Modaressi v Aarf

Procedural history

1. As referred to above, orders were entered by the Local Court against Pedram Modaressi in favour of Mr Aarf on 14 May 2019.

The 2019 Appeal

1. On 28 May 2019, Pedram Modaressi filed a summons in this Court in proceedings 2019/166961 (the 2019 Appeal). The summons indicated that Brian Dodd was Pedram Modaressi's legal representative. The return date for the summons was 6 June 2019. The summons indicated that the whole of the "decision below" was the subject of appeal. The single ground of appeal was: "There was an error of law in that the Judge did not exercise his discretion in favour of the defendants [Pedram Modaressi and Behnam Modaressi] and find for the defendants."
2. The summons was served on Mr Aarf's solicitors on 29 May 2019.
3. On 6 June 2019, there was an appearance for Pedram Modaressi but not for Mr Aarf. The matter was stood over to 2 August 2019 and Pedram Modaressi's solicitor was directed to advise Mr Aarf's solicitor. On 2 August 2019 directions were made by consent that the matter be stood over for a month on condition that the (proposed) amended summons be filed within 14 days. The matter was stood over to 30 August 2019. On 14 August 2019 Mr Dodd, the solicitor on the record for Pedram Modaressi, served a notice of intention to cease to act on Pedram Modaressi.
4. On 30 August 2019, Mr Dodd appeared on behalf of Pedram Modaressi and asked that the matter be stood over to 27 September 2019 in order that he could obtain the transcript and exhibits from the Local Court.
5. On 18 September 2019 Mr Dodd filed a notice of ceasing to act.
6. On 27 September 2019, Pedram Modaressi appeared on his own behalf. There was no appearance on behalf of Mr Aarf. The matter was stood over to 15 November 2019. A direction was made for the plaintiff to file his proposed amended summons by 12 November 2019.
7. On 15 November 2019, Mr Alis, Mr Aarf's solicitor, appeared and Pedram Modaressi appeared for himself. Pedram Modaressi informed the Court that his solicitor had filed a notice of ceasing to act but that he had retained new solicitors. He also indicated that he was waiting for 5 exhibits. The matter was stood over to 29 November 2019.
8. On 29 November 2019, there was no appearance for Pedram Modaressi. Mr Aarf appeared by an agent. The Court indicated that a letter under Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 13.6 would be sent to Pedram Modaressi. The matter was stood over to the directions hearing on 20 December 2019.
9. On 2 December 2019 the Court sent letters to Pedram Modaressi and Mr Aarf pursuant to UCPR r 13.6 which said: "The matter was listed on 2 December 2019, there was no appearance by or on behalf of the plaintiff [Pedram Modaressi]. The matter has been re-listed for Directions (Common Law Registrar) on 20/12/19 at 09.00AM, Supreme Court - Civil, Supreme Court Sydney Court 9C Queens Square Sydney. If there is no attendance by or on behalf of the plaintiff on the adjourned date, the Court may dismiss the proceedings. …"
10. On 20 December 2019, the matter was listed before the Registrar. Mr Aarf appeared on his own behalf. There was no appearance by or on behalf of Pedram Modaressi. Accordingly the Court dismissed the summons, confirmed that there would be no further listings and ordered Pedram Modaressi to pay Mr Aarf's costs of 29 November 2019 and 20 December 2019.
11. On 28 January 2020 Mr Aarf's solicitor sent a letter to Pedram Modaressi advising that the proceedings had been dismissed and attaching a memorandum of costs in the sum of $5,500. The letter also contained a demand for payment of the judgment sum awarded by the Local Court.
12. On 23 April 2020 Mr Aarf's solicitor obtained an examination order from the Local Court in respect of Pedram Modaressi. On 15 May 2020, the Local Court ordered him to provide full and frank updated financial disclosure and listed the matter for compliance on 29 May 2020. Pedram Modaressi did not comply with these orders. Mr Alis, Mr Aarf's solicitor, wrote to Pedram Modaressi's solicitors, Barriston Lawyers, on 25 May 2020 in the following terms: "We refer to the above matter and to our correspondence dated 15 May 2020 in relation to Orders made at Parramatta Local Court on 15 May 2020, that your client provide full and frank, updated financial disclosure. I note both you and your client seemed adamant that we would have received the financial disclosure 'within a few days' from 15 May 2020. We remind you that your client has had a tenancy [scil, tendency] to ignore Court Orders, which has to date, caused our client to incur further vexatious costs. We also remind you that the matter is listed for compliance on 29 May 2020. Should you client fail to provide our firm with the necessary documents by 5:00pm, 27 May 2020, we will ensure that a further cost application is entertained on the next occasion."
13. On 28 May 2020, Mr Alis wrote to Behrooz Ehsani, the solicitor at Barriston Lawyers with conduct of the matter, as follows: "Please, immediately, provide our firm with the password required to access your clients payslip(s) and other necessary documents. Furthermore, we also require your clients 2017 Individual Tax return. We will further correspond with you in due course. Should you at all have any further questions, please do not hesitate to contact our firm."
14. On 19 August 2020, the Local Court notified the parties as follows: "On 19 August 2020 the following orders (and/or directions) were made: Wages or salary that Pedram Modaressi trading as Peddy Market is entitled to receive from time to time from WeWork Australia Pty Ltd of Level 19 181 William Street MELBOURNE VIC 3000 is attached until the amount of $85132.56, the judgment debt plus any interest which may accrue, is paid or until the Court otherwise orders. The garnishee is ordered to pay any amount so attached to the judgment creditor within 14 days after the date on which the wage or salary falls due."
15. I was informed by Mr Alis, and I accept, that a garnishee order was made in the sum of $3,500 per month. The first payment was made on 25 September 2020 and the second a month later. Accordingly, to date, an amount of $7,000 has been paid.

The 2020 proceedings

1. The present proceedings, 2020/261448, were commenced by summons dated 24 July 2020 but not filed until 8 September 2020. The summons identified Mr Ehsani of Barriston Lawyers as Pedram Modaressi's solicitor. The grounds set out in the summons are as follows: "1 The learned magistrate erred in applying the wrong legal rule to the facts, namely, the reasons between lines 6 and 29 of page 81 of the transcript. 2 The learned magistrate erred by failing to determine the real issue between the parties namely whether the monies were received by the defendants jointly or severally. 3 The learned magistrate erred by failing to take into account the written agreement dated 25 April 2016. 4 The learned magistrate erred by failing to give reasons why he did not take the written agreement dated 25 April 2016 into account. 5 The learned magistrate erred in failing to draw the proper inference of fact from the written agreement which required the first defendant to pay the plaintiff. 6 The learned magistrate erred by drawing the wrong inference of fact from the email dated 2 March 2016 enclosing an offer to pay $80,000 to the plaintiff. 7 The learned magistrate erred in failing to accord procedural fairness by entertaining any application for adjournment."
2. As with the 2019 proceedings, Mr Aarf was named as the first defendant and Behnam Modaressi was named as the second defendant. Behnam Modaressi has not filed an appearance in either proceedings.
3. Pedram Modaressi affirmed an affidavit on 24 July 2020 which was filed with the summons on 8 September 2020. The following paragraphs from the affidavit were tendered by Mr Alis in support of the notice of motion for dismissal: "1 I [Pedram Modaressi] am the plaintiff in these proceedings. 2 I was unrepresented. I was aware that I had to appeal within 28 days. 3 I sought the service of a solicitor to appeal the decision of the magistrate but I was informed by my solicitor that it would cost $45,000.00 in legal fees. I could not afford that amount so I did not proceed with the appeal application. 4 I have since found a solicitor who is prepared to do it for much less."
4. In an affidavit affirmed on 6 November 2020 which was read by Mr Yeh, who appeared on behalf of Pedram Modaressi, in opposition to Mr Aarf's notice of motion for dismissal, Mr Ehsani deposed in part: "1 I am the solicitor on record and with carriage of the plaintiff's case. 2 When I received instructions from the plaintiff, I was not informed by the plaintiff that he had commenced proceedings last year seeking to appeal the decision under appeal in these proceedings. 3 I commenced these instant proceedings upon that understanding. …"
5. On 17 September 2020, the first return date, Mr Yeh appeared for Pedram Modaressi and Mr Alis appeared for Mr Aarf. The matter was stood over for directions on 24 September 2020. On that day, Mr Yeh again appeared for Pedram Modaressi and Mr Alis appeared for Mr Aarf. The matter was stood over for directions on 8 October 2020 and the costs of the day were reserved.
6. Mr Ehsani only became aware as a result of the directions hearing on 24 September 2020 that there had been previous proceedings. He deposed in his affidavit: "4 It became apparent to me following the first directions hearing on 24 September 2020 that the plaintiff had initiated proceedings last year in this Court being proceedings numbered 2019/166961. 5 In proceedings numbered 2019/166961 the plaintiff sought leave to appeal the decision of the magistrate in proceedings numbered 2018/0215973. He is appealing the very same decision in these proceedings before the Court. 6 In proceedings numbered 2019/166961 Registrar Jones of the Supreme Court dismissed the proceedings for the plaintiff's failure to appear. I understand that the plaintiff had some difficulty with obtaining copies of the exhibits from the Local Court."
7. Although there is a potential inconsistency between what Mr Ehsani said in paragraph 4 of his affidavit and what Pedram Modaressi said in his affidavit of 24 July 2020 (which was witnessed by Mr Ehsani), this need not be addressed for present purposes. In any event, Mr Ehsani was not cross-examined.
8. On 8 October 2020, the appearances were as before. The Registrar listed Mr Aarf's notice of motion which had been filed on 24 September 2020 for hearing on 16 November 2020 and made directions for filing and service of evidence and submissions which included an order that Pedram Modaressi file and serve any written submissions by 4 November 2020.

Relevant legislation and rules

1. Section 56(1) of the Civil Procedure Act 2005 (NSW) (the Act) provides that the overriding purpose of the Act and the UCPR is "to facilitate the just, quick and cheap resolution of the real issues in the proceedings". I am required to seek to give effect to that purpose when making decisions under the Act and the UCPR: s 56(2). The parties have a corresponding obligation to assist the Court to further the overriding purpose.
2. Section 67 of the Act empowers the Court to grant a stay of proceedings. This provision has been used to authorise a stay of proceedings in circumstances where a plaintiff seeks to bring proceedings which are the same as proceedings which have been dismissed and where the specific provisions of the UCPR do not apply.
3. UCPR r 12.10 provides: "Stay of further proceedings to secure costs of proceedings dismissed If - (a) as a consequence of the dismissal of proceedings, a party is liable to pay the costs of another party in relation to those proceedings, and (b) before payment of the costs, the party commences further proceedings against that other party on the same or substantially the same cause of action, or for the same or substantially the same relief, as that on or for which the former proceedings were commenced, the court may stay the further proceedings until those costs are paid and make such consequential orders as it thinks fit."
4. UCPR, r 42.20 relevantly provides: "Dismissal of proceedings etc (1) If the court makes an order for the dismissal of proceedings, either generally or in relation to a particular cause of action or in relation to the whole or part of any claim, then, unless the court orders otherwise, the plaintiff must pay the defendant's costs of the proceedings to the extent to which they have been dismissed. …"

Consideration

1. Mr Alis submitted that the 2020 proceedings were vexatious since they were simply a duplication of the 2019 proceedings, in respect of which no offer to pay the costs orders had been made. He contended that it was telling that Pedram Modaressi had not even told Mr Ehsani about the 2019 proceedings when he instructed him to commence the 2020 proceedings.
2. Mr Alis acknowledged the Court's power to stay the 2020 proceedings until Pedram Modaressi paid Mr Aarf's costs. However, he contended that there was no point in making such an order since Pedram Modaressi had made no offer to pay those costs and had obstructed the claim for the garnishee order. He submitted that the appropriate order was to dismiss the proceedings.
3. Mr Yeh sought to read the following paragraph from Mr Ehsani's affidavit of 6 November 2020 as a submission in opposition to the notice of motion, and in support of a notice of motion for a stay which has not been filed by Pedram Modaressi: "7. It is my considered view that if these proceedings are not stayed, the plaintiff will have to commence proceedings in the Court of Appeal to appeal the dismissal of these proceedings for duplication. It would lead to an inordinate waste of legal costs. It is for these reasons that I seek a stay of these proceedings pending the decision of the Court of Appeal in reviewing the decision of Registrar Jones."
4. Mr Yeh contended that, if the 2020 proceedings were dismissed, it would be necessary for Pedram Modaressi to seek leave to appeal against the Registrar's dismissal of the 2019 proceedings. When I enquired as to the alleged error made by the Registrar in dismissing the proceedings on 20 December 2019, Mr Yeh said that the Registrar's discretion had miscarried because there were arguable grounds of appeal and that Pedram Modaressi had indicated to the Court on previous occasions that he had difficulty locating exhibits from the Local Court proceedings. Mr Yeh did not develop this submission.
5. Mr Yeh acknowledged that he did not have any instructions that Pedram Modaressi was either prepared, or in a position, to pay Mr Aarf's costs of the 2019 proceedings. Mr Yeh also submitted that, in light of the garnishee order, it would be difficult for Pedram Modaressi to come up with any amount for Mr Aarf's costs. Although he submitted that Pedram Modaressi ought be given an opportunity to make an offer concerning Mr Aarf's costs, Mr Yeh adduced no evidence which would suggest that this would be other than an exercise in futility which would increase the costs incurred by Mr Aarf.
6. Although a party to proceedings which have been dismissed is entitled to commence "fresh" proceedings on the same basis, there are limits to this entitlement. For example, the Court may stay the second proceedings until the defendant's costs of the first proceedings have been paid: UCPR, r 12.10. The Court may also dismiss the proceedings under UCPR, r 13.4 on the basis that they are vexatious and an abuse of process.
7. I have considered whether to dismiss the proceedings, stay the proceedings until the costs of the 2019 proceedings are paid or order security for costs. The difficulty with the second and third options is that each would require Mr Aarf to incur further costs without any expectation of any corresponding benefit.
8. Pedram Modaressi's response to the proposition that the 2020 proceedings amounted to an abuse of process was manifestly inadequate. Pedram Modaressi has not explained his own failure to engage with the Court's processes (under s 67(3) of the Act) once his solicitor, Mr Dodd, had ceased to act in the 2019 proceedings. I am, in the absence of any substantive submissions, at a loss to discern any basis on which the Registrar's decision to dismiss the proceedings under UCPR r 13.6 was erroneous. Mr Yeh has identified none. The assertion that Pedram Modaressi could not afford Mr Dodd but can afford Barriston Lawyers does not amount to an explanation as to why he failed to appear at directions hearings once Mr Dodd had ceased to act. Nor has he offered to pay any amount referable to the costs of the 2019 proceedings for which he is liable. Nor has Mr Yeh sought to persuade me that any of the grounds of appeal have any substance. These matters are all to be taken into account on this application since they arise for consideration under s 58 of the Act.
9. Pedram Modaressi has been almost entirely lacking in diligence in prosecuting his application for leave to appeal from the Magistrate's judgment which was entered more than 18 months ago. He failed to comply with the Court's directions on several occasions in 2019. While his impecuniosity might explain why he found it difficult to obtain and maintain legal representation, he had a right to appear for himself and has not explained why he failed to appear at several directions hearings, including the last two. He has repeatedly breached his duty under s 56(3) of the Act. There is no evidence that Pedram Modaressi has made any attempt to ameliorate the prejudice occasioned to Mr Aarf, who has been legally represented and who has continued to incur costs as a consequence of Pedram Modaressi's conduct of the 2019 and 2020 proceedings. In these circumstances, I am persuaded that the proceedings constitute an abuse of process and ought be dismissed.

Costs

1. Neither party put forward any reason why costs ought not follow the event in accordance with the general rule: UCPR, r 42.1.

Orders

1. For the reasons given above, I make the following orders: 1. Pursuant to Uniform Civil Procedure Rules 2005 (NSW), r 13.4, dismiss the summons filed on 8 September 2020. 2. Order the plaintiff to pay the first defendant's costs of the proceedings, including the costs of the first defendant's notice of motion filed on 24 September 2020.

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