Cvetkovic & Anor v Parexel International P/L & Anor

CATCHWORDS : Review decision of Registrar - whether a defendant should be joined or removed Supreme Court Act - s 63 LEGISLATION CITED : Supreme Court Rules - Part 8 Trade Practices Act 1974 (Cth) - s 82 Abram v National Australia Bank Limited [2001] NSWSC 916 Beaufort Air-Sea Equipment Pty Ltd v Emhart Australia Pty Ltd (NSWSC unreported, Master Malpass, 18 December 1992) CASES CITED : Brijeski v Sunbeam Corporation Limited (NSWSC, unreported Master Greenwood, 29 January 1997) Mariala Estates Limited v Athanasi & Ors [2001] NSWSC 1013 Modern Woodcraft Pty Ltd v Nott (NSWSC unreported, Young J, 7 March 1997) Westpac Banking Corporation v Abemond Pty Ltd, Westpac Banking Corporation v Cameron (NSWSC unreported, Santow J, 3 November 1994) Dragan Cvetkovic (First Plaintiff)

Sladjana Cvetkovic (Second Plaintiff) PARTIES : Parexel International Pty Ltd (First Defendant)

Omnicare Climnical Research Pty Ltd (Second Defendant) FILE NUMBER(S) : SC 20144/2003 COUNSEL : Mr N Manousaridis (First Defendant) Mr D Cvetkovic in person (Plaintiffs)

SOLICITORS : Mr M Nightingale of Baker McKenzie (First Defendant)

Ms Lee of Middletons (Second Defendant)

LOWER COURT Supreme Court JURISDICTION : LOWER COURT N/A FILE NUMBER(S) : LOWER COURT Assistant Registrar Howe JUDICIAL OFFICER :

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

20144/2003 - DRAGAN CVETKOVIC & ANOR v PAREXEL INTERNATIONAL PTY LTD & ANOR

JUDGMENT (Review decision of Registrar - whether a defendant should be joined or removed) 1 MASTER: By notice of motion filed 28 November 2003, the plaintiffs seek firstly, an order pursuant to Part 61 rule 3 of the Supreme Court Rules (SCR) that the orders made on 3 November 2003 by Assistant Registrar Howe be dismissed and the following order be made: (a) pursuant to the Part 8 rules 2(a), 4 and 8 of the SCR and s 63 of the Supreme Court Act 1970 (SCA) leave be granted to join Parexel International Pty Ltd (Parexel) as a defendant in these proceedings, or (b) in the alternative, leave be granted to join Parexel as a defendant in these proceedings pursuant to Part 8 rules 2(b), 4 and 8 of the SCR and s 63 of the SCA. In the alternative, pursuant to Part 61 rule 3 of the SCR, an order by way of variation of the orders of Assistant Registrar Howe whereby Parexel would remain joined but excused from attendance at part of the proceedings, or otherwise as the court thinks fit. Secondly, an order granting leave to the plaintiffs to amended their statement of claim pursuant to Part 8 rule 3 and Part 20 rule 1 of the SCR; and thirdly, no order as to costs or in the alternative, costs be reserved in relation to this and the two previous applications. 2 The first plaintiff is Dragan Cvetkovic. The second plaintiff is Sladjana Cvetkovic. The first defendant is Parexel International Pty Ltd. The second plaintiff is Omnicare Clinical Research Pty Ltd. As was the case before the Registrar, the plaintiffs were not legally represented. At the hearing, the first plaintiff spoke on behalf of both plaintiffs although the second plaintiff was present in court, answered questions and occupied a seat at the bar table. The second defendant neither consents nor opposes the application. 3 The plaintiffs are married and are qualified medical doctors. The first plaintiff sues for damages for injury occasioned by the terms, and the termination, of his employment by Parexel from 1 June 1998 to 12 June 1998. He also sues Omnicare concerning his employment by that defendant from 24 November 1998 to 2 August 1999. The second plaintiff sues for nervous shock and damages pursuant to s 82 of the Trade Practices Act 1974 (Cth) (TPA) concerning her husband's dealings with Parexel and for damages concerning issues arising during her employment by Omnicare from 29 April 1998 to 17 September 1999. Both plaintiffs allege that both employers utilised the same pattern of misleading and deceptive conduct to recklessly misuse their vulnerability as skilled immigrants for their own benefit and destroyed their prospects for professional and personal settlement in this society. I shall refer to the pleading in the statement of claim in more detail later in this judgment. 4 On 3 November 2003, the Registrar refused the joinder of Parexel International Pty Limited and ordered the plaintiffs to pay the defendant's costs.

Review 5 Cases that are authority on the consideration that ought to be given in a review include: Beaufort Air-Sea Equipment Pty Ltd v Emhart Australia Pty Ltd (NSWSC unreported, Master Malpass, 18 December 1992); Brijeski v Sunbeam Corporation Limited (NSWSC, unreported Master Greenwood, 29 January 1997); Westpac Banking Corporation v Abemond Pty Ltd, Westpac Banking Corporation v Cameron (NSWSC unreported, Santow J, 3 November 1994); Modern Woodcraft Pty Ltd v Nott (NSWSC unreported, Young J, 7 March 1997); Mariala Estates Limited v Athanasi & Ors [2001] NSWSC 1013; and Abram v National Australia Bank Limited [2001] NSWSC 916. 6 From these decisions, the approach to be taken is that one should inform themselves of the Registrar's decision and all the material before the Registrar at the time when they made the decision. No new evidence is relied upon and an independent decision should be made based on the material before the reviewer after having had the benefit of the parties' submissions. The evidence before the Registrar consisted of two affidavits sworn by both plaintiffs on 14 August and 20 October 2003, and an affidavit of Michael Luke Nightingale, sworn 17 October 2003.

The pleading 7 The first defendant has helpfully outlined the claims against Parexel and Omnicare as pleaded in the Statement of Claim They are that during the course of a number of meetings in April, May and June 1998, Parexel made a number of alleged misrepresentations concerning the amount of salary the first plaintiff would be paid as an employee of Parexel, and the functions the first plaintiff would be performing. On the faith of those representations, the first defendant accepted employment with Parexel until 12 June 1998. The first plaintiff pleads that he suffered the following loss and damage as a result of Parexel's alleged conduct, namely: 'loss of trust and confidence necessary for the employment; loss of employment; loss of opportunity to undertake PhD studies; mental distress and humiliation that endured for months and damage to professional reputation. The second plaintiff does not plead any cause of action against Parexel. She alleges that the conduct which the first plaintiff complains of also caused her damage but as previously stated makes a claim under the TPA. 8 The first plaintiff's claim against Omnicare is that during the time he was employed by Omnicare (11 November 1998 to 14 December 1998) Omnicare engaged in conduct that was wrongful and as a consequence of that wrongful conduct, he suffered the following loss and damages, namely, loss of trust and confidence; loss of employment; reinstatement of the mental distress and humiliation caused by Parexel; further damage to the plaintiffs' professional reputation and credibility; inability to secure employment with another employer; and damage to financial credibility. 9 The second plaintiff's claim against Omnicare is that during the period January 1999 to July 1999, Omnicare engaged in wrongful conduct in relation to the terms on which the second plaintiff would remain employed by it, and as a consequence, she suffered loss and damage. This included, loss of trust and confidence; loss of employment; mental distress and humiliation; damage to the second plaintiff's professional reputation and credibility and damage to settlement in the community.

The Registrar's decision 10 Before the Registrar, Parexel sought an order pursuant to Part 8, rule 6 of the SCR which deals with inconvenient joinder and allows the court to order separate trials or make such other order as the court thinks fit. Pursuant to Part 8, rule 2 of the SCR the plaintiffs sought leave to join Parexel. 11 Part 8 rule 2 of the SCR reads: "Two or more persons may be joined as plaintiffs or defendants in any proceedings: (a) where: (i) if separate proceedings were brought by or against each of them, as the case may be, some common question of law or of fact would arise in all the proceedings, and (ii) all rights to relief claimed in the proceedings (whether they are joint, several or alternative) are in respect of or arise out of the same transaction or series of transactions, or (b) where the Court gives leave so to do." 12 The Registrar stated: "7 From this it can be seen that joinder is authorised if there is some common question of law (or fact) AND the relief claimed is in respect of the same transaction (or series of transactions). Two threshold questions have to be met before proceedings against two defendants may be commenced.

8 The interpretation of the phrase 'in respect of or arise out of the same transaction or series of transactions' became the focus of the hearing. The two cases tendered by Parexel were instructive. 9 In Dean-Willcocks and anor. -v- Air Transit International Pty Limited and ors (2002) 55 NSWLR 64, Justice Austin considered the implications of Part 8, rule 2, where a liquidator sought leave to join several defendants alleged to have had unfair preference dealings. It was held that, although each transaction involved an unfair preference, this was not enough to make them the same series of transactions. At page 71 Justice Austin found that the liquidator's right to relief against a defendant in respect of a particular preferential transaction arose only out of that transaction and not out of the events giving rise to the insolvency.

10 The High Court of Australia has also examined the issue. In Payne and ors. -v- Young and ors (1980) 145 CLR 609 it was unanimously held that the proceedings were improperly brought. Both Barwick CJ and Mason J found that the word 'series' was governed by the implied words 'the same'. Mason J at page 618 clearly defined the position as: 'The consequence is that under … the rule joinder of separate causes of action accruing to different plaintiffs is authorised when the relief claimed is in respect of, or arises out of, the same or a particular series of transactions. Joinder is not authorized when the relief claimed is in respect of, or arises out of, two or more different series of transactions, when the participation of each individual plaintiff is limited to participation in one series of transactions, the other plaintiffs not participating in that series.' and the specific issue was referred to by Barwick CJ, at page 615, citing the words of the Judge appealed from: 'The most that can be said here is that the claims arise out of similar transactions or several series of similar transactions.'

The claims of each plaintiff are set out above. True it is that each has a claim against each of the two defendants and the relief claimed appears similar in that both arise from employment. But there the commonality of the litigation ceases. Each had a separate contract of employment with Omnicare. There were different periods of employment of each plaintiff. The husband had a contract of employment with Parexel, but the wife did not. It cannot be said that the employment of the husband by Parexel and then by Omnicare is either the same transaction or the same series of transactions involving his wife. There were two separate periods of employment by two employers. Similarly, it cannot be said that the wife's claims against Parexel and against Omnicare were either the same transaction or the same series of transactions involving her husband. The facts concerning both defendants' dealings with each plaintiff will differ. Therefore, the plaintiffs have failed to establish that the two threshold questions posed by Part 8, rule 2 have been achieved simultaneously." 13 While I agree with the reasoning so far as it relates to Part 8 rule 2 of the SCR, it is not the end of whether Parexel International Pty Limited should remain joined a defendant in these proceedings. 14 Part 8 rule 8 of the SCR provides: "8 Addition of parties

(1) Where a person who is not a party: (a) ought to have been joined as a party, or

(b) is a person whose joinder as a party is necessary to ensure that all matters in dispute in the proceedings may be effectually and completely determined and adjudicated upon,

the Court, on application by him or by any party or of its own motion, may order that he be added as a party and make orders for the further conduct of the proceedings.

…" 15 Parexel submitted that the plaintiffs' application should not be granted because the plaintiffs have not demonstrated any commonality of issue of fact or law between the claims against it and Omnicare. Parexel further submitted that if there is any commonality of fact in the plaintiffs' claims, they have not demonstrated there will be any resulting advantages in saved time and cost if their claims against Parexel and Omnicare are joined in the one proceedings or, if they have so demonstrated, that such savings will outweigh the disadvantages that Parexel will suffer if such joinder is allowed. 16 The plaintiffs submitted that employment was both a central and an essential transaction in their migration pathway and consequently employment cannot be seen as anything else but the "same series of transactions". However, there are three separate contracts of employment. In relation to the Parexel employment Mrs Cvetkovic was not a party to that contract but is claiming damages. I accept that while the facts and circumstances surrounding each contract will differ, some of the contractual provisions will be similar. However, more important is the overlapping issue of damage suffered, which includes alleged mental distress, humiliation and damage to their professional reputations. If the claims were heard at the one trial, the court would be in a better position to assess damages particularly in relation to the psychological symptoms. It would in my view be a more expeditious use of court time to hear all these issues at the one time. 17 True it is that the plaintiffs may plead a further separate statement of claim against Parexel. In that case, both the Omnicare and Parexel cases may be ordered to be heard together, but I see no utility in this course of action. It is my view that it is necessary to join Parexel as a party to these proceedings to ensure that all matters in dispute in the proceedings can be effectually and completely determined and adjudicated upon. 18 The importance of Part 8 rule 8 of the SCR was not brought to the attention of the Registrar although the overlap of issues, particularly damage was referred to in the affidavit of the plaintiffs. Part 8 rule 8 of the SCR was ventilated more fully before me. 19 The appeal is upheld. I set aside the order of Assistant Registrar Howe dated 3 November 2003. I order that Parexel International Pty Limited remain as first defendant in these proceedings. As Part 8 rule 8 of the SCR was not properly argued at the hearing before the registrar, the costs order made by the registrar should not be interfered with and should remain. On the application before me, I order that the first defendant pay the plaintiffs' costs.

(2) I set aside the order of Assistant Registrar Howe in so far as joinder of Parexel as a defendant was refused and order that Parexel International Pty Limited remain as first defendant in these proceedings.

(3) The costs order made by the registrar is not set aside.

(4) On the review application before me, I order that the first defendant pay the plaintiffs' costs. **********

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