FEDERAL COURT OF AUSTRALIA
Watson v Kriticos (Summary Judgment) [2021] FCA 261
File number: NSD 970 of 2019 Judgment of: PERRAM J Date of judgment: 24 March 2021 Catchwords: PRACTICE AND PROCEDURE – application for summary judgment and strike out – application for further particulars Legislation: Competition and Consumer Act 2010 (Cth) Sch 2 s 4
Federal Court of Australia Act 1976 (Cth) s 31A(2)
Federal Court Rules 2011 (Cth) rr 10.43(2), 16.02(1)(d), 16.03, 16.21(1), 26.01(a)
Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters. Opened for signature 15 November 1965. 658 UNTS 163 (entered into force 10 February 1969)
Cases cited: Alati v Kruger (1955) 94 CLR 216
Allstate Life Insurance Co v Australia and New Zealand Banking Group Limited [1994] FCA 636; 217 ALR 226
Associated Alloys Pty Limited v ACN 001 452 106 Pty Ltd [2000] HCA 25; 202 CLR 588
Berry v CCL Secure Pty Ltd [2020] HCA 27; 94 ALJR 715
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266
Codelfa Construction Pty Ltd v State Rail Authority of NSW [1982] HCA 24; 149 CLR 337
Ho v Akai Pty Limted (in liquidation) [2006] FCAFC 159; 247 FCR 205
Polar Aviation v Civil Aviation Authority [2012] FCAFC 97; 203 FCR 325
Spencer v Commonwealth [2010] HCA 28; 241 CLR 118
Watson v Kriticos (Joinder and Service Applications) [2020] FCA 1019
Division: General Division Registry: New South Wales National Practice Area: Intellectual Property Sub-area: Patents and associated Statutes Number of paragraphs: 71 Date of hearing: 2 September 2020 Counsel for the Applicant: Mr G Campbell Solicitor for the Applicant: Heathfield Grosvenor Lawyers Pty Ltd Counsel for the First Respondent: Mr D J Ananian-Cooper Solicitor for the First Respondent: Plastiras Lawyers Counsel for the Second Respondent: The Second Respondent did not appear ORDERS
NSD 970 of 2019 BETWEEN: DALE CAMERON WATSON
Applicant
AND: STEPHEN CON KRITICOS
Respondent
WHITEWATER WEST INDUSTRIES LTD
Second Respondent
ORDER MADE BY:
PERRAM J
DATE OF ORDER:
24 MARCH 2021
THE COURT ORDERS THAT:
1.Paragraphs 1, 2, 3, 4, 5, 6, 8 and 9 of the interlocutory application dated 7 July 2020 be dismissed.
2.Paragraphs 31, 32, 65, 86, 94, 101, 110, 125, 141, 151, 175, 176, 194, 199 and 206 of the Second Further Amended Statement of Claim filed 26 June 2020 be struck out.
3.Leave be granted to the Applicant to re-plead the paragraphs referred to in order 2 by filing and serving a Third Amended Statement of Claim within 28 days of the date of these orders.
4.Leave be granted to the Applicant, pursuant to r 10.43(2) of the Federal Court Rules 2011 (Cth), to serve the Further Amended Originating Application filed 6 December 2019, the Second Further Amended Statement of Claim filed 26 June 2020 and a copy of these orders on the Second Respondent, in Canada, in accordance with the Convention on the Service…
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- AGLC
- Watson v Kriticos (Summary Judgment) [2021] FCA 261
- Case
- [2021] FCA 261
- Decision Date
CaseChat Overview and Summary
The court considered the principles governing summary judgment and the striking out of pleadings. The defendant argued that the plaintiff could not demonstrate that the defendant had agreed to give him a 12.5% share in the patents. Given that the plaintiff's evidence was based on a telephone conversation and the defendant did not contradict this evidence, the court found it problematic for the plaintiff to succeed in his claim. Furthermore, the court found that the plaintiff's pleadings failed to disclose a reasonable cause of action concerning the loss and damage that would have occurred if the defendant had not breached the alleged agreement and fiduciary duty. The court held that the plaintiff needed to re-plead these aspects.
The court dismissed the defendant's application for summary judgment but granted the application to strike out certain paragraphs of the plaintiff's statement of claim. The court allowed the plaintiff to re-plead these parts within 28 days. The court also granted the plaintiff leave to serve the relevant documents on the second defendant in Canada, in accordance with the Hague Service Convention. The court ordered that the defendant pay the plaintiff's costs of the interlocutory application.
Orders
Orders of the court
1. Paragraphs 1, 2, 3, 4, 5, 6, 8 and 9 of the interlocutory application dated 7 July 2020 be dismissed.
2. Paragraphs 31, 32, 65, 86, 94, 101, 110, 125, 141, 151, 175, 176, 194, 199 and 206 of the Second Further Amended Statement of Claim filed 26 June 2020 be struck out.
3. Leave be granted to the Applicant to re-plead the paragraphs referred to in order 2 by filing and serving a Third Amended Statement of Claim within 28 days of the date of these orders.
4. Leave be granted to the Applicant, pursuant to r 10.43(2) of the Federal Court Rules 2011 (Cth), to serve the Further Amended Originating Application filed 6 December 2019, the Second Further Amended Statement of Claim filed 26 June 2020 and a copy of these orders on the Second Respondent, in Canada, in accordance with the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters. Opened for signature 15 November 1965. 658 UNTS 163 (entered into force 10 February 1969).
5. If service in accordance with order 4 is not effected before the filing of any Third Amended Statement of Claim filed in accordance with order 3, the Applicant be granted leave to approach the Court in Chambers in relation to leave to serve the Third Amended Statement of Claim on the Second Respondent.
6. The First Respondent pay the Applicant’s costs of the interlocutory application dated 7 July 2020 as taxed, agreed or assessed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
I accept, however, the First Respondent’s submissions about proposition (f). The Applicant will need to plead what he says would have happened if the First Respondent had not breached the alleged terms of the 2013 Agreement and the alleged fiduciary duty. The pleading of loss and damage will be struck out with leave to re-plead.CONSIDERATIONPrinciples The First Respondent applies for summary judgment under r 26.01(a) of the Federal Court Rules 2011 (Cth) (‘FCR’) which the Court may grant if satisfied that the Applicant has no reasonable prospects of successfully prosecuting the relevant part of the proceeding. The First Respondent does not apply under s 31A(2) of the Federal Court of Australia Act 1976 (Cth) (‘the FCA Act’). One cannot be definitive about these matters but FCR r 26.01(a) will often apply to a situation where there is unanswerable or unanswered evidence of a fact which is fatal to the pleaded case: cf Spencer v Commonwealth [2010] HCA 28; 241 CLR 118 at 130-131 [22] per French CJ and Gummow J. The First Respondent’s submissions are directed to a contention of that kind. As will be seen he submits that because of the state of the evidence the Applicant cannot succeed in demonstrating that the First Respondent agreed to give him a 12.5% share in the patents. Given the fact that (a) the Applicant’s evidence is that the First Respondent agreed to this in a telephone conversation and (b) the First Respondent does not contradict that evidence on the present application, there are obvious problems with the application. In relation to his application to strike out various parts of the 2FASOC, the First Respondent relies upon FCR r 16.21(1) which permits a pleading to be struck out on certain grounds. The First Respondent does not identify the ground upon which he relies but I take it to be the ground in FCR r 16.21(1)(e) which is available where the pleading ‘fails to disclose a reasonable cause of action’. A reasonable cause of action means one with some chance of success if regard be had only to the allegations in the pleading relied upon by the claimant: Polar Aviation v Civil Aviation Authority [2012] FCAFC 97; 203 FCR 325 at [41]-[43] per Perram, Dodds-Streeton and Griffiths JJ; Wride v Schulze [2004] FCAFC 216 at [25] per Spender, Tamberlin and Bennett JJ; Allstate Life Insurance Co v Australia and New Zealand Banking Group Limited [1994] FCA 636; 217 ALR 226 at 236 per Beaumont J.The 12.5% ownership term The Applicant, who is a patent attorney, alleges at 2FASOC §23 that on 21 June 2013 he reached an agreement with the First Respondent, a client, concerning the disposition of the patents and patent applications in relation to the Surf Machine Invention. The agreement is also alleged to extend to other inventions and to the Surf Machine Invention itself. However, those broader allegations may be put to one side since it was not suggested that the other patents and patent applications would be dealt with on any different basis to those applying in the case of the Surf Machine Invention. Attention may therefore be confined to the allegation concerning the existence of the term that the First Respondent agreed to give the Applicant a 12.5% ownership interest in the patents and patent applications relating to the Surf Machine Invention.