Jensen Laundry Systems Australia Pty Ltd v Raskopoulos

Proposed appeal against orders of 6 and 8 May 2015

Our reasons for rejecting the application for leave to appeal from those orders are as follows. The orders were interlocutory and with respect to a matter of practice and procedure. They involved no novel question of general importance. The arguments resulting in the orders occupied parts of the hearings on 5, 6 and 8 May 2015. No reasons were given, or subsequently sought, for the making of the orders. The submissions in support of the application for leave to appeal proceeded on the basis that those reasons are to be found in the exchanges between the Court and counsel. Reference to those exchanges does not reveal any obvious error in the exercise of the primary judge's discretion. (This conclusion is expanded upon below.) Finally, there is no apparent utility in allowing the proposed appeal to proceed. It is conceded that, even if they are successful in this Court, the applicants cannot be restored to the position they would have been in had the primary judge refused the joinder and adjournment applications, and proceeded with the final hearing. Recognising this difficulty, the applicants suggested in their application to this Court that if leave were granted and the appeal allowed, it would be appropriate to set aside the orders made by the primary judge and "enter a verdict and judgment in favour of the applicants against the respondent, with costs". The fundamental difficulty with this submission is that the applicants made no such application for default or summary judgment to the primary judge as part of or in relation to the applications which are the subject of the proposed appeal.
Several matters were relied upon as revealing error in the exercise of the primary judge's discretion. First, it was submitted that he erroneously dealt with the joinder and adjournment applications separately. Specifically, it was said that his Honour did not consider the need for an adjournment and vacation of the hearing date, when deciding whether to allow the joinder application. In our view, neither of those submissions accurately reflects how the joinder application was dealt with.
The transcript shows that in the course of argument various possibilities for the future conduct of the proceedings were raised by the primary judge. They included that the joinder application be refused and the respondents be left to make a claim in separate proceedings against the proposed new defendants; that the joinder application be allowed and the hearing of the claim against the new defendants proceed separately; and that the joinder application be allowed and the hearing be adjourned. In relation to the last, there was reference to the likelihood that the joinder would result in an adjournment of the hearing beyond the following week and consideration of the prejudice which the applicants as existing defendants might suffer should that occur. Notwithstanding that likelihood, and because the proposed defendants were companies apparently related to the applicants, the primary judge allowed the joinder and stood the proceedings over to 8 May to give those defendants the opportunity to consider whether they could instruct the applicants' solicitors to act for them and accept service on their behalf, so as to be in a position to participate in a hearing commencing in the following week without the need for any further adjournment. Thus, the transcript shows that the need for an adjournment was considered and that the likelihood that any adjournment would be lengthy was recognised.
Secondly, it was said that the primary judge determined the joinder application solely on "convenience" grounds and did not take into account any "wider discretionary considerations" including the overriding purpose of the Uniform Civil Procedure Rules 2005 (including those permitting amendment and joinder) being to facilitate the just, quick and cheap resolution of the real issues in the proceedings: Civil Procedure Act 2005 (NSW), s 56. Reference was made to Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175.
The primary judge did not approach the question of joinder on the basis that the respondent was entitled to join additional parties against whom she had an arguable claim subject to payment of any costs thrown away by the applicants: cf Aon Risk Services at [111]. A fair reading of the transcript does not support the applicant's second contention. The matters raised in argument before the primary judge included the reasons why the legal representatives for the respondent (being her current and former solicitors) had not adequately addressed whether there was evidence to support the allegation of design and manufacture made against the applicants, and whether any evidence supported that allegation being made against one or more of the proposed defendants; whether the consequences of that failure should be borne by the respondent; whether the respondent appreciated that there may not have been any evidence that either of the applicants was the designer or manufacturer of the relevant machinery; the prejudice which the applicants might suffer as a result of the adjournment of the hearing; and the public interest in the efficient and timely disposal of all of the issues between the parties and proposed parties in the one proceedings.
Thirdly, it was said that the primary judge took into account an irrelevant matter, namely the possibility of granting the joinder and then ordering separate trials. As appears from the discussion above, that possibility was raised in the course of the primary judge testing the applicants' proposition that the joinder would necessarily involve an adjournment of the hearing. The transcript indicates that the primary judge proceeded on the basis that there could not be separate trials.
Fourthly, it was submitted that the primary judge found and acted on the assumption that the "manufacturer" of the relevant machinery "has had his hands in the entrails of this case from the beginning" (tcpt 06/05/15, p 58). That somewhat colourful language was used by the primary judge when raising for debate the question whether, assuming that there had to be an adjournment, it would need "to be a long adjournment". It was followed by discussion as to the prejudice likely to be suffered by the applicants in that event. Ultimately, as the transcript shows, the primary judge proceeded on the basis that "an adjournment for greater than next week would be seen as necessary" (tcpt 06/05/15, p 63).
The remaining matters relied on include that there was a failure to provide any reasons and that there was a failure to take into account, or give sufficient weight to, asserted failures on the part of the respondent's legal representatives to comply with their obligations under s 345 of the Legal Profession Act 2004 (NSW).
The extent of the duty to give reasons depends on the nature of the particular decision, the circumstances in which it is made and the purpose that the statement of reasons is intended to serve. In many procedural applications, there is no need for the court to provide any or detailed reasons. Here, when the relevant orders were announced on 6 and 8 May 2015, there were no reasons provided, that was obvious, and there was no request that they be provided. If a party is considering a challenge to interlocutory orders made in pre-trial directions or in the course of a trial, and it is apparent that the primary judge does not propose to give reasons, a request for reasons should be made at the time or as soon as possible thereafter. In this case the absence of reasons for the orders made, in circumstances where there is no obvious error in the exercise of the relevant discretion and no real utility in the pursuit of the proposed appeal, has not resulted in any substantial injustice to the applicants.
Finally, it is necessary to say something about the matter which the applicants described as constituting the "central fact" in their application for leave to appeal. That was said to be that the respondent's legal representatives had no evidentiary material available that constituted a proper basis for alleging that either the applicants or two of the three proposed defendants were involved in the design and manufacture of the relevant machinery. The absence of any such basis for making those allegations was said to constitute a breach by the respondent's former and current solicitors of their obligations under s 345.
In the course of argument, the primary judge took account of the deficiencies in the preparation and pursuit of the respondent's claim by her legal advisors. The respondent's current solicitor had given evidence explaining what he had and had not done, and what he had assumed in relation to the earlier preparation and conduct of the claim. That evidence suggested that the legal representatives had not sufficiently addressed the evidence available to prove the identity of the designer and manufacturer of the machinery. When addressing the costs order which should be made following the joinder and adjournment, counsel for the applicants submitted that the Court could not "ignore" the obligations of the solicitors under Pt 3.2, Div 10 of the Legal Profession Act (tcpt 08/05/15, p 80). In response, the primary judge pointed out that he did not have any application before him for an order that the respondent's current or former legal representatives be responsible for payment of any costs for which the respondent may be liable to the applicants: cf the position in Keddie v Stacks/Goudkamp Pty Ltd [2012] NSWCA 254; 293 ALR 764 where such an order was sought under s 348 of that Act.
The transcript shows that the primary judge took account of the conduct of the respondent's solicitors in the respects referred to above. In doing so he was not called upon to make any ruling as to whether those legal advisors had breached their obligations under the provisions of the Legal Profession Act.

Proposed appeal against order of 22 June 2015

The application that the primary judge disqualify himself for actual or apprehended bias was made in circumstances where the respondent's claim was not part heard before the primary judge and had been referred to the Registrar for further directions and case management. As the primary judge observed in his short reasons for rejecting the application "it is only speculative whether I shall be the trial judge". For that reason, and for reason that none of the specific matters relied upon provided any support for a conclusion of actual or apprehended bias, the application for leave to appeal out of time against the order made on 22 June 2015 was dismissed.
The question raised by the application for disqualification on the basis of apprehended bias was whether "a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question the judge is required to decide": Michael Wilson & Partners Ltd v Nicholls [2011] HCA 48; 244 CLR 427 at [31]. As the plurality judgment then observed at [63], it is necessary for the party asking a judge to disqualify him or herself, having identified the conduct said to give rise to the apprehension of bias through pre-judgment, to articulate the connection between that conduct and the possibility of departure from impartial decision-making with respect to the questions to be decided. See also Barakat v Goritsas (No 2) [2012] NSWCA 36 at [12] per Basten JA.
The applicants identified three specific respects in which the primary judge's conduct was said to show "a propensity or predisposition towards the respondent" (summary of argument, para 60). They were: first, in disregarding the relevant provisions in Pt 3.2, Div 10 of the Legal Profession Act; secondly, in disregarding the fact that the respondent had no liability evidence against the applicants; and thirdly, in making comments during the course of argument that the applicants were "keeping (their) money in their pocket" and that it was obvious that the "manufacturer here has had his hands in the entrails of this case from the beginning". The applicants also relied upon the other asserted "errors" of the primary judge in the exercise of the discretion on the joinder application as establishing the same "propensity or predisposition towards the respondent".
The applicants' argument does not attempt to identify any logical connection between the primary judge's conduct in disposing of the joinder application as he did and the possibility that he will depart from impartial decision-making in determining the issues to be decided at the final hearing (assuming, of course, that he is nominated as the trial judge). On the joinder application the primary judge was not required to determine any issue to be decided at trial or to form a view about the credibility of any relevant witness. The mere fact that the primary judge decided that application against the applicants and, in doing so, made some appealable error would not demonstrate bias or pre-judgment: see Michael Wilson & Partners at [67] where such arguments are described as "fallacious".
For the same reasons, the conduct relied on does not provide any basis for a conclusion that the primary judge had in fact pre-judged any issue to be decided at the trial.

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Judgment (7 paragraphs)

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