clear from the transcript of 6 February 2013 that the solicitor for the applicant was fully cognisant of the seriousness of consequences which could flow from failure to comply with the orders proposed. Ms Evans-Wheeler has given evidence that in fact the applicant was not aware of the agreement of its solicitor to those orders, an issue to which I will shortly turn. However this was not apparent to either the respondent, or the Court. It is also clear, as I note later in this judgment, that the applicant was subsequently informed of the self-executing order and the consequences of non-compliance. In the circumstances, it is scarcely open to the applicant to complain of the consequences of a breach of those orders, or claim injustice when those consequences ensue. Second, as was noted by the High Court in Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175 at [5], [24], [30], [35], it is important that parties to litigation, and the general public, have confidence in orders made by the Court. It is also important that there be confidence in the preparedness of the Court to insist on compliance with those orders when necessary. To vary self-executing orders in these circumstances would constitute a cavalier approach to orders made by the Court, of which all parties were aware, and which were presented as consent orders.