Michail v Mount Druitt and Area Community Legal Centre Inc

Procedural history of the litigation

1. Although proceedings were only commenced on 20 February 2015, the pleading which was the subject of the decision by the primary judge on 24 September 2015 was the third further amended statement of claim.
2. There was correspondence between Ms Michail and the solicitor acting for the Community Legal Centre on 11 March 2015 in relation to the statement of claim filed on 5 March 2015. (On 20 February 2015, the proceedings had been incorrectly commenced by summons.) The solicitor wrote: "We have been instructed to write to you about the deficiencies in your statement of claim. In this regard, we are aiming to send our letter by the end of this week or early next week."
3. Ms Michail advised, promptly thereafter, that: "This is a courtesy email to let you know that I will be lodging an amended statement of claim by the end of this week by the latest and this is the reason for asking in relation to any objections. You used the word 'deficiencies' and I do not interpret this word as objections. Unless you advise to the contrary, I will go ahead and lodge my amended statement of claim by Friday, 13 March 2015."
4. Later that afternoon, the solicitor responded: "Please ensure that your Amended Statement of Claim complies with Part 19 rule 5 of the Uniform Civil Procedure Rules (NSW) 2005, including marking-up any changes. Please also serve the filed copy on us electronically and by express post. Our client reserves all of its rights."
5. It will be seen below that one of Ms Michail's complaints, both to the primary judge and in support of her application for leave, was based on this exchange.
6. It appears that the amended pleading foreshadowed by Ms Michail was filed on 11 March 2015. It attracted a notice of motion filed on 9 April 2015, under which the Community Legal Centre sought either for it to be struck out in its entirety, or for a series of identified paragraphs to be struck out.
7. Ms Michail was, and is, concerned that the notice of motion did not comply with Practice Note 6 (District Court Defamation List). She points to two sentences in that Practice Note: "Any application for interlocutory rulings should include a concise description of the issues and list of authorities" and "Notices of Motion are not required for interlocutory arguments unless otherwise ordered".
8. Her principal complaint was, and is, that there was no concise description of issues or list of authorities. However, the notice of motion had been preceded by a six page letter dated 16 March 2015 identifying what were said to be deficiencies in the pleadings.
9. A further amended pleading was filed on 25 May 2015. The Community Legal Centre's solicitors sent a detailed letter of objections to that pleading on 11 June 2015. One of the judgments first supplied to this Court the day before the hearing of the leave application was one given on 18 June 2015 by the primary judge, whose opening paragraph was as follows: "This judgment is a short outline of the issues concerning the plea of defamation in these proceedings, and is intended to summarise, in a somewhat informal way, the points I made when discussing these problems in court with the plaintiff on 18 June 2015. The purpose is to assist the plaintiff, who is distressed by the events leading up to the bringing of this claim, as well as by a recent bereavement."
10. The judgment deals with the history of the pleading, and extracted parts of it. It referred to the letter of 11 June 2015 and described it as "unhelpful to the court, as well as to the plaintiff, in that it simply lists pleading errors and refers the plaintiff to the relevant Rules." Her Honour then identified "what I see as the principal problems with the defamation claims as currently pleaded" over some 15 paragraphs. Her Honour then recorded at [28]-[29]: "Although these proceedings have only been in this court on one prior occasion, the plaintiff has, between 7 April and 18 June, forwarded 23 emails to my associate, some of which were not sent to the defendant. These emails were not in response to any correspondence from the defendant. The defendant had only forwarded one email to my associate, on 7 April 2015, inquiring about the applicability of the Practice Note (it should be noted that the Practice Note, prior to amendment on 3 June 2015, did not apply to proceedings outside the Sydney registry). In the course of her correspondence, the plaintiff has expressed concerns that the defendant has been corresponding with the court. Not only is this wrong, but it would be improper of the defendant to do so. No party to litigation should correspond with the court, other than for the purposes of fixing or altering a court date, without a court order to that effect, and copies of any such letters should always be provided to the opposing party. Any emails forwarded to my associate of this kind in the future will be deleted without being read."
11. Ms Michail was directed to file and serve a second further amended statement of claim by 16 July 2015.
12. That second further amended statement of claim was filed and served on 27 July 2015. It attracted a letter dated 29 July 2015 from the Community Legal Centre's solicitors which identified objections they had to the pleading. They further said: "In light of the above and the history of these proceedings, our client proposes to seek an order that your claim be referred for legal assistance pursuant to Part 7 rule 33 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR). If her Honour Judge Gibson is not prepared to make that order, our client will seek orders for a timetable to apply to strike out the [pleading] pursuant to Part 14 rule 14.28 of the UCPR."
13. At a directions hearing on 30 July 2015, Ms Michail submitted that there had been non-compliance with the Practice Note, and the primary judge made a referral for legal assistance.
14. Following the acceptance of a pro bono referral, the third further amended statement of claim was filed on 24 August 2015. Ms Michail placed great reliance upon what was said at a directions hearing following that occurring on 3 September 2015. On that occasion, her Honour is recorded as saying: "I am satisfied, having received an email from [the Registrar] confirming these details, that my referral for legal assistance to draft and settle a third further amended statement of claim has in fact taken place …"
15. Nevertheless, her Honour put in place a timetable for the hearing of the notice of motion to strike out passages of the pleading. In light of the complaints made by Ms Michail, it is appropriate to reproduce the following exchange: "PLAINTIFF: Your Honour, may I be heard in relation to this? HER HONOUR: Yes, of course. PLAINTIFF: Basically, last - on 30 July, your Honour made the order sought by the defendants themselves to refer me to a pro bono lawyer on the pro bono panel. I complied with the order. The defendants are still not pleased with the order they themselves sought and I complied with in spite of the fact that I have requested on many occasions that they submit a list of objections with fact matters and a list of authorities, and they were the ones who declined this invitation by me made in open court and my email of 31 July 2015. HER HONOUR: Yes, look, Ms Michail, the thing is they have filed a notice of motion in April and it's been stood over to enable you to re-plead. You have now had some legal assistance. And I think the statement of claim which I have read does answer a number of the issues raised. But nevertheless, they have a notice of motion which I have to hear. The only question is what date do I hear it on? PLAINTIFF: All right."
16. On 14 September 2015 the Community Legal Centre filed an amended notice of motion, seeking an order that the proceedings be dismissed, or alternatively that the proceeding be struck out. The motion was accompanied by written submissions signed by counsel, which, in paragraph 27, identified seven areas in respect of which it was said that the pleading was defective.
17. The motion came on for hearing on 24 September 2015. After hearing from counsel for the applicant on the motion at some length, Ms Michail interrupted. There was the following exchange: "PLAINTIFF: I think we've been through this. It's -- HER HONOUR: Ms Michail, will you sit down? This is set down for two hours. I'm giving your opponent a chance. PLAINTIFF: We've been through this, your Honour. HER HONOUR: We haven't. May I say, Ms Michail, that the best evidence that your opponent has of the hopelessness of this case is your conduct of it, so you don't help when you make those kinds of interventions."
18. Towards the end of submissions by counsel for the Community Legal Centre, there was the following exchange: "HER HONOUR: I read these pleadings, and I read a lot of bad pleadings. I have to say, Ms Michail, this is one of the worst pleadings I've ever seen. PLAINTIFF: Sorry, your Honour. HER HONOUR: It's dreadful. PLAINTIFF: I apologise. HER HONOUR: No, I don't want you to apologise, because if I give you a chance to amend it, if you don't fix it up next time-- PLAINTIFF: I'm not seeking amendments at all, by conduct by [sic] and by words the, the defendants-- HER HONOUR: If you don't amend this pleading it will be struck out. PLAINTIFF: May I, may I be heard? HER HONOUR: No, Ms Michail. PLAINTIFF: May I be heard, please? HER HONOUR: No, you may not. PLAINTIFF: The, the opponent has been heard for an hour. HER HONOUR: Ms Michail, please sit down. PLAINTIFF: May I be heard? HER HONOUR: No, you may not. I'm still hearing from your opponent. PLAINTIFF: But you were speaking with me just then, your Honour, and I would like to, to respond. HER HONOUR: No, I am giving you a warning, when I do hear from you I am telling you that while I may grant you leave to amend-- PLAINTIFF: So you've already predetermined a judgment before you can hear me, your Honour. HER HONOUR: No, Ms Michail, what I'm indicating to you is a warning that I'm concerned about the inadequacy of your pleading and that any further-- PLAINTIFF: Well, then I'm going to have to go back on the barrister who assisted me, because I complied with your order and this is the best advice she has given me. HER HONOUR: Please sit down. I am simply giving you a warning that when you do address me you need to address me as to why any order I make for you to amend should not be for your final amendment. PLAINTIFF: Well, I'll just go on the barrister that assisted-- HER HONOUR: Yes, thank you. I'm sorry, I interrupted you. Please continue."
19. At the conclusion of those submissions, complaints were made by Ms Michail that her Honour was "quite biased", and she then returned to the email exchanges of 11 March 2015. The primary judge raised with counsel for the Community Legal Centre whether particular paragraphs of the pleading should be struck out, in the event that her Honour was not persuaded to dismiss the proceedings or strike it out in its entirety. There followed the following exchange with counsel for the Community Legal Centre: "CASE: Yes, your Honour. I could today run through the third amended statement of claim with you and indicate which paragraphs should be struck out on the strength of our submissions on the strike out application, particularly pursuant to para 27 which particularises paragraphs and identifies what the problem with those paragraphs are. HER HONOUR: I see, well that's very helpful, thank you. Yes, Ms Michail, what about if we do that now, if we deal with it-- PLAINTIFF: No, I would like to be heard, your Honour-- HER HONOUR: All right, well off you go. PLAINTIFF: --because that would be a waste of the Court's time, really. According to-- HER HONOUR: I'm glad to hear you think so because I think many of the points that are raised in para 27 are good. PLAINTIFF: Well-- HER HONOUR: If you're not going to address them, then I'll just strike them out, won't I? PLAINTIFF: According, according - your Honour, you can't make these [orders] without hearing me out. That shows immediate bias. HER HONOUR: It's not bias, Ms Michail-- PLAINTIFF: It is, your Honour. HER HONOUR: I have said I'm going to hear you out but if you won't address - if you refuse to address para 27 of your opponent's submissions, what am I to do?"
20. Following that exchange Ms Michail addressed with very few interruptions or questions from the primary judge for some five pages of transcript. She did not address the particular matters contained in paragraph 27 of the written submissions. In answer to a submission that the Community Legal Centre had agreed not to object to the current state of the pleadings, there was this exchange: "HER HONOUR: Ms Michail, can I remind you that their notice of motion to strike out your statement of claim was filed in April. It has never gone away. You have been under the gun from day one that they're not happy with your pleadings. PLAINTIFF: This-- HER HONOUR: You have a law degree so there is more than usual reason for you to expect that you should be able to draft a-- PLAINTIFF: Your Honour-- HER HONOUR: --statement of claim-- PLAINTIFF: --that-- HER HONOUR: --and it's still a very poorly drafted document. PLAINTIFF: That's not my responsibility. HER HONOUR: Yes, it is-- PLAINTIFF: No, it isn't. HER HONOUR: --you are the plaintiff. Ms Michail, it is your responsibility-- PLAINTIFF: Well I can go to the NSW Bar Association and say to them why hasn't she advised me as she should? Is it negligence or was it a conflict of interests? HER HONOUR: Ms Michail, it is your problem because if you don't draft a proper statement of claim then I'm going to have to strike it out."
21. After a further exchange when it appears that Ms Michail was speaking over the primary judge, her Honour returned to paragraph 27: "HER HONOUR: Ms Michail, I've told you I want to address para 27 of your opponent's submissions. What do you have to say about paragraph--"
22. In the course of further submissions to the effect that the Community Legal Centre had agreed to the form of the pleading, there followed this exchange: "HER HONOUR: Ms Michail, after, after this conversation where you say they accepted, they filed a notice of motion to strike out your pleadings. That's the motion I'm hearing today. PLAINTIFF: It's, it's irrelevant of the fact that they represented to me by their words and conduct that they wouldn't do that. Just because they abuse the process it doesn't make me in error-- HER HONOUR: That doesn't mean - yes, Ms Michail, it doesn't mean that they aren't entitled to bring this motion. PLAINTIFF: Well you know what, your Honour, we're going to have to agree to disagree and I'm going to have to take it to the Supreme Court. HER HONOUR: All right, well in that case we'll agree to disagree and you can take it to the Supreme Court. PLAINTIFF: Thank you, your Honour."
23. Shortly thereafter, Ms Michail asked to be excused. She said: "I'm just going to have to appeal it. I - this is a waste of time". Ms Michail left the room at 12.10pm. As she did so, she made a series of allegations of bias and about the law firm acting for the Community Legal Centre. After Ms Michail left the courtroom, counsel for the Community Legal Centre proceeded through the pleading identifying paragraphs which, so she submitted, should be struck out.
24. The primary judge rejected the principal application made by the Community Legal Centre that the proceedings be dismissed, or the whole statement of claim be struck out. However, some paragraphs were struck out, mostly with liberty to re-plead, as noted above.

The submissions in support of leave to appeal

1. The written submissions in support of Ms Michail's application for leave were difficult to understand, or indeed even to summarise. By way of representative example, p 2 of the submissions in reply is annexed to these reasons. The oral submissions, although very lengthy, were helpful to explain what Ms Michail regarded as the essential problems in what had occurred. Doing the best we can, those complaints were as follows.
2. First, it appears that Ms Michail seeks to rely upon the email exchanges of 11 March 2015 outlined above. They were said by Ms Michail to amount to a representation that there were no objections to the pleading. But it is obvious that the chain of emails does not support the conclusion drawn by Ms Michail. Even were that not so, the filing of a notice of motion on 9 April 2015 and the correspondence and submissions that ensued thereafter made the Community Legal Centre's attitude clear beyond argument.
3. Secondly, Ms Michail considers that Southern Cross Exploration NL v Fire & All Risks Insurance Co Ltd (1985) 2 NSWLR 340 supports her view. The decision is to the effect that in some circumstances a party may be bound by the acceptance of an opposing party's particulars. She is wrong to consider that Southern Cross Exploration has any application to her position. There has never been an acceptance by the Community Legal Centre of the adequacy of her pleading. At all times the Community Legal Centre reserved all of its rights and promptly filed notices of motion seeking to have the pleading struck out.
4. Thirdly, Ms Michail was and is under the view that the referral to a pro bono barrister to "settle" the pleading and the acknowledgement by the primary judge on 3 September 2015 that that referral had taken place was an end to the complaints. That misunderstands what occurred. It may be that Ms Michail confuses between "settling" a document and "settling" a dispute in court. It may also be that because it was the Community Legal Centre that applied for the pro bono referral in order to settle the pleading, which application was granted, she held and holds the view that it was not open to the Community Legal Centre to apply for the pleading, so amended, to be struck out. There may be other reasons that Ms Michail holds that view. However, it is wrong.
5. There is nothing to suggest that the Community Legal Centre waived its rights to object to what it said was a defective pleading by its application for a referral for pro bono legal assistance. At all relevant times, there was a motion filed by it for the proceeding to be struck out. Ms Michail submitted that the primary judge should not, in light of that history, have heard and determined the amended notice of motion. That misunderstands the role of courts to deal with disputes that are raised by the parties to litigation.
6. Fourthly, Ms Michail complains that there was non-compliance with the portions of the Practice Note referred to above. In part this seems to be based on an understanding that applications by way of notice of motion are not permitted in proceedings to which the note applies. Any such understanding is incorrect. In part, Ms Michail continues to complain that a list of authorities was not provided to her. However, she had the benefit of written submissions which included references to the authorities upon which the Community Legal Centre relied.
7. Fifthly, Ms Michail complains about the way she was treated on 24 September 2015. As will be clear from the transcript extracted above, what essentially occurred was this. The primary judge heard first, and at some length, from counsel for the moving party, seeking to strike out the statement of claim or dismiss the proceedings. The primary judge objected to an interruption from Ms Michail in the course of submissions. Her Honour indicated a view that aspects of the pleading were defective. That view is self-evidently correct, and we did not understand Ms Michail to make any oral submissions to the contrary.
8. However, her Honour also indicated a tentative view, favourable to Ms Michail, that she was not minded to accede to the application to dismiss the proceedings or strike out the entirety of the pleading. Her Honour then, repeatedly, invited Ms Michail to address the detailed criticisms of individual paragraphs. Counsel for the Community Legal Centre offered to go through those criticisms orally. Ms Michail made it quite clear that she did not wish that to occur. The primary judge, repeatedly, directed Ms Michail to address the particular complaints about particular paragraphs. This Ms Michail declined to do. Instead, she returned to the matters referred to above. Finally, rather than remaining in the courtroom to hear the submissions to be made by the Community Legal Centre, Ms Michail left the courtroom.
9. It is to be recalled that those exchanges occurred in a context where, highly unusually, the primary judge had already provided a judgment constructively identifying matters in the pleading which required attention.
10. There was nothing procedurally unfair in what occurred. It was wrong for Ms Michail to interrupt her opponent's submissions, and right for the primary judge to insist on hearing first from the moving party.
11. Ms Michail went so far as to complain of a breach of procedural fairness in that submissions were made in her absence as to the defects in the pleading. It is true that those submissions went beyond what had been contained in paragraph 27 of the Community Legal Centre's written submissions, and counsel for the Community Legal Centre candidly and forthrightly acknowledged as much. But the obligation to accord procedural fairness is discharged by providing an opportunity to be heard. It was Ms Michail who turned down the opportunity to hear those submissions. It was Ms Michail who thereafter left the courtroom before they were made. It was quite wrong for Ms Michail to make the serious allegation that she had not been treated in a way which was procedurally fair.
12. Sixthly, Ms Michail complained that she was suffering from stress at the time, and indeed that she was ill. Despite the voluminous materials supplied by Ms Michail in support of her application for leave, there was no evidence provided in support of that submission. Moreover, what she said at the time was not that she was leaving because of illness, but because she was minded to appeal to the Supreme Court.
13. Seventhly, Ms Michail relied heavily on this Court's decision in Goater v Commonwealth Bank of Australia [2014] NSWCA 382; 88 NSWLR 362, setting aside a default judgment obtained by the bank from the District Court when the bank had contravened obligations assumed by it when a customer had lodged a dispute with the Financial Services Ombudsman. Ms Michail sought to translate the factual findings in that case to the conduct by the Community Legal Centre in the proceedings commenced by her. To be clear, it should be noted that (a) factual findings in one matter do not automatically translate to other matters, (b) Goater was a case where there was default judgment, and (c) Goater was also a case where it was demonstrated that the bank had departed from procedural obligations binding upon it. Goater is not relevant to Ms Michail's application for leave.
14. Eighthly, to the extent that Ms Michail complained about the actual or apparent bias by the primary judge, it must be said that the complaints are, so far as the materials disclose, entirely without foundation. To the contrary, both the judgment and the transcripts of the hearings disclose a judicial officer taking considerable efforts to hear the merits of the application and to assist Ms Michail. That is seen by the judgment delivered on 18 June 2015, by the efforts which are apparent from the exchanges reproduced above to elicit constructive assistance from Ms Michail, and by the fact that the primary judge ruled against the Community Legal Centre on its principal submissions.

Conclusions and orders

1. What is generally required to obtain a grant of leave from an interlocutory judgment is a demonstration by the applicant for leave that there is a question of principle, or a matter of public importance involved, or where there is an injustice which goes beyond that which is merely arguable: see Carolan v AMF Bowling Pty Ltd [1995] NSWCA 69; Lee v New South Wales Crime Commission [2012] NSWCA 262; 224 A Crim R 94 at [12].
2. None of the matters of which Ms Michail made complaint is made out. Ultimately, Ms Michail needs to demonstrate that there has been a reasonably clear case of injustice in order for leave to be granted on the interlocutory decision of the primary judge. This she has signally failed to do. The application for leave must be dismissed, with costs.
3. Ms Michail had also sought, by motion filed in this Court, a stay of the proceedings in the District Court. (The Court was told that the litigation had in fact been stayed pending the determination of this application.) The result of dismissing the application for leave to appeal is that the notice of motion must also be dismissed.
4. The Community Legal Centre sought an order that its costs be paid on an indemnity basis. Such an order is only made in very clear cases. The Community Legal Centre claimed indemnity costs, albeit without supporting reasons, in the response to Ms Michail's application for leave to appeal, which it filed and served on Ms Michail. Ms Michail filed a reply to the response in which she made no submissions on the question of costs. Nor did she make any response in the further submissions supplied shortly before the hearing, or in her oral submissions. As indicated above, Ms Michail is admitted to practise as a lawyer, and it must be assumed that she sought to say nothing in reply. It will be evident from the foregoing that an order for indemnity costs is appropriate in the present case.
5. The formal orders of the Court are: 1. Summons seeking leave to appeal dated 5 October 2015 and notice of motion dated 5 October 2015 be dismissed. 2. Ms Michail to pay the costs of the Mount Druitt and Area Community Legal Centre Inc, such costs to be assessed on an indemnity basis.

Extract - Applicant's submissions in reply, filed 10 November 2015 (63.2 KB, pdf) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 16 December 2015