Ellen G White Estate, Inc v Knudson

EX TEMPORE REASONS FOR JUDGMENT 1 Ellen G White Estate, Inc (the White Estate) has applied ex parte under r 10.43 of the Federal Court Rules 2011 (the Rules) for leave to serve the originating application in these proceedings on Mr Brendan Knudson, the respondent, in the Republic of Armenia where he currently resides. 2 It is pertinent to note three things at the outset: first, throughout these proceedings, Mr Knudson has been self-represented; secondly, since before these proceedings were issued, Mr Knudson has resided in the Republic of Armenia; and thirdly, Mr Knudson has never been served with the originating application in these proceedings. 3 It is also appropriate to record, at the outset, the following background to this application to explain why it has come about. In September 2012, Mr Knudson attempted to file a notice of address for service in these proceedings. In that notice, he supplied an address in the Republic of Armenia. The Registry rejected that notice because it did not provide an address for service in Australia in accordance with the Rules. 4 In October 2012, on the application of the White Estate, orders were made dispensing with service on Mr Knudson and ordering that his address for service was to be an email address that he had used in communications with the solicitors for the White Estate and with the Court. Those orders also required Mr Knudson to file, among other things, a defence in these proceedings. 5 Mr Knudson subsequently filed a defence. However, he later sought to challenge the orders made in October 2012 on the ground that he had at all times been a resident of the Republic of Armenia and, therefore, the October orders were not open to be made. The hearing of Mr Knudsen's challenge to the October 2012 orders occurred (in Mr Knudson's absence) on 26 March 2013. 6 During that hearing, I indicated to Mr O'Brien, for the White Estate, that I considered the decision of the High Court in Laurie v Carroll (1958) 98 CLR 310 precluded an order for substituted service being made in circumstances where the respondent was outside the jurisdiction at the time that the originating process was filed and there was no evidence he or she had left the jurisdiction to avoid service. I also indicated that, at the very least, for an order for substituted service to be made the applicant must have first applied for and received leave to serve the respondent in a foreign jurisdiction, thereby ensuring that an applicant cannot use substituted service to give the Court jurisdiction where it otherwise may not have jurisdiction: see for example Australian Competition & Consumer Commission v Chaste Corp Pty Ltd (in liq) (ACN 089 837 329) [2002] FCA 1183; Australian Competition and Consumer Commission v Kokos International Pty Ltd [2007] FCA 2035 Humane Society International Inc v Kyodo Senpaku Kaisha Ltd [2007] FCA 124; and Applecross Pte Ltd (ARBN 079 372 722) v Lim (No 2) [2010] FCA 589. 7 After some debate, counsel for the White Estate consented to those orders being set aside. This was done on the basis that the White Estate would immediately make the present application. The application was then filed on 26 March and heard ex parte on 27 March 2013. 8 Rule 10.43 relevantly provides: (1) Service of an originating application on a person in a foreign country is effective for the purpose of a proceeding only if: (a) the Court has given leave under subrule (2) before the application is served; or (b) the Court confirms the service under subrule (6); or (c) the person served waives any objection to the service by filing a notice of address for service without also making an application under rule 13.01. Note A respondent may apply to set aside an originating application or service of that application - see rule 13.01. (2) A party may apply to the Court for leave to serve an originating application on a person in a foreign country in accordance with a convention, the Hague Convention or the law of the foreign country. (3) The application under subrule (2) must be accompanied by an affidavit stating: (a) the name of the foreign country where the person to be served is or is likely to be; and (b) the proposed method of service; and (c) that the proposed method of service is permitted by: (i) if a convention applies - the convention; or (ii) if the Hague Convention applies - the Hague Convention; or (iii) in any other case - the law of the foreign country. (4) For subrule (2), the party must satisfy the Court that: (a) the Court has jurisdiction in the proceeding; and (b) the proceeding is of a kind mentioned in rule 10.42; and (c) the party has a prima facie case for all or any of the relief claimed in the proceeding. 9 Subrule (6) (see 10.43(1)(b) above) applies where an originating application has been served in a foreign country without leave. Since Mr Knudson has never been served with the originating application in these proceedings, that subrule obviously cannot apply in this instance. Further, given the background history to this matter set out above (at [3]-[5]), I do not consider that anything Mr Knudson did prior to, or as a result of, the October 2012 orders amounted to a waiver for the purposes of r 10.43(1)(c). That leaves for consideration whether I should grant leave under r 10.43(2) (see r 10.43(1)(a) above). 10 The White Estate has supported its application with an affidavit by Mr Samuel Barber, its solicitor in these proceedings. In that affidavit Mr Barber has deposed that: (a) it is proposed to serve Mr Knudson in the Republic of Armenia; (b) it is proposed that that service be undertaken by personal service on Mr Knudson; and (c) personal service is permitted by Article 5 of the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters done at the Hague on 15 November 1965, defined in r 10.41 as the Hague Convention. I note that both the Republic of Armenia and Australia have ratified and are, therefore, parties to the Hague Convention. 11 I consider that Mr Barber's affidavit satisfies all the requirements of r 10.43(3). 12 On an application under r 10.43, subrule (4) requires the Court to be satisfied about three matters. In satisfying myself on those matters, I consider I should take the same approach as if I were considering an application to strike out the applicant's statement of claim. That is, I should assume that the White Estate will be able to prove the allegations of fact contained in the statement of claim. This, of course, requires me to consider those allegations to determine whether, on their face, they raise valid claims. 13 In summary, the statement of claim in this proceeding alleges that: (a) the applicant is the estate of Mrs Ellen G White, the author of certain original literary works over which copyright is claimed; and (b) between February and April 2012, Mr Knudson, by a series of actions within Australia, infringed the copyright (above described), breaching, among other provisions, ss 116AM-116AN of Part V Division 2A of the Copyright Act 1968 (Cth). That division relates to actions in relation to technological protection measures and electronic rights management information; and (c) from March 2012, by offering reproductions of the works for sale on the internet, Mr Knudson also infringed the copyright and breached the Australian Consumer Law (Competition and Consumer Act 2010 (Cth), Sch 2) by conduct carried out in Australia. 14 As to the first requirement in r 10.43(4) (whether the Court has jurisdiction), it is important to note that the deceased author of the alleged copyright materials was a citizen of the United States of America. As a basic principle, Australian law would not apply to protect copyright held by a foreign citizen. However, in recognition of this, the White Estate relies upon the Copyright (International Protection Regulations) 1969 (Cth), which extends copyright protection in Australia to residents of countries that are parties to the International Convention for the Protection of Literary and Artistic Works concluded at Berne on 9 September 1886 (the Berne Convention). The United States of America became a party to the Berne Convention on 1 March 1989. Noting this and also noting that all of the conduct alleged against Mr Knudson in the statement of claim is said to have occurred within this jurisdiction and involves alleged breaches of Australian law, I am satisfied that this Court has jurisdiction in this proceeding. 15 As to the second requirement in r 10.43(4) (whether the proceedings is of a kind mentioned in r 10.42), r 10.42 provides: Subject to rule 10.43, an originating application, or an application under Part 7 of these Rules, may be served on a person in a foreign country in a proceeding that consists of, or includes, any one or more of the kinds of proceeding mentioned in the following table. 16 The table includes the following proceedings: Item Kind of proceeding in which originating application may be served on a person outside Australia ____________________________________________________________________ 1 Proceeding based on a cause of action arising in Australia … 12 Proceeding based on a contravention of an Act that is committed in Australia 13 Proceeding based on a contravention of an Act (wherever occurring) seeking relief in relation to damage suffered wholly or partly in Australia 14 Proceeding in relation to the construction, effect or enforcement of an Act, regulations or any other instrument having, or purporting to have, effect under an Act 15 Proceeding seeking any relief or remedy under an Act, including the Judiciary Act 1903 … ____________________________________________________________________ 17 I am satisfied that both the alleged copyright infringements and the alleged breaches of the Australian Consumer Law are proceedings of a kind that fall within various of the items set out above, in particular items 12 to 14 inclusive. 18 As to the third requirement in r 10.43(4), first, I note that no other claims are made in the statement of claim apart from those summarised above (at [13]). For the reasons I have already given above, I am satisfied that the White Estate has a prima facie case for all of the relief claimed in the proceedings. 19 For these reasons, I am satisfied that the White Estate has met all the requirements of r 10.43 of the Rules and that it is appropriate to grant it leave to serve the originating application and statement of claim in these proceedings on Mr Knudson in the Republic of Armenia. I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Reeves.