Filipowski v Frey

Australian Securities and Investments Commission v Sweeney (No 2) (2001) 38 ACSR 743; Chappell v Coyle (1985) 2 NSWLR 73; Dicey & Morris, The Conflict of Laws, 13th ed paras 11-112 and 11-350; Eason v 3AW Broadcasting Co Pty Ltd (1985) 81 FLR 229; Filipowski v Frey (2004) NSWLEC 182; Howard v National Bank of New Zealand Ltd [2002] FCA 1257; John Russell & Co Ltd v Cayzer, Irvine & Co Ltd [1916] 2 AC 298; Johnstone v Pedlar (1921) 2 AC 262; CASES CITED: Joye v Sheahan (1996) 62 FCR 417; Laurie v Carroll (1958) 98 CLR 310; Mondial Trading Pty Ltd v Interocean Marine Transport Inc (1985) 65 ALR 155; Parker v Freudenberg [1915] 1 KB 857; Trade Practices Commission v The Gillette Company (No 1) (1993) ATPR 41-267; Trent Cycle Co (Ltd) v Beattie (1899) 15 TLR 176; Watt v Barnett (1878) 3 QBD 183; Wilding v Beam [1891] 1 QB 100

M A Pembroke SC/A L Hill (Prosecutor) Dibbs Barker Gosling (Solicitors) LEGAL REPRESENTATIVES:

Dr A S Bell (Defendant) Ebsworth & Ebsworth (Solicitors)

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

JUDGMENT 1 HIS HONOUR: This is a motion by the Prosecutor seeking the following orders:

1. An order pursuant to Pt 8 r 8 of the Land and Environment Court Rules (Pt 9 r 11 of the Supreme Court Rules) that the documents described in the Schedule be taken to have been served on the defendant on 1 November 2004 or such other date as the Court directs.

2. Alternatively, an order pursuant to Pt 8 r 7 of the Land and Environment Court Rules (Pt 9 r 10 of the Supreme Court Rules) that, instead of personal service on the defendant, the documents described in the schedule be delivered to Mr Simon Liddy, Ebsworth & Ebsworth, Solicitors, 135 King Street, Sydney on or before such date as the Court specifies and that service on the defendant be taken to have been effected thereby.

3. An order, to the extent necessary, dispensing with service of this Notice of Motion on the defendant. 2 The defendant, Frey, does not appear. However, Dr Andrew Bell of counsel appeared to assist the Court. This was not opposed by the Prosecutor, although written submissions addressing matters of standing were filed by the Prosecutor with the Court. It was recognised by the Prosecutor that if, in the absence of any contrary submission, orders for service were made Mr Frey may move to set aside such orders and the questions raised in this motion would need to be resolved. In any event the Prosecutor did not oppose Mr Frey being heard on the current motion (see Trade Practices Commission v The Gillette Company (No 1) (1993) ATPR 41-267 at 41-599 - 41-600). 3 The current motion follows my decision that previous attempts to serve Mr Frey have not been successful (see Filipowski v Frey (2004) NSWLEC 182). In my earlier reasons for decision I made various factual findings which are relevant to the current motion. 4 The offence allegedly occurred on 30 April 2001. The matter was investigated and, on 1 May 2001, the defendant executed an authority and undertaking authorising Mr Liddy, who is a solicitor, to accept service of process and appear on his behalf in any proceedings instituted by the Sydney Ports Corporation. By letter sent on 1 September 2003 the defendant revoked this authority. 5 The evidence discloses that the agent for the Vessel was P&O Nedlloyd Limited and its address was originally 120 Sussex Street, Sydney. When service of documents in other proceedings was attempted at 120 Sussex Street on 30 July 2003, it became apparent that the office had changed to 160 Sussex Street and the documents were served at the new address. A search of the relevant records confirmed the change of address. 6 Apparently Mr Vaughan Williams, who is the solicitor with the day-to-day conduct of these proceedings caused the summons, the order issued pursuant to s 246 of the Criminal Procedure Act and the affidavits relevant to this matter to be filed in the registry of the Court following which, on 29 July 2003, he telephoned Mr Simon Liddy at Ebsworth and Ebsworth. Mr Williams was aware that Mr Liddy had been authorised by Mr Frey to accept service of process and to appear on his behalf in any proceedings which may be instituted by the Sydney Ports Corporation in respect of the alleged pollution incident. 7 Mr Williams was also aware that it was common for Mr Liddy to be authorised to accept service and to appear on behalf of shipowners, Masters and crew members in proceedings. 8 On 29 July 2003 when the telephone call was made Mr Williams was advised that Mr Liddy was not available. He spoke to Mr Craig Carter, who was known to him as a senior associate at the firm, and the following conversation occurred: "Mr Carter said: Simon is not here."

Mr Williams then, speaking slowly to allow Mr Carter to take notes, said the following:

"I am calling Simon to let him know that proceedings have now been issued in relation to the 'P & O Nedlloyd Fos' incident at Brotherson Dock, Port Botany on 30 April 2001. The defendants are the Master, Kleeman and the Chief Engineer Frey and the registered owners of the vessel."

"Would you send us across copies of the pleadings and affidavits."

"I am in the process of having them served on John Southwell-Keely of P&O."

"John Southwell-Keely has gone. The new person is Stuart Hiendrich."

"Thank you. I will arrange for the documents to be delivered to him. You can get copies of the summons and affidavits from P&O. The return date is in six weeks time." 9 On 5 September 2003 Chrisanthe Makris, a solicitor, was asked to serve the documents on Mr Liddy. When she attended upon the office of Ebsworth & Ebsworth for this purpose she was informed that Mr Liddy was not available but was also advised that Mr Frey had revoked the authority which he gave to Mr Liddy. A copy of the letter of revocation was provided to Ms Makris. 10 On 10 September 2003 Mr Liddy was served with the relevant documents at his home. Although he indicated that he was not authorised to accept service, the documents were left with him. 11 The Sydney Ports Corporation was informed of the revocation of the authority to Mr Liddy by a letter from a firm of English solicitors, dated 1 September 2003. A copy of the defendant's letter of revocation, which was not dated, was attached to the solicitor's letter. The letter of revocation refers to a copy of the original authority from which it is possible to establish that it is a copy which was attached to the affidavit of Shane Hobday sworn in these proceedings on 6 March 2003. Accordingly, the revocation must have been made after that date but before 1 September 2003. It is also apparent that the defendant must have had a copy of the authority he had given to Mr Liddy which had been taken from the affidavit. 12 Evidence was also tendered on the motion from Mr Hobday who is the General Manager, Marine Operations of the Sydney Ports Corporation. In that affidavit he indicates that the Sydney Ports Corporation commonly seeks an authority and undertaking from the relevant crew of a ship which has been involved in a pollution incident. This is done in order to avoid holding the ship until proceedings have been instituted and process can be served. He indicates that the consequence of this practice has been that it is widely known by shipowners, foreign masters and crew members that if they are unwilling to provide an authority and undertaking nominating an address for service within the jurisdiction they run the risk that the vessel will be detained. Mr Hobday is concerned that if service cannot be affected in the present case the apparent device to withdraw an authority after a ship has sailed may be utilised to defeat prosecution proceedings in the future. He believes that in the absence of legislative change, the consequence will be that, if substituted service, or confirmation of informal service, is not available in circumstances where there was an extant authority and undertaking nominating an address for service within the jurisdiction at the time of commencement of the proceedings, the day-to-day prosecution operations of the Sydney Ports Corporation are likely to be seriously handicapped. 13 Part 8 r 7 of the Land and Environment Court Rules is the same as Part 9 r 10 of the Supreme Court rules and relates to substituted service. Part 8 r 7 is in the following terms: "(1) If for any reason it is impracticable to effect service of any document on a person in any of the modes prescribed in this Part for that service, the Court may, on application supported by an affidavit showing grounds, by order direct that, instead of service, such steps be taken as are specified in the order for the purpose of bringing the document to the notice of the person. (2) If the Court makes an order under this rule, it may order that service be taken to be effected on the happening of any specified event, or on the expiry of any specified time." 14 Part 8 r 8 of this Court's rules is the same as Part 9 r 11 of the Supreme Court rules. It relates to informal service. Part 8 r 8 is in the following terms: "If it is impracticable for any reason to effect service of any document, but steps have been taken for the purpose of bringing, or having a tendency to bring, the document to the notice of the party, the Court may if it thinks fit by order direct that the service be deemed to have been effected on a date specified in the order." 15 The Prosecutor accepts that the power to make orders pursuant to Pt 8 r 7 or r 8 will only be enlivened if the court had "personal jurisdiction" over the defendant when the proceedings were commenced. The Prosecutor submits that whether or not the court had "personal jurisdiction" depends upon whether the defendant was present or had submitted to the jurisdiction as at 24 July 2003. 16 It is submitted that the defendant, having agreed to submit to the jurisdiction on 1 May 2001, when he gave an authority and undertaking nominating Mr Liddy for the service of process upon him, was relevantly present in New South Wales when the proceedings were later commenced on 24 July 2003, at which time his submission to the jurisdiction was still extant. For the purpose of jurisdiction it is submitted that the critical date is the date of commencement of the proceedings. The Prosecutor accepts that if before 24 July 2003 the defendant had lawfully revoked his authority orders pursuant to Pt 8 could not be made. 17 Because Mr Frey did not purport to revoke his authority until 1 September 2003, by which time notice of the proceedings had been given to Ebsworth & Ebsworth and service had been effected on P&O Nedlloyd, the Prosecutor submits that it should be inferred that he revoked his authority in order to avoid service. 18 The essential element of Dr Bell's submission is that an order for substituted service may only be made when personal service is legally possible, the defendant being within the jurisdiction, but it is impractical, because, perhaps, he cannot be found or for other reasons. Both arguments rely on the discussion of the issues by the High Court in Laurie v Carroll (1958) 98 CLR 310 but take markedly different positions as to the effect of the reasoning of the Court. 19 In Carroll the defendant was resident in England. He had been in Australia but left on the day prior to the issue of a writ. There was evidence that the defendant knew that a writ may soon issue and left the jurisdiction to avoid service. 20 The High Court held that an order for substituted service could not be made and declined to follow two previous English decisions Watt v Barnett (1878) 3 QBD 183; Parker v Freudenberg [1915] 1 KB 857. Critical to the decision was the fact that the defendant had left the jurisdiction before the writ had issued. Because a court only has jurisdiction over a person who can be compelled to submit to a decree (John Russell & Co Ltd v Cayzer, Irvine & Co Ltd [1916] 2 AC 298), this could not extend to a person who was outside the state when the proceedings were commenced. 21 Two problems which were not resolved in Carroll arise in the present case. The first problem is whether by giving authority to Mr Liddy to accept service, which was not withdrawn until after the proceedings were commenced, the defendant was at that time amenable to the jurisdiction of the court. The second problem is whether having withdrawn his authority after the proceedings were commenced, an order for substituted service may be made. Unless both these questions are answered in favour of the prosecution an order for substituted service may not be made. 22 With respect to the first matter I am satisfied that when the proceedings were commenced the defendant was relevantly within the jurisdiction of the court. "Presence" within the jurisdiction may take either of two forms - actual presence or a voluntary submission constituted by a prior nomination of an address for service within the jurisdiction including the authorisation of a person to accept service and appear on the defendant's behalf in proceedings which may be subsequently commenced. In Howard v National Bank of New Zealand Ltd [2002] FCA 1257 at [9] Drummond J outlines the rule: "a consensual agreement providing for service on an agent in the jurisdiction of a respondent who is outside the jurisdiction is treated as a voluntary submission by the respondent to the jurisdiction of the court out of which process is issued." 23 See also Dicey & Morris, The Conflict of Laws, 13th ed paras 11-112 and 11-350; Australian Securities and Investments Commission v Sweeney (No 2) (2001) 38 ACSR 743 at 755 [38]; Mondial Trading Pty Ltd v Interocean Marine Transport Inc (1985) 65 ALR 155. 24 The second problem is more difficult to resolve. In Carroll the High Court decided that substituted service could not be ordered where a person was not in the jurisdiction at the time of the issue of the process even if that person had made arrangements to leave the jurisdiction to avoid service. However, it did not resolve the position of a defendant who was within the jurisdiction when the proceedings commenced but left before being served either to avoid service or otherwise. In the joint reasons for judgment the court acknowledged that there were two views on the matter - the question being "what is conceived to amount to the exercise of the sovereign authority, the issue of the command or the communication of the command" (the different views are identified on p 324). 25 As the full court of the Federal Court point out in Joye v Sheahan (1996) 62 FCR 417, in Carroll the court agreed with the observation of Lord Sumner in Johnstone v Pedlar (1921) 2 AC 262 at 292 that local allegiance owed by an alien is confined to the period when the person is "within the realm." With this observation in mind the full court suggested that more than mere presence within the jurisdiction may be required before a person who has subsequently gone abroad is amenable to an order for substituted service. The additional facts may be knowledge in the person that the writ has issued, or, although not positively knowing of the issue of the writ the person goes abroad to evade service. 26 The trial in Joye was conducted by Branson J who also considered Carroll and the relevant competing views. Influenced by the decisions in Eason v 3AW Broadcasting Co Pty Ltd (1985) 81 FLR 229 and Chappell v Coyle (1985) 2 NSWLR 73 her Honour, taking a different view to that taken by the full court, concluded that the better view was that the court exercises authority over a defendant when the writ issues, that act being not merely an inchoate demand which is perfected when the writ is served. Her Honour also points out that Carroll does not cast doubt on the proposition that where a defendant has left the jurisdiction with knowledge of the issue of a writ in order to evade service substituted service can be ordered: Wilding v Beam [1891] 1 QB 100; Trent Cycle Co (Ltd) v Beattie (1899) 15 TLR 176. 27 In Australian Securities and Investments Commission v Sweeney (No 2) (2001) 38 ACSR 743 Austin J was required to consider whether orders for substituted service could be made where the defendant left Australia the day before a statement of claim was filed and could not subsequently be located. In the course of his detailed reasons Austin J analysed the authorities and relying upon Carroll concluded that "substituted service is permissible as long as the case can be brought within one of the categories set out in Pt 10 r 1A." at [40] In the circumstances his Honour made the relevant orders. 28 In my opinion, the conclusion expressed by Branson J in Joye is not inconsistent with the views of the High Court in Carroll and reflects both a practical and principled resolution of the problem. The practical difficulty with any contrary view is that the occasion for an order for substituted service will commonly arise when the defendant's whereabouts are unknown. It would be an extraordinary requirement if the plaintiff must prove that the defendant remains within the jurisdiction before an order could be made. In many cases the plaintiff will simply not know where the defendant is and it is the lack of knowledge which prompts the making of the application. 29 To my mind, the requirement for the defendant to answer a writ or defend a charge arises when the order of the court requiring his or her attendance is made. Service is merely the means by which the perfected order is communicated to the defendant. 30 In the present case, the prosecutor submits that the defendant, having submitted to the jurisdiction of a New South Wales court by granting authority to Mr Liddy, effectively took steps to withdraw himself from the jurisdiction at a time when he, through his agent, and it may be inferred having himself been told, was aware that proceedings had been commenced. There is no evidence from the defendant on this issue. 31 The relevant sequence of events is clear. Having given authority to Mr Liddy on 1 May 2001 to accept service on his behalf, that authority was only revoked on 1 September 2003. By reason of the annexure note attached to the copy of the authority which was attached by the defendant to his letter of revocation, I am satisfied that he actually knew that these proceedings had been commenced. As I said in my previous reasons there is no evidence that by that time the defendant had received a copy of the summons or the order, but there can be little, if any, doubt that he was aware of the proceedings. Given the lapse of time since the proceedings were commenced and the fact that the withdrawal of the authority occured after Mr Liddy was aware of the proceedings I am satisfied that the motivation for withdrawing the authority given to Mr Liddy was to avoid service of the summons. 32 In my previous decision I considered the application of the relevant rule having regard to the facts which had been proved before me. Those facts have now been significantly augmented by the evidence tendered in these proceedings. That evidence discloses that Mr Frey was the Chief Engineer on board the "P&O Nedlloyd Fos" when the oil spill occurred from the vessel on 30 April 2001. Although the "P&O Nedlloyd Fos" has berthed at Brotherson Dock on four occasions since that date, Mr Frey has not been on board the vessel on any of those occasions and has not travelled to New South Wales since the incident. Further, although Mr Frey is employed by Reederei F Laeisz CmhH C/- Lange Strabe 1A D - 109055 Rostock Germany, he does not work at these premises because his occupation as a Chief Engineer requires him on a day to day basis to work on board various vessels as Chief Engineer. 33 Mr Frey's normal residential address is Hauptstraße 1, in Riesbürg-OT Pflaumloch, Germany. 34 While this is his normal residential address, Mr Frey is very rarely in attendance at that address. Indeed Mr Jaumann, a German lawyer engaged by the Prosecutor attended at the address on 20 August 2004 and 15 October 2004 attempting to serve Mr Frey with the pleadings and notification of the 1 December 2004 hearing date respectively. On both occasions Mr Frey was not in attendance and his wife, Mrs Frey, indicated on the second occasion that in fact he was on board a ship named the M V 'Privilege'. 35 Although the defendant was not at home, the summons, order and affidavits were delivered to his wife on 20 August 2004 at their home. The defendant's wife indicated that the documents would be forwarded to the defendant. 36 On 15 October 2004 Mrs Frey said she had given the documents to Mr Frey. She said 'I sent them to him via his shipping company.' 37 Mrs Frey did not know the intended route of the M V 'Privilege' or precisely where the vessel would be loading/unloading cargo and on what dates. The Prosecutor subsequently contacted Lloyds Registry of Shipping. Lloyds record all ships which trade on a global basis. The Prosecutor ascertained from Lloyds that there were three ships currently using the name 'Privilege'. However, without the vessel's unique International Maritime Organisation number, Lloyds could not further identify which ship Mr Frey was currently serving on. 38 It is normal practice for modern cargo vessels to berth at ports only for periods between four to six hours. Accordingly, it is not practicable, nor indeed possible, without precise details of the ship's itinerary and load/unload ports, to ascertain which ports the ship will be calling at and when. 39 In these circumstances I am satisfied that it would be impracticable to locate the precise vessel upon which Mr Frey is serving and to ascertain at which port it will be calling and when it will do so. Indeed, due to fluctuations in sea conditions, congestion at ports and other matters, it is apparent that ships can and often do not arrive at Port days or even weeks later than expected. 40 The evidence also discloses that copies of the summons, orders and affidavits in the proceedings were served on P&O Nedlloyd, the agent for the ship "P&O Nedlloyd Fos" on 30 July 2003. Although there were some difficulties in the matter, I am also satisfied that Mr Liddy was served with the relevant documents on 10 September 2003. Counsel instructed by Mr Liddy have appeared on both occasions when matters of service have been considered by the court. 41 In these circumstances, I am satisfied that appropriate steps have been taken for the purpose of bringing, or having a tendency to bring the summons and other documents to the defendant's attention. Accordingly, I am satisfied that it is appropriate to make an order pursuant to Pt 8 r 8 of the Land and Environment Court rules. 42 I direct the prosecutor to bring in appropriate short minutes of order which should include directions with respect to the future conduct of the proceedings. **********

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