Consideration - backdating the joinder order
19 I set out the history of this application in Hillier v Martin (No 14) at [1], [11]-[20], [24]-[36].
20 The applicant's application to join the proposed respondents to the proceedings was filed on 16 May 2022 and served on the first and second respondents as well as the proposed respondents. It was amended by leave granted on 14 June 2022 to add Norman Waterhouse (a Firm) to the proposed respondents.
21 An application to join a party to proceedings is often made ex parte. However, given the application to join the proposed respondents was directed at the first and second respondents' solicitors, it was entirely appropriate to serve the joinder application on the proposed respondents.
22 Had it been the case that the application proceeded ex parte, in principle, it may well have been that the orders joining the proposed respondents to these proceedings could have been made following the filing of the eighth Hillier affidavit on 23 May 2022.
23 The proposed respondents sought the opportunity to make submissions in opposition to any order joining them to the proceedings. The consequence was that although the joinder application was made on 16 May 2022, argument on the application was delayed until 14 June 2022, at which time judgment was reserved.
24 Judgment was further delayed by an ultimately unsuccessful application by a non-party, Thomas Patrick Martin, to re-open argument for the purpose of him making submissions and tendering evidence on the joinder application: Hillier v Martin (No 13) [2022] FCA 939. Judgment in this matter was delivered on 22 August 2022.
25 There is nothing in FCR 9.05 that excludes it from the operation of FCR 1.32 and 1.35. Had it been intended that there be a limit on the operation of the discretion contained in either of those rules, it would have been easy to do so. The reference by the proposed respondents to the observations of Jackson J in Dudley do not assist them.
26 I note that in McAlister v New South Wales and Ors [2014] FCA 702; (2014) 223 FCR 1, Edmonds J considered an application by a non-party to be joined to existing proceedings. His Honour held that the Court did not have power under FCR 9.05 to join a non-party to proceedings on that non-party's application: at [21]. His Honour continued that even if he was of the view that the Court did have power, he was not satisfied that the threshold requirements in FCR 9.05(1)(b)(i) or (iii), which in that case needed to be satisfied in order to engage the power to order a joinder, had been met. In answer to a submission that the general power in FCR 1.32 allowed his Honour to make the joinder order notwithstanding the preconditions in FCR 9.05(1)(b) had not been satisfied, his Honour considered that if there was power under FCR 9.05 for a non-party to be joined as a party on its own application, a general power such as FCR 1.32 should not be exercised in a way that transcends the threshold requirements which FCR 9.05 placed on the exercise of the discretion under the specific power: at [23].
27 The decision in McAlister may be understood in the context of his Honour considering the operation of FCR 1.32 against the non-satisfaction of threshold requirements in FCR 9.05(1)(b)(i)-(iii). The threshold requirements are prescriptive and the exercise of the discretion consequent upon an application pursuant to FCR 9.05(1) is conditioned on satisfaction of those threshold requirements. It is against that background that the general provision in FCR 1.32 which empowers the Court to make any order it "… considers appropriate in the interests of justice" falls to be considered. It is difficult to see why in circumstances where the threshold requirements in FCR 9.05(1) and/or (2) are not met such that the discretion in FCR 9.05 is not enlivened, it is otherwise in the interests of justice to join a non-party to proceedings on that non-party's application. It is that reasoning which seems to have led his Honour to the conclusion he reached.
28 The operation of FCR 1.32, and the power in the Court to make any order it considers appropriate "in the interests of justice", is to be contrasted with the power in FCR 1.35 which allows the Court to make an order that is "… inconsistent with these Rules and in that event the order will prevail". It does not seem that FCR 1.35 was referred to or relied upon in McAlister, although in Lee v Parker (No 2) FCR 1.35 was the subject of Halley J's consideration as to whether the joinder orders his Honour made in that matter should take effect from the date the original proceedings were commenced.
29 It is important to note that as part of the proposed respondents' submissions in opposition to the joinder application in this matter, the proposed respondents had submitted, albeit faintly, the cause of action in conspiracy alleged in the fourth amended statement of claim may be out of time. There was no positive submission by the proposed respondents that that was the case, although the matter was raised. I noted in Hillier v Martin (No 14) at [99] that should that be the case, the respondents and proposed respondents would have the opportunity to plead a limitation defence.
30 It is also important to note that I am informed by the parties that on 28 April 2022 the applicant filed proceedings in the Supreme Court of South Australia alleging, what I am told, are similar allegations against Mr Williams. I was also informed by the applicant that the reason for filing those proceedings on that date was against the possibility, not accepted by the applicant, that the cause of action in conspiracy and the second limb of Barnes v Addy (1874) LR 9 Ch App 244, both of which form part of the fourth amended statement of claim, may be the subject of a time bar which was due to expire on 29 April 2022.
31 In the eighth Hillier affidavit, the applicant deposed to his intention to instruct his solicitors to apply to cross-vest those Supreme Court proceedings to this Court if necessary.
32 The consequence of the applicant seeking an order that the joinder order take effect as from 23 May 2022, is that if in fact there is a potential limitation defence available to the first and second respondents and the proposed respondents as of 29 April 2022, that potential limitation defence is not removed by the joinder order taking effect as from 23 May 2022.
33 During the argument on 20 September 2022, Counsel for the proposed respondents was unable to point to any prejudice that would be suffered by his clients if the joinder order took effect from 23 May 2022. So too, Counsel for the first and second respondents was unable to point to any prejudice.
34 In Lee, Hally J identified five reasons why he was not persuaded to make such an order. Relevant to this matter are the first, third and fifth reasons: Lee [117], [119] and [121]. In summary, those reasons are:
(a) The effect of making such an order would be to permit a plaintiff to overcome a limitation period by joining parties to existing proceedings to advance claims that they may have otherwise been precluded from pursuing if they had commenced new proceedings: [117];
(b) The explanation for the delay in the matter before his Honour was not compelling in the sense that it did not account for the whole of the delay in joining the new parties as plaintiffs: [119]; and
(c) Although there was a substantial overlap in the claims made by the parties who were to be joined to the proceedings as new plaintiffs and the common factual matrix giving rise to the new plaintiff's respective claims, weighed in favour of making a relation-back order, that was outweighed by the prejudice to a respondent in not being able to rely on a potential limitation defence that might have arisen between the time the proceedings commenced on the joinder of the new parties as plaintiffs to the proceedings.
35 There are number of reasons why I consider it is in the interests of justice that the joinder order should take effect from 23 May 2022.
36 First, Brereton J observed in Street & 7, in the passage to which the Full Court referred in Ethicon at [47], the relation-back principle does not apply to an amendment which adds a party so that the relation-back doctrine does not deprive a party joined after expiry of a limitation period of its limitation defence. However, if the joinder order takes effect from 23 May 2022, that will not permit the applicant to overcome a limitation period defence by joining parties to existing proceedings in order to advance claims that he may have otherwise been precluded from pursuing if he had commenced new proceedings. To that extent, the respondents and the proposed respondents suffer no prejudice.
37 Second, had the application not been the subject of argument and the consequent need to reserve the decision, it is likely the joinder order would have been made earlier.
38 Third, although there has been a delay in bringing the joinder application, I dealt with that delay in setting out part of the history of this matter in Martin v Hillier [2022] FCA 351 at [10]-[22] and Hillier v Martin (No 14) at [7]-[10]. I accept that the delay in bringing the joinder application has been explained by the applicant and that in this case, the delay is not a reason either to refuse to make the joinder order or to refuse to make an order that it take effect on 23 May 2022.
39 Fourth, there is a common factual matrix applicable to at least the first respondent, as well as the proposed respondents. However, unlike the position in Lee: at [121], there is no suggestion that by ordering the joinder order to take effect from 23 May 2022, that will remove the ability of the respondents and the proposed respondents to plead limitation defences, if so advised.
40 Finally, the applicant also seeks an order granting leave to file a further amended originating application to reflect the additional parties and the new cause of action and relief the applicant claims in the fourth amended statement of claim. The order granting leave to file a further amended originating application will take effect from 23 May 2022. For the avoidance of any doubt, it is the additional relief claimed in the further amended originating application reflecting the new causes of action now sought in the fourth amended statement of claim that will take effect from 23 May 2022.
41 It is for these reasons that in the exercise of my discretion, I dispensed with FCR 9.05(3) and ordered that in the interests of justice, the joinder of the proposed respondents is to take effect from 23 May 2022.