Zohios, H. and R. v Fairfield Chase Pty Ltd

[1990] FCA 87

90

JUDGMENT No. ........ ... fll_./

IN THE FEDERAL COURT OF AUSTRALIA	1	NO	G721 of 1989
NEW SOUTH WALES DISTRICT REGISTRY	1	G722 of 1989
GENERAL DIVISION	1	G746 of 1989
1	G780 of 1989

HARALAMBOS ZOHIOS & REBECCA ZOHIOS &

ORS

Applicants

FAIRFIELD CHASE PTY LIMITED h ORS

Respondents

MOTIONS AND DIRECTIONS (EX TEMPORE)

Short minutes of orders in settlement of the first respondent's motions to strike out several amended statements of claim and by way of a timetable for the preparation of these matters for the earliest possible hearing have been presented. With the qualifications I will mention in a moment, they are said to have the consent or are expected to have the consent of all these other parties named in them. I should say that the consent of those parties who are not present should have been obtained before the timetable was presented.

no alternative timetable. Their attitude is that pending an	Bonnefin and the Richardson respondents do not consent but offer
application for leave to appeal, and if leave is granted the appeal itself, from my judgment today on their security of costs applications, they should not be required to do anything to advance the preparation of these cases for hearing.
Even if ultimately ordered, security for costs will of course not place money in the hands of these respondents or their advisers, and the work will still have to be done to prepare for trial. most of the matters have not been the subject of security applications and they proceed unaffected by these motions. Still nothing is said about the likelihood or otherwise of any security ordered ever being called upon because of the respective parties' chances in the litigation. Yet there was reference to the fact that if security'is not ordered, these respondents might choose in effect to cede the applicants' claims rather than fight the litigation. In this case, this is loose and fanciful talk. Only yesterday these respondents, amongst others, requested that I refer these matters to a Registrar for an attempt at a court-assisted settlement, or consented to my doing so. Thls request or consent was not made subject to questions of security of costs or a possible bail-out by these respondents if security
was not ordered. I cannot Imagine how a compromise settlement would be possible with these respondents if they are
contemplating paying the applicants' claim in full by default.
Security of costs is discretionary and the motions were so decided in this instance. As I mentioned in my judgment on this matter earlier, Bonnefin has been a party to this litigation
since its commencement and the same counsel and solicitor have attended court in her interests on many occasions. The Richardson respondents are of more recent formal vintage but have clearly been ia the wings for some time and their representation is common with Bonnefin.
Bonnefin some time ago agreed to my expediting the hearings of these matters and fixing March 12 and the following several weeks for those hearings, on the basis, commonly advanced by all parties, that the matters were urgent. Until events made it impossible to proceed with that hearlng, there was no application to vacate that hearing in respect of the corporate applicants because these respondents' costs had not been secured. Indeed all the directions hearings were by consent geared to the early hearing. In the same cause I have now devoted a considerable amount of court time to accommodate the parties' interests in these regards, at the expense of other cases and litigants.
Now a further set of hearing dates in June is at risk because one set of respondents wishes to continue the lack of co-operation and balance between the parties which has punctuated this matter
for so long.
There is absolutely no reason why they should not exercise all their rights of appeal as they see fit. There is every reason why the future progress of this entire litigation, including many parties not involved in the 3 motions for security, should not be delayed while they do so. Yet that is the effect of these respondents' attitude on the proposed directions for the preparation of the matters for hearing.
I therefore propose, unless instructed otherwise, to make orders and directions submitted with the actual or apparent consent of everyone else, and to include Bonnefin and the Richardson respondents in these orders and directions.
(Formal orders)
The first respondent Fairfield Chase Pty Limited asks for costs of the motions which have just been otherwise disposed of by consent. The motions originally clalmed orders for the summary dismissal of the applicants' claims on the grounds that the amended statements of claim disclosed no reasonable causes of action, that the proceedings were all frivolous or vexatious, and that they were all abuses of the Court's processes. In the event, what has happened is that a number of paragraphs of the amended statements of claim have been struck out and the applicants will re-plead them.
The joint hearing of these notices of motion was stopped because of and to enable the engrossing in suitable form of these
agreements between the parties; hence I was deprived of the force of learned senlor counsel's much vaunted, confidently promised
and multi-booked argument that where an arguable case on the merits appears in a messy and inadequate pleading, the whole proceedings can be completely dismissed and the moving party totally shut out from presenting a case at all. Nr Hamilton with his customary candour and honour did concede in the argument on costs that he would not have suceeded in establishing no reasonable causes of action, notwithstanding his motions to the contrary. I did note that of the list of authorities handed in by the first -' respondent, the majority were of significantly ancient vintage from a foreign country in the North Sea between the Channel Islands and Ireland.
Lighter matters aside, the general course of these and related proceedings bring little credit on anyone involved. They are numerically multiple, factually complex, legally difficult and by common consent significantly urgent. These are circumstances which, in the interests of the parties and the sensible resolution of the genuine disputes which divide them, call for special efforts and maturity from the legal representatives to co-operate so that the real matters in issue are brought on for hearing as quickly and conveniently as possible. Yet I have had to set aside virtually 5 hearing days this week to deal with questions of demurrer, some far too broadly pitched, on obviously flawed pleadings that ultimately, as they should much earlier, have been resolved between the partles. The costs to the litigants themselves are staggering. Lawyers' work practices are
no less in need of review and modification than anyone else's.
The first respondent says in substance that it has "won". The applicants complain that the normal rule that pleadings to be demurred to should first be discussed between counsel to see if strike out proceedings can be avoided did not occur here. They say that if they had been notified of the intention to attack the amended statements of claim, the agreements now reached would have been concluded without the need for these notices.
AS far as I can see, what the first respondent has "won" is not
its motions but new and correctly pleaded statements of claim to which it can --file defences so that the hearings can proceed. This is a "victory", if it be a victory at all, of extraordinarily minor dimensions compared to the fearsome propaganda of its motions to strike out. This is the type of "victory" normally "won" in one telephone call between counsel, for which little or no charge accrues to any one.
The applicantsf arguments are even more misplaced. These amended statements of claims are their second effort to plead their cases. Significant portions of them are hopeless. They replaced statements of claim to which no objection had been taken. Indeed those applicants involved in related proceedings who filed no amended statements of claim have so far been clear of motions to strike out. The applicants knew, because it was a considerable time ago announced in court, that at least some respondents intended to move to strike out. Yet counsel for the applicants was not briefed in these matters until Monday of thxs week when the motions were fixed for hearing. They knew that they had been
substantially out of time several times previously with the filing of amended statements of claim and the affidavits on which
they intended to rely, and that my patience and humour at these gross infringements of court orders, all or virtually all of which were made by request or consent, were wearing thin. Yet my peremptorily expressed order that the amended statements of clalm be filed by March 5 at the latest was still ignored; although served within time, the filing was four days late, after the day fixed for the filing of motions to strike out.
This itinerary indicates the virtual impossibility of prior consultation by the first respondent on the state of the pleadings. Letters might have been possible, but even this is doubtful. Further, when the first respondent's motions were called on on Tuesday of this week, they were met not with a request for time to consider the matter and negotiate, but with cross motions for the dismissal of the first respondent's motions on the grounds that they were oppressive and actuated by malice or a lack of bona fides. These were serious confrontational allegations supported by affidavits alleging significant impropriety by a solicitor and another person employed by the first respondent. This required an adjournment of the first respondent's motions for 24 hours to permit instructions to be obtained and affidavits in reply to be prepared and sworn.
The fact revealed in those mini-proceedings with such allegedly maxi-consequences were in the end really matters of interpretation and emphasis. There was quite a lot of common ground, except of course that the allegations of oppression and mala fides were strongly denied. In the event, albeit with some
urging from me, the cross motions were withdrawn. The settlement of the first respondent's motions was announced shortly after. I have no doubt that the first respondent's costs thrown away by
the cross motions should be paid by the applicants. As to the costs of the first respondent's motions, I think that they should in all the circumstances be paid as to 50% by the applicants.
16 March 1990 EINFELD J
Later written addition to these orders and directions

.-

Since pronouncing the foregoing orders and directions, I have been favoured with some written submissions from counsel for Bonnefin and the Richardson respondents in response to my invitation that he clarify his clients* precise position in relation thereto. It is now the position that these respondents consent to all the orders and directions in all the cases in the first batch of 5 cases fixed for the two week hearing commencing June 18 except that of the Hair Shack Pty Ltd. Consent is also given to all the orders and directions made in the second category of 8 cases fixed for 2-4 weeks commencing October 8 (Bonnefin and the Richardson respondents are involved in 7 of these cases), except those of Van Hue Aslan Foods Pty Limited and Phu On Trading Pty Limlted.

What this means is that these respondents now do not consent to the batching earlier agreed to. However, there has been and is no application for an adjournment of the first hearing or of the

preparation submitted. The situation is the same in respect of	application of the Hair Shack, nor is any other timetable for its
the 2 cases for the second hearing. It is agreed that the work in preparing the other 9 matters in which these respondents are involved in these two hearings, will considerably overlap with
the preparation of the 3 corporate cases. In my opinion, the costs and inconvenience of separate hearings for the applications of these 3 applicants outweigh other considerations. I therefore do not intend- to vary the orders and directions I gave on 16 March unless and until instructed otherwise.
20 march 1990 EINFELD J

Reasons for Judgment herein of his Honour

Just~ce Elnfeld