Discussion
22 Rule 9.05 of the Federal Court Rules 2011 (Cth) ("the 2011 Rules") states:
9.05 Joinder of parties by Court order
(1) A party may apply to the Court for an order that a person be joined as a party to the proceeding if the person:
(a) ought to have been joined as a party to the proceeding; or
(b) is a person:
(i) whose cooperation might be required to enforce a judgment; or
(ii) whose joinder is necessary to ensure that each issue in dispute in the proceeding is able to be heard and finally determined; or
(iii) who should be joined as a party in order to enable determination of a related dispute and, as a result, avoid multiplicity of proceedings.
(2) A person must not be added as an applicant without the person's consent.
(3) If a person is joined as a party under this rule, the start date of the proceeding for the person is the date on which the order is made.
(4) An application under subrule (1) need not be served on any person who was not served with a copy of the originating application.
Note The Court may make an order for any of the following:
(a) service of the order and any other document in the proceeding;
(b) amendment of a document in the proceeding;
(c) the filing of a notice of address for service by a party.
23 It was frequently stated that an applicant for joinder under the previous equivalent to r 9.05 of the 2011 Rules (O 6 r 8 of the Federal Court Rules (1979) (Cth) ("the 1979 Rules")), must show an arguable case against the parties proposed for joinder, at least to the standard of being able to resist an application for summary judgment if the relevant persons had been sued in separate proceedings (see Review Australia Pty Ltd v Redberry Enterprise Pty Ltd (2003) 58 IPR 366 ("Review Australia") at [5] and Tytel Pty Ltd v Australian Telecommunications Commission (1988) 11 IPR 223 at 225, applying the principles in General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1965] ALR 636).
24 In Comcare, on which iSelect relied, Jessup J permitted joinder under O 6 r 8(1)(b) of the 1979 Rules despite opposition on grounds including that the making of alternative allegations against the proposed respondent would involve inconsistency.
25 His Honour referred, inter alia, to Warner Music Australia Ltd v Swiftel Communications Pty Ltd (2005) 67 IPR 27, in which Branson J refused joinder where the only common element in the allegations between the existing and proposed respondents was that the claims against the latter could be conveniently dealt with at the same time as the former, and could not be shown to be manifestly groundless.
26 In that context, Jessup J stated at [13]:
I agree, with respect, that O 6 r 8(1)(b) is not brought into operation merely by the circumstance that a cause of action may be legitimately prosecuted against the proposed respondent in the existing proceeding. I also agree that it will not be sufficient for an applicant seeking joinder merely to show that he or she has claims against the proposed respondent which could not be dismissed as unarguable in the General Steel sense. However, … neither do I accept that O 6 r 8 is concerned only with existing proceedings which are "improperly constituted by reason of the failure to join a person as a party". I consider that such a view takes too narrow an approach to the concept of ensuring that all matters in dispute in the proceeding are effectually and completely determined and adjudicated upon. It is sufficient for present purposes to say that I consider that the expression "all matters in dispute in the proceeding" extends at least to matters which are placed in dispute by an existing party and which, if determined in a particular way, would result in a finding that another person, rather than the existing party, should be called to account for the transgression presently alleged by the applicant.
27 In Brisbane Slipways, the plaintiff sought to maintain the jurisdictional competency of its action in rem under the Admiralty Act 1988 (Cth) in relation to a general maritime claim for payment for work it had performed on a ship. The existing defendants were the individual who allegedly signed the documents commissioning the work, the ship and the corporation asserting ownership of the ship.
28 Greenwood J, refused the plaintiff leave to join, as a fourth defendant, a company of which the individual defendant was a director, and whose street address he had used, on the basis that the individual defendant might argue that he was acting on the company's behalf.
29 The individual defendant deposed that he was not employed by, or agent of, the company. Greenwood J noted that the proposed joinder was simply to meet an apprehended defence. The applicant did not contend that it had an arguable cause of action against the company. The company was thus not a necessary party to ensure that all matters in dispute in the proceeding could be effectually determined.
30 Greenwood J referred to Comcare and stated at [152]-[154]:
Jessup J took the view that it would not be sufficient for an applicant seeking joinder to merely show that he or she satisfies the General Steel test. That test would at least require the applicant to show that it has a case against Arc en Ciel Voyages which is not so obviously untenable that it cannot possibly succeed; is not manifestly groundless; is not so manifestly faulty that it does not admit of argument. Other such considerations under the General Steel tests are whether the case upon which the applicant relies is a case which the court is satisfied cannot succeed; whether the claim is based on a cause of action which under no possibility could be good; and whether the case advanced on the current state of the pleadings would be manifestly useless.
With respect, I agree with Jessup J's observation that it is not sufficient to simply demonstrate satisfaction of the kind of tests discussed in General Steel as those tests are no substitute for the language of the rule. The applicant seeking joinder must demonstrate that it seeks to place in dispute the factual question whether Mr Pantaloni was acting in a particular capacity or purporting to exercise authority howsoever arising on behalf of another person rather than simply on his own behalf and that Arc en Ciel Voyages should be called to account in the proceeding in respect of the conduct put in controversy so as to ensure that all matters then in dispute within the proceeding are completely determined and finally adjudicated upon.
The plaintiff does not assert any cause of action against Arc en Ciel Voyages let alone a cause of action which might satisfy the tests reflected in General Steel. The application for joinder is simply a defensive application on the assumption that Mr Pantaloni may 1 day seek to say that he has no liability on the contract because he was acting for and on behalf of Arc en Ciel Voyages. In short, no affirmative case is made against that corporation at all. If Mr Pantaloni suddenly changed position on that point, inferences might arise against him based upon a late change in position and to the extent that such a change resulted in a conclusion that Arc en Ciel Voyages should then be joined as a party, cost consequences would almost certainly arise. If an affirmative case is to be made, it ought to be formulated and the foundation material facts identified and properly advanced in support of a joinder application.
31 While on one view, the observations in Comcare and Brisbane Slipways may support a higher threshold for joinder than hitherto applied, when read in context, those in Comcare were not directed at the question of the strength of the case, but whether joinder met other requirements of the relevant rule. Brisbane Slipways involved a merely apprehended defence, which the opponent had effectively disavowed.
32 It was unnecessary to determine whether, and if so in what sense, a more stringent test for joinder now applied, as I considered that, on any view, the allegations in the proposed amendment raised "an affirmative case", seeking to place in dispute the factual question whether Mr McCann had the requisite knowledge of, and authorised, the relevant advertisements. There was thus a sufficient case against Mr McCann for the purposes of joinder. While particulars of some allegations were scant, the role and authority Mr McCann exercised in his positions and his participation in the meeting appeared to be peculiarly within the knowledge of iSelect and/or Mr McCann. They were thus difficult to particularise prior to discovery and necessarily depended on inference to a considerable extent.
33 In Review Australia, Heerey J refused applications to join, as joint tortfeasors, a number of directors of corporate respondents, who allegedly infringed, and/or authorised the infringement of, copyright.
34 While his Honour observed that the position as a director was itself insufficient to support an arguable case of joint tortfeasance, the persons resisting joinder deposed to their roles in the respondent companies, and there was thus positive and credible evidence to explain how the infringements could have occurred without their knowledge.
35 In the present case, as Mr McCann's role in the relevant positions was, at this stage, within the knowledge of the iSelect parties, the want of particulars was not a basis to refuse joinder.