Patial v Kailash Lawyers Pty Ltd

Catchwords: CIVIL PROCEDURE – transfer of proceedings – other proceedings on foot in Federal Court and District Courts – application to have District Court proceedings transferred to Supreme Court and then for both State proceedings to be transferred to Federal Court –transfer ordered
CIVIL PROCEDURE – pleadings – application to strike out late filed defence and entry of default judgment– application dismissed

Legislation Cited: Civil Procedure Act 2005 (NSW) ss 56, 140,
Fair Work Act 2009 (Cth) ss 604, 725, 729
Jurisdiction of Courts (Cross Vesting) Act 1987 (NSW) ss 5, 5(1), 8
Legal Profession Uniform Law (NSW)
Superannuation (Administration) Act 1992 (Cth)
Supreme Court Rules 1970 (NSW)
Uniform Civil Procedure Rules 2005 (NSW) rr 14, 14.3, 14.3(1), 14.28, 16.2(1), 16.2(2)(c), 42.1

Cases Cited: Akai Pty Ltd v People's Insurance Co Ltd (1996) 188 CLR 418; [1996] HCA 39
Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559; [2001] HCA 1
BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61
Bushby v McKenzie (1991) 19 SR (NSW) 104
Cabport Pty Ltd v Marinchek (No 2) [2013] NSWCA 131
CHP Asset Management Pty Limited v Maison Global Property Pty Limited [2023] NSWSC 992
Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63
Gemma Constantinidis v Maxwell William Prentice in his capacity as trustee for the Estate of George Constantinidis [2023] NSWSC 128
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69
In the matter of Patial [2023] HCATrans 095
Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11
Patial v Kailash Lawyers Pty Ltd [2021] FWC 4167
Patial v Kailash Lawyers Pty Ltd [2021] FWCFB 6055
Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants (No 1) [2022] FCA 662
Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2023] FCAFC 155
Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2024] FCA 179
Re Murray; Ex parte Hillman [1961] NSWR 573
Re Wakim 198 CLR 511; [1999] HCA 27
Ritchie v Gumley (1954) SR (NSW) 334
Smith v Smith (No 3) (1986) 161 CLR 217; [1986] HCA 36
Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261; [1983] HCA 36
Sultan v Dubboussi [2024] NSWSC 683
Valceski v Valceski [2007] NSWSC 440
Zhang v Levingston [2023] 1559

Category: Procedural rulings

Parties: Prateek Patial (Plaintiff)
Kailash Lawyers Pty Ltd (Defendant)

Representation: Counsel:
Mr V Misra (Defendant)
Solicitors:
Prateek Patial (Plaintiff) (Self-Represented)
Wotton Kearney (Defendant)

File Number(s): 2024/283199

Publication restriction: Nil

JUDGMENT

1. In 2019 and 2020 Mr Patial, then a migration agent who had completed legal studies, engaged in supervised legal practice under a written agreement with Kailash Lawyers Pty Ltd, of which Mr Pall is the sole director and principal solicitor. There is no issue that Mr Pall was also its controlling mind and that it was he who supervised Mr Patial. The supervision agreement expressly provided that there was no employment relationship between the parties.

2. In these proceedings Mr Patial contends that the agreement was a sham and that he was an employee. He seeks to have the agreement set aside, as well as various other relief, including damages for professional negligence.

3. This is pursued despite Mr Patial having already unsuccessfully brought proceedings in the Fair Work Commission in which he also claimed that he had been an employee, relying on various documents in which Mr Pall had so described him: Patial v Kailas**h Lawyers Pty Ltd [2021] FWC 4167. Mr Patial’s application for leave appeal against that decision also failed: Patial v Kailas**h Lawyers Pty Ltd [2021] FWCFB 6055.

4. Since then, Mr Patial has also brought other proceedings in the Federal Court, the High Court, this Court and the District Court arising out of the agreement and its termination. A number of proceedings in the Federal Court remain on foot.

5. This judgment deals with:

6. The motion by which Kailash Lawyers seek orders transferring the District Court proceedings to this Court and then to transfer it and these proceedings to the Federal Court: s 140 Civil Procedure Act 2005 (NSW) and ss 5 and 8 Jurisdiction of Courts (Cross*-vesting)* Act 1987 *(*NSW); and

7. The motion by which Mr Patial seeks orders striking out the defence which was filed in these proceedings some 17 days late; the entry of default judgment in his favour; as well as the imposition of “sanctions” against Kailash Lawyers and Mr Pall for misleading the Court and breaching claimed statutory and professional obligations and related professional standards.

Issues

6. In issue between the parties is whether the orders which they each seek by their motions can justly be made, given applicable provisions of the Civil Procedure Act, the Cross-vesting Act, the Uniform Civil Procedure Rules 2005 (NSW), the jurisdiction of the Federal Court and Mr Patial’s exercise of his right to bring separate proceedings in two State Courts.

7. These issues must all be determined in light of the litigious path which the parties have pursued, they having resulted in decisions by which they remain bound, including in relation to Mr Patial’s claimed employment.

Application to lead further evidence

8. After judgment was reserved, Mr Patial approached, seeking to lead further evidence and make further submissions. The parties finally agreed about this, although they did not entirely agree about how submissions should be dealt with.

9. Having considered what had been raised I ordered that:

“1. Mr Patial have leave to rely on the further documents which the parties have agreed;

2. Mr Patial file and serve those documents, together with his further short submissions about that further evidence, limited to 5 pages, on or before 4 pm on 26 February 2025

3. The defendant file and serve its response to those submissions, limited to 5 pages, on or before 4 pm on 5 March 2025.”

10. The reasons for those orders were that it was Mr Patial who had made the application to serve further evidence. He then wishing to tender documents he had filed in the Federal Court commencing further proceedings there, before the hearing of the motions the parties pursued in these proceedings. That was in order to respond to submissions which Kailash Lawyers had advanced at the hearing of the motions.

11. In those circumstances, consistent with the requirements of s 56 of the Civil Procedure Act, I concluded that Mr Patial should file his short submissions together with the further documents he wished to rely on, with Kailash Lawyers then having an opportunity to respond.

12. The further evidence included three judicial review applications Mr Patial has made in the Federal Court; a motion on foot in the proceedings before Goodman J and the letter of the Registrar of the Federal Court, refusing to accept applications which Mr Patial wishes to pursue in that Court, that decision being the subject of one of his judicial review applications. The others concerning decisions of the Fair Work Commission.

13. It should be noted that in his submissions he complained about claimed “procedural impropriety”, reference having been made in earlier oral submissions to judgments of the Federal Court, which had not been referred to in written submissions.

14. Nothing can come of this. The citations were provided in response to questions which I asked at the hearing and would otherwise have been available to the Court to consider, given the cases which the parties respectively advanced about their motions. Their provision to me involved no “ambush tactic” or any procedural unfairness.

15. It is also convenient to note that Mr Patial’s further written submissions addressed “key points” which he wished to make about problems he considered existed in relation to the proceedings in the Fair Work Commission, which concerned matters which Mr Patial will no doubt advance in his judicial review applications. Including in relation to claimed deceptive statements Mr Pall had made to the Law Society about his employment status and the drafting of the 2019 agreement and the jurisdiction clause it contained.

16. These submissions did not all support the case he pursued, but underscored the conclusions which I have reached about the motions.

Mr Patial’s motion

17. I am satisfied that the orders Mr Patial sought cannot justly be made.

18. There is no issue that the defence was filed out of time, not having been filed within the required 28 days, despite a notice of appearance having been filed in August 2024: r 14.3 UCPR. Or that Mr Patial had filed his motion without prior notice to Kailash Lawyers.

19. But leave to file the defence out of time was then given by the Registrar on 16 September, as r 14.3 of the UCPR permitted. The defence was filed in accordance with that order.

20. No review of the Registrar’s decision was sought. But still Mr Patial contended that the Court should exercise its power to strike out the defence: r 14.28 UCPR.

21. By his September motion, supported by Mr Patial’s affidavit, he also sought an order for judgment against Kailash Lawyers “for damages as referred to in the statement of claim to be assessed”. The affidavit referred to the notice of appearance filed for Kailash Lawyers and no defence having been filed, but it did not refer to the leave to file the defence which had been granted by the Registrar.

22. Mr Patial still contended not only that the defence was filed without leave and in breach of the applicable rules, but that it was misleading and vexatious, contained false denials of key facts as well as non-admissions contradicted by documentary evidence and prior admissions. The delay in its filing, combined with it being a misleading and vexatious defence, which had prejudiced his ability to resolve the matter efficiently, was also relied on.

23. Mr Patial also claimed that the transfer application involved a calculated and improper delay to the resolution of these proceedings, diverting the Court’s attention from the substantive issues arising from Kailash Lawyers’ procedural default and failure to comply with applicable Rules.

24. Mr Patial’s case included that what was raised by the defence unfairly prejudiced him. But this cannot be accepted, given the litigious history I will explain. Certainly, Mr Patial has not been taken by any surprise by what the defence pleads.

25. The Court’s strike out power can be exercised when it is apparent that a defence is doomed to fail, but that requires satisfaction about the General Steel Test: General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69. This was also not addressed by Mr Patial. Given all the decisions he is already bound by, that this test could conceivably be satisfied, may not be accepted. It requiring that the strike out power not be exercised, if there is a real issue of fact or law raised by the defence.

26. By its defence Kailash Lawyers does not admit or denies much of what Mr Patial has claimed, including his claimed employment. It relies on the terms of the 2019 written agreement; that Mr Pall supervised Mr Patial’s legal training pursuant to its terms; and that it was terminated by an email sent to him in August 2020. It also pleads that under that agreement it retained 60% of the fees he had generated, in return for the provision of legal training and other resources.

27. It follows that this defence again advanced matters which the parties had already litigated in the Fair Work Commission and the Federal Court.

28. It also follows that it cannot be accepted that in these proceedings, Mr Patial does not seek to pursue claims which he also pursues in the Federal Court. There is certainly significant overlap between his amended statement of claim and what he has to date unsuccessfully advanced in the Fair Work Commission, in the Federal Court and in the High Court.

29. Not only does Mr Patial again pursue claims based on his claimed employment by Kailash Lawyers. He also contends that the 2019 agreement was a sham, that it was unfair for reasons including claimed breaches of the Legal Profession Uniform Law (NSW), that he was owed a duty of care, that it had been breached and that he is entitled to an order for damages for various alleged wrongdoing by Kailash Lawyers.

30. The power to strike out pleadings is provided in r 14.28 of the UCPR. It may be exercised when no reasonable defence is disclosed, or where a pleading has a tendency to cause prejudice, embarrassment or delay, or is otherwise an abuse of process.

31. Despite the case Mr Patial advanced, I am not satisfied that the defence falls into any of these categories, given how what it pleads accords with decisions of the Fair Work Commission and the Federal Court which already bind the parties. Mr Patial’s attack on the defence does not accord with those decisions. It having already been concluded that despite the documents he again seeks to rely on, he was not an employee of Kailash Lawyers and that it would be an abuse of process for him to contend otherwise.

32. It can also not be accepted that an abuse of process is established by a defendant’s failure to comply with the Rules, when a defence is filed some 17 days after the 28 days provided by r 14, after a notice of appearance has been filed.

33. Mr Patial relied on the definition of “default” in r 16.2(1), which includes a defendant failing to file a defence within the 28 days prescribed by r 14.3(1) or such further time as the Court allows. Given the short delay in the filing of the defence in this case and how that was dealt with by the Registrar, exercising powers granted by the Rules to allow the defence to be filed, it cannot be concluded that Kailash Lawyers was relevantly in default.

34. In all those circumstances, I am satisfied that justice precludes the defence now being struck out, or the making of the other orders Mr Patial pursues.

35. It is relevant to that conclusion that the authorities have long warned practitioners about ‘snapping on’ a default notice without warning, when a defence has not been filed within time, which can unnecessarily increase the costs of litigation: Bushby v McKenzie (1991) 19 SR (NSW) 104. This is such a case.

36. Once leave to file the defence was given, Mr Patial ought not to have pursued his motion as he did, given the obligations imposed on parties by s 56 of the Civil Procedure Act*.* Namely*,* to assist the Court to facilitate the overriding purpose there specified, the just, quick and cheap resolution of the real issues in the proceedings.

37. The defence having been filed in accordance with leave given by the Registrar, the result was that Kailash Lawyers was no longer in default: r 16.2(2)(c) UCPR discussed in Gemma Constantinidis v Maxwell William Prentice in his capacity as trustee for the Estate of George Constantinidis [2023] NSWSC 128 at [54].

38. Given not only how Kailash Lawyers seeks to defend Mr Patial’s claims, relying on decisions which bind the parties, but that he has already filed a reply to that defence, I am well satisfied that the defence cannot justly now be struck out, or default judgment entered, as Mr Patial pressed.

39. While delay which precludes proceedings being fairly determined can establish an abuse of process, the short delay which Mr Patial relies on cannot fall into that category. Especially given the parties’ litigious history and the decisions by which they are bound. Mr Patial’s reply and the affidavits he has already sworn establish that he is well able to advance his evidentiary case about the matters in issue in these proceedings, despite that delay.

40. As a result Mr Patial’s motion must be dismissed.

The transfer motion

41. The transfer motion is pursued in light of all the proceedings Mr Patial has brought in various courts and the Fair Work Commission having arisen out of the same factual stratum. The case advanced being that it would accord with the requirements of s 56 of the Civil Procedure Act*,* for all of Mr Patial’s current claims to be dealt with by the one Court.

42. This is resisted by Mr Patial who argued that the transfer application was manifestly without merit, devoid of any factual or legal foundation and involved a misuse of the Court’s processes. In any event, he claimed that the Federal Court did not have jurisdiction to entertain the State proceedings. Mr Patial also relied on matters such as:

43. The fact that Mr Pall is not a party to these proceedings and Kailash Lawyers not a party to the District Court proceedings, with the result that it could not seek a transfer of those proceedings to this Court under s 140 of the Civil Procedure Act;

44. This Court not having the power to make the transfer orders sought under the Cross-vesting Act;

45. The differing relief he pursues in the Federal and State proceedings, which, as a result were not related;

46. The agreed jurisdiction clause in the 2019 agreement;

47. The Federal Court not having power to make all of the orders which he pursues in the State proceedings;

48. The just, quick and cheap resolution of the real issue in the proceedings not supporting the referral; and

49. The transfer motion involving an abuse of process.

50. The latter can immediately be dealt with. I am well satisfied that the transfer motion involved no abuse given what it raised for consideration and how I have concluded what is otherwise in issue must be resolved.

51. Mr Patial also argued that the defendants were seeking to leverage his self-represented status by “increasing procedural complexity and costs”.

52. But it must be noted that it is Mr Patial who is legally trained, who has not accepted that he is not entitled in the State proceedings to further pursue his claimed employment, despite decisions to the contrary, by which he is bound.

53. That has already resulted in his statement of claim in the Federal Court being struck out and he not being given leave to file his amended statement of claim, in which he continued to pursue that claim: Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2022] FCA 662. The appeal from that decision was dismissed: Patial v Kailash Lawyers Pty Ltd t/as Kailash Lawyers and Consultants [2023] FCAFC 155.

54. The further documents which Mr Patial tendered after the hearing established that in his current judicial review proceedings in the Federal Court he pursues orders in relation to the Fair Work Commission decisions which established that he had not been an employee. Presently he remains bound by those decisions.

55. That Mr Patial still does not accept that he is not entitled to further pursue his claimed employment is in my view not a proper basis for this Court refusing to make the transfer order, if it is otherwise warranted.

56. If Mr Patial’s judicial review applications succeed in the Federal Court, all that he wishes to pursue as the result of his claimed employment and Kailash Lawyers’ variously alleged failures will then be before the one Court, which can conveniently deal with all that lies between the parties about his many and varied claims.

57. It is for a plaintiff to take the necessary steps to plead an available claim in accordance with the requirements of the Rules which bind all parties to the particular proceedings. It is not an abuse for a defendant to resist such a claim by pursuing its rights under those Rules. If the plaintiff does not advance an available pleading, as Kailash Lawyers has established in the Federal Court Mr Patial has not, it cannot justly be criticised in these proceedings. That is because the parties are bound by the decisions of that Court.

The course Mr Patial has pursued

51. Nor can it be accepted, given the parties’ litigious history, that what is before this Court establishes that by their transfer motion the defendants have merely been pursuing tactical delays, as Mr Patial also complained.

52. In the Fair Work Commission McKenna C concluded in August 2021 that despite what Mr Pall had said in the documents Mr Patial relied on and now seeks again to pursue in the State proceedings, he was not an employee of Kailash Lawyers: Patial v Kaila**sh Lawyers Ltd [2021] FWC 4167. The parties also remain bound by that decision, Mr Patial’s application for permission to pursue an appeal, required under s 604 of the Fair Work Act 2009 (Cth), having been refused by a Full Bench of the Commission in 2022: Patial v Kaila**sh Lawyers Ltd [2021] FWCFB 6055.

53. I note that Mr Patial complained about the submissions which were made at the hearing about these and other decisions. But given that he was a party to the proceedings, he cannot have been taken by surprise when reliance was placed on those decisions. He has certainly had a fair opportunity to advance his submissions about them, with the result that his complaints can lead nowhere.

54. Despite the passage of time Mr Patial claimed at the hearing that he still intended to challenge the Fair Work Commission decisions in the Federal Court. There was no explanation for his delay, despite his reliance on the Registrar’s refusal of his filing of a statement of claim in August 2024, when he sought to pursue alleged breaches of the 2019 agreement in the Federal Court, which the Registrar of that Court considered it did not have jurisdiction to entertain. That is being challenged by one of his judicial review applications.

55. It would thus appear that the transfer of the State proceedings to the Federal Court would achieve Mr Patial’s aim of having that Court consider claims of the kind he pursues in the State proceedings, but still he resisted the transfer.

56. The judicial review applications which he explained by his further written submissions he had brought only in 2025, explain the course he now seeks to pursue in the Federal Court, in order to challenge the Fair Work Commission decisions. There he seeks to pursue claimed errors of law, jurisdictional errors and denial of procedural fairness, to advance his case that he was an employee of Kailash Lawyers.

57. In my view the initiation of those further proceedings support the transfer which Mr Patial resists.

58. In 2021 Mr Patial had already brought Federal Court proceedings against Kailash Lawyers and two other companies of which Mr Pall is a director. They are still on foot although no defence has yet been filed. There Mr Patial sought relief under the Fair Work Act 2009 (Cth) and the Superannuation (Administration) Act 1992 (Cth), for payments he claimed were still due to him, including remuneration, superannuation and annual leave. He also pursued other claims, including in respect of alleged discrimination, harassment and psychological stress.

59. Mr Patial’s statement of claim was struck out by Goodman J in 2022, much of it depending as it did on his still claimed employment, the re-litigation of which was found to be contrary to the principle of finality, creating the possibility of inconsistent judgments on the same issue, which would involve an inefficient use of court resources and bring the administration of justice into disrepute: Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2022] FCA 662 at [42].

60. Similar difficulties appear to be raised by the claims Mr Patial pursues in these and the District Court proceedings.

61. However, the Federal Court proceedings were not summarily dismissed as an abuse of process. That was because of Mr Patial’s non employment claims, in respect of which he was given leave to replead: at [57].

62. Mr Patial was also given leave to replead allegations which he had advanced against Koala Investment Property Pty Ltd and Kuber Investment Group Pty Ltd, in relation to payment of claimed additional work, various expenses and claimed psychological stress: at [58]-[60].

63. Mr Patial’s appeal against that decision was refused in March 2023: Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2023] FCAFC 155.

64. In its 2023 decision, the Full Federal Court noted that the structure of Mr Patial’s statement of claim had been found by Goodman J to have created an impression that his substantive claims principally concerned an employment relationship between he and Kailash Lawyers: at [13]-[14]. It concluded that Mr Patial had not engaged in any substantive way in identifying an arguable claim, and that his pursuit of his claims based on the existence of an employment relationship did involve an abuse of process: at [29].

65. The Full Court also concluded that Mr Patial’s claimed employment had been litigated and resolved in the Fair Work Commission and that he had not been permitted to further litigate that in the Federal Court, because it would involve an abuse of process, his claims depending on the essential fact of whether or not he could prove the claimed employment: at [31].

66. While ss 725 and 729 of the Fair Work Act did not create a bar to Mr Patial bringing a claim in the Federal Court for unfair dismissal as an employee, in his pleadings he had repeatedly made scandalous allegations without any coherent basis. As well as arguing that the agreement he relied on was a sham, despite there not being any dispute about the payments which had been made to him under it. That agreement was on foot at a time when Mr Patial also ran his own migration agency and investment businesses and the evidence in the Commission having established that the parties had otherwise conducted themselves in accordance with the terms of their agreement, while it remained on foot: at [32]-[34].

67. As a result, the further pleading, despite the Commission’s finding that Mr Patial had not been employed but was instead a contractor, involved an abuse of the Federal Court’s processes: at [37]. There had thus been no error in the Goodman J’s conclusion that Mr Patial could not reagitate his claim that he had been an employee. Accordingly, his appeal was dismissed.

68. In the High Court in July 2023 Mr Patial was refused leave to issue or file a constitutional writ by which he sought orders about the decisions of the Fair Work Commission and Federal Court: In the matter of Patial [2023] HCATrans 095.

69. The relief which Mr Patial there pressed included orders quashing the Commission’s decisions, compelling it to remake the challenged decisions according to law and requiring the Federal Court to hear the matter. No basis for any of Mr Patial’s applications, which it was noted also made a variety of scandalous allegations, was found. Nor was any basis for the exercise of the High Court’s jurisdiction. Mr Patial’s claim for relief was found to be untenable and so his application was refused.

70. In those circumstances, it is difficult to see how Mr Patial is now entitled to pursue any claim in the State proceedings on the basis that he was an employee of Kailash Lawyers. Or how he can rely on documents which were in evidence in the Fair Work Commission, which were not accepted as establishing his claim that he was an employee. But that is the course he has continued to pursue, including now it appears, by the further judicial review proceedings he brought in the Federal Court in 2025.

71. It was in 2024 that Mr Patial brought these proceedings in this Court, as well as those he commenced in the District Court. In both he also seeks to pursue claims on the basis of his still claimed employment under what he still contends was a sham agreement. He also pursued his application in the Federal Court for leave to plead such claims, by his ongoing appeal against Goodman J’s further orders and his judicial review applications.

72. It was in March 2024 that Goodman J refused Mr Patial leave to file a proposed amended statement of claim in the Federal Court, in which he sought to add as respondents Mr Pall and Kailasam Holdings Pty Ltd: Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2024] FCA 179. His proposed amended statement of claim alleged that as a director, Mr Pall is liable for any amounts which the corporate defendants are liable to pay him: at [15].

73. Mr Patial was not given leave to replead those parts of his statement of claim which were based on the proposition that he was an employee of Kailash Lawyers, Goodman J concluding that the proposed allegations that he was such an employee involved an abuse of process: at [24]. This included the claim for payment for annual leave, which also depended on the claimed employment relationship: at [30].

74. Mr Patial also sought to plead not only that the agreement was a sham, but that Mr Pall, who was not a party to that agreement, had breached it. Despite also pleading that the parties had not intended the agreement to bind them. Leave to pursue moneys claimed to be outstanding under the claimed sham agreement was refused: at [28].

75. Leave to pursue other aspects of the amended statement of claim, including claims in respect of superannuation, discrimination, harassment, Mr Pall forcing a junior solicitor to be involved in wrong activities and other serious matters were all refused because the material facts had not been pleaded: at [33], [39], [43] and [44]. Leave in respect of the claim for psychological stress was also refused for ongoing pleading problems which had not been remedied: at [46].

76. Leave to pursue claims about Mr Pall having manipulated Mr Patial to enter the sham agreement was also refused, given the contradictory claims he advanced about the agreement, which resulted in the conclusion that the proposed pleading was embarrassing: at [50]. Further, material facts in relation to claimed breaches of various provisions of the Fair Work Act having been contravened by Mr Pall and Kailasam Holdings also not having been pleaded, leave in respect of those claims was also refused: at [51]. As was an insufficiently pleaded claim in negligence arising from alleged breaches of a duty of care owed to Mr Patial by Mr Pall and the corporate defendants: at [52].

77. Mr Patial appealed this decision. Leave to appeal was refused in February 2025: Patial v Kailash Lawyers Pty Ltd trading as Kailash Lawyers and Consultants [2025] FCA 113, Mr Patial having failed to identify any error in Goodman J’s decision: at [4]-[5]. Bromley J also concluded that nearly all the points Mr Patial pursued about Goodman J’s alleged apprehended bias, which had not been raised before him, were at the trivial end of the spectrum and even if they met the first limb of the two limbed test in Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63 at [8], they could not possibly have passed the second limb: at [7]-[8]. His Honour concluded that the appeal was completely hopeless, doomed and should never have been brought: at [10].

78. Mr Patial had commenced these proceedings in August 2024 against Kailash Lawyers. He pursues the review of claimed unfair clauses contained in the 2019 agreement; while also claiming that it was not a valid workplace instrument for supervised legal training under the Legal Profession Uniform Law (NSW) or approved by the Law Society. He seeks orders setting the agreement aside, compensation for alleged professional negligence and breach of a duty of care which he claims he was owed by Kailash Lawyers.

79. Mr Pall is also not a party to these proceedings. But he is a party to the District Court proceedings which Mr Patial also commenced in August 2024. There he pursues compensation from Mr Pall for breach of a duty of care which he again claims Mr Pall also owed him, as well as other relief. Kailash Lawyers is not a party to those proceedings.

80. But it must be accepted that many of the claims which he advances in the State proceedings advance the same or similar claims to those which he pursues in the proceedings on foot in the Federal Court. They all arise out of the same substratum of facts. It is in that Court that the question of his claimed employment will finally be considered and resolved, given the judicial review proceedings which he also pursues there.

Transfer from the District Court

81. I am satisfied that the Court does have power to make all the transfer orders Kailash Lawyers pressed, even though Mr Pall is not a party to these proceedings and Kailash Lawyers is not a party to the District Court proceedings.

82. Mr Pall is the controlling mind of Kailash Lawyers and while it cannot be overlooked that it is a separate legal entity, there can sensibly be no question that he is aware of Kailash Lawyer’s application to transfer the District Court proceedings to this Court and then to the Federal Court, together with these proceedings, in order that the two State proceedings can be heard by that Court. Further, it must be accepted that Mr Pall does not oppose such orders being made, not having sought to be heard to oppose the transfer.

83. While under s 140 of the Civil Procedure Act it is only a party to proceedings in the District Court who can seek an order for transfer of proceedings to this Court, the section also permits the Court itself to make such an order, acting of its own motion.

84. The exercise of that power is discretionary, requiring the relevant facts to be considered and good reason for the transfer to be established. Its exercise must be approached in light of the requirements of s 56 of the Civil Procedure Act: see CHP Asset Management Pty Limited v Maison Global Property Pty Limited [2023] NSWSC 992. Section 56 requiring the Court to exercise its powers to facilitate the overriding purpose there specified, the just, quick and cheap resolution of the real issues in the proceedings,

85. It has long been considered that the possibility of inconsistent findings of fact and law, either as between two lower courts or as between a lower and this Court, warrants the transfer of pending lower court proceedings into this Court: Ritchie v Gumley (1954) SR (NSW) 334; Re Murray; Ex parte Hillman [1961] NSWR 573.

86. In all of the circumstances here arising for consideration, I am well satisfied that justice requires the exercise of the Court’s power, acting of its own motion, to order the transfer of the District Court proceedings to this Court, so that even if they were not transferred to the Federal Court, all that Mr Patial pursues could be dealt with by the one State Court.

87. Given all that Mr Patial seeks to pursue in the two State proceedings, especially when considered in light of the litigious path he has already pursued and continues to pursue, justice cannot permit any other conclusion. The course he has pursued in State courts is not explained either by the claimed complexity of his claims, or his pursuit of different defendants. Nor does it appear to accord with the obligations which s 56 imposes upon him.

88. Mr Patial also did not dispute that a transfer order could also be made under s 8 of the Cross Vesting Act. Accordingly, there can be no question about the Court’s power to order the transfer of the District Court proceedings to this Court.

89. Even if I had come to the conclusion that the State proceedings should not be transferred to the Federal Court, in the circumstances I have explained, I would still have ordered the transfer of the District Court proceedings to this Court. Why Mr Patial did not pursue all of his claims against Kailash Lawyers and Mr Pall in these same proceedings, given that they all arise out of entirely the same facts, is simply not apparent.

90. Mr Patial’s resistance of the transfer of the District Court proceedings to which Mr Pall is a party to this Court has no basis in logic or justice. The separate proceedings in this State risking, as they do, not only inconsistent judgments being given about the same facts by two courts, but also unnecessary additional costs and wasted court resources.

91. Adherence to the requirements of s 56 of the C**ivil Procedure Act simply does not permit the risk of that outcome.

Transfer from this Court to the Federal Court.

92. I am also satisfied that the same considerations drive the conclusion that the State proceedings must be referred to the Federal Court. The judicial review proceedings Mr Patial has recently commenced in that Court only reinforces that conclusion.

The jurisdiction clause

93. That conclusion is not precluded by the jurisdiction clause in the 2019 agreement. It provides as to jurisdiction “This agreement is governed by the laws of New South Wales and the parties submit to the non-exclusive jurisdiction of the courts of that state.”

94. In his further written submissions Mr Patial contended that it was unprecedented for Kailash Lawyers to seek to circumvent or challenge the jurisdiction clause it had itself drafted, by disavowing or opposing its own clause. Further, that the situation was extraordinary, it rejecting the very clause it had drafted to protect its legal position.

95. This may not be accepted.

96. The agreed jurisdiction clause does not provide that this Court has exclusive jurisdiction. To the contrary, it expressly provides for non-exclusive jurisdiction. Nor does it prevent a transfer order being made, if that is what justice requires; Joshan v Pizza Pan Group Pty Ltd (2021) 106 NSWLR 104; [2021] NSWCA 219.

97. Mr Patial relied on Akai Pty Ltd v People's Insurance Co Ltd (1996) 188 CLR 418; [1996] HCA 39. But it was concerned with provisions of an insurance policy which specified that it was governed by the Laws of England and that any dispute “shall be referred” to its courts. The 2019 agreement made no such provision and does not assist Mr Patial’s case.

98. If the Federal Court has power to entertain the claims Mr Patial pursues in the State proceedings, the 2019 agreement thus does not preclude their transfer to that Court.

The Federal Court’s power

99. I am also satisfied that the Federal Court will have the power to deal with all of Mr Patial’s claims, if the State proceedings are transferred to it.

100. This flows from what was decided in Re Wakim 198 CLR 511; [1999] HCA 27 about how a justiciable controversy is to be ascertained from pleadings and the factual basis of the claims advanced. Given what Mr Patial seeks to pursue in the State proceedings and the common factual basis out of which they and all of the proceedings he pursues in the Federal Court all arise, it follows that if the State proceedings are referred to the Federal Court, it will have power to deal with the entirety of the justiciable controversy which Mr Patial seeks to pursue.

101. That is because where different claims arise out of a common substratum of facts, as they do here, the jurisdiction of the Federal Court is not restricted to the determination of the federal claim or cause of action which arises. The Federal Court’s power extending to the litigious or justiciable controversy between the parties of which the federal claim or cause of action forms part: Re Wakim at [135].

102. The nature of that controversy is not determined by the proceedings which the parties commence, but depends on what they have done, their relationship and the rights or liabilities which attach to their conduct and relationship: Re Wakim at [135] quoting Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261; [1983] HCA 36. One court dealing with an entire controversy being desirable, because often, if proceedings were tried in different courts, there could be conflicting findings made on one or more issues, this fact helping to indicate that there is in reality a single matter: in Re Wakim at [141].

103. This is such a case.

104. It is relevant that the pleaded defence which Mr Patial sought to have struck out in these proceedings reflected conclusions already reached by both the Fair Work Commission and the Federal Court, which already bind the parties. Neither Mr Patial’s claims in the State proceedings, nor his attack on the defence accords with them even though he is bound by them.

105. Despite Mr Patial seeking to have Mr Pall joined as a party to the Federal Court proceedings and pursuing in the Federal Court not only his appeal in relation to a statement of claim which duplicates aspects of those he has filed in these proceedings and in the District Court, but also the three judicial review proceedings Mr Patial has also recently commenced, he still contends that the Federal Court would not have power to deal with all of his claims, if the transfers sought were ordered.

106. That cannot be accepted. There are some circumstances in which a transfer may not be ordered. For example where the approval of an agreement by this Court is by statute made a condition precedent to its efficacy: Smith v Smith (No 3) (1986) 161 CLR 217; [1986] HCA 36 and Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559; [2001] HCA 1 at [59], [138] discussed in Valceski v Valceski [2007] NSWSC 440 at [43].

107. I cannot see that this is such a case. As Brereton J explained in Valceski at [47], the scope of the Federal Court’s “accrued jurisdiction depends upon the scope of the single justiciable controversy. If the same substratum of facts gives rise to a wide range of disputes, some federal and some not, they are all within the accrued jurisdiction.”

108. That there is in reality a single controversy lying between these parties, out of which all of Mr Patial’s various claims spring, explains his attempted joinder of Mr Pall to the Federal Court proceedings still on foot before Goodman J. His joinder was not opposed on the basis that the Court did not have power to deal with the claims Mr Patial wished to pursue. They including claims about the 2019 agreement, Mr Pall’s supervision of Mr Patial’s legal training, inaccurate information it is claimed he provided to the Law Society and the agreement being contrary to provisions of the Legal Profession Uniform Law.

109. Mr Patial also now seeks to pursue his claimed employment by his judicial review applications.

110. In my view Mr Patial’s similarly pleaded claims in the State proceedings thus preclude the conclusion that what he pursues in the courts of this State does not arise out of a common substratum of facts and do not all form a part of the litigious or justiciable controversy between he, Kailash Lawyers and Mr Pall.

111. In all of those circumstances, I am satisfied that the Federal Court will have power to deal with the wide range of disputed claims Mr Patial pursues in the State proceedings, if they are referred to it.

112. That Mr Patial’s claims include alleged breaches of the ethical or professional obligations which solicitors and barristers have as officers of this Court cannot, in my view, result in any other conclusion. They too, arising as they do out of the same justiciable controversy as his other claims.

113. Mr Patial pointed to no authority which supported his submissions, which I am satisfied cannot be accepted, given the authorities which I have referred to. Nor did he explain what aspect of the Legal Profession Uniform Law (NSW) supported his case. Had he done so, that may have given rise to questions of statutory construction. But no such case having been advanced, it is unnecessary to consider its provisions in resolving the matters over which the parties did join issue.

Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW)

114. The proceedings before Goodman J are due to be relisted in April. While Kailash Lawyers raised the possibility of deferring the making of the orders sought until after that listing, given that the judicial review proceedings are also on foot in the Federal Court, there seems to me to be no good reason for any delay.

115. I also being satisfied that on the proper construction of s 5(1) of the Cross-Vesting Act, there being proceedings on foot in this Court as well as in the Federal Court which arise out of the same justiciable controversy between these parties, of which the various proceedings currently on foot in all three courts all form a part, that the Court does have the power to make the referral sought, if it concludes that to be in the interests of justice.

116. That was what Slattery J concluded in Zhang v Levingston [2023] NSWSC 1559 at [26]-[30], correctly in my view for the reasons there explained, which it is unnecessary to explain further. Similar conclusions were arrived at in Sultan v Dabboussi [2024] NSWSC 683 at [13].

117. Whether the disputed referral should be ordered depends on what the interests of justice require, that raising for consideration questions of case management: BHP Billiton Ltd v Schultz (2004) 221 CLR 400; [2004] HCA 61. That does not turn on the interests Which one party or the other may perceive. Often they will conflict.

118. Here, Mr Patial pursues entitlements he claims arose out of the 2019 agreement under which he received legal training which Mr Pall supervised. During which he claims he was subjected to various wrongdoing, despite the duties of care he was owed and statutory obligations which attached to such legal training.

119. Mr Patial’s claims are contradictory, including on the one hand, that the agreement was not only a sham and unfair and so must be set aside. But on the other, that it was breached in various ways. He pursues not only claimed entitlements to payments which depend on his claim that he was an employee being accepted, but also damages for various alleged wrongdoing, ultimately by Mr Pall, he being Kailash Lawyer’s controlling mind.

120. The three Courts in which and the parties against whom Mr Patial has advanced his variously pleaded claims for similar relief for various entitlements and damages are not determinative of the question of what the interests of justice require, or what case management considerations dictate. These questions must now be approached in light of the requirements of s 56 of the Civil Procedure Act, the just, quick and cheap resolution of the real issues in the proceedings.

121. Contrary to Mr Patial’s submissions, I am satisfied that those requirements support the conclusion that the transfer which he opposes must be ordered.

122. I am well satisfied that the interests of justice require that the two State proceedings now be referred to the Federal Court given:

123. The decisions and judgments which already bind these parties;

124. That having commenced proceedings in this State in which Mr Patial continues to pursue his claimed employment despite these decisions, he still opposed the transfer of the Federal Court proceedings to this Court, for no sound reasons;

125. Mr Patial maintained that position being despite having also commenced judicial review proceedings in the Federal Court by which he also seeks to establish the claimed employment on which his claims in the State proceedings depend; and

126. The significant risk that Mr Patial’s current course could result in three Courts at trial making different findings about the same facts and coming to different conclusions about the same or similar legal claims which he pursues.

127. I do not accept that the transfer order would unfairly burden Mr Patial, without discernible benefit to the administration of justice, as he argued. To the contrary, it can only minimise costs and the time required for the hearing of the various proceedings which he pursues against Mr Pall and the companies of which he is a director, all brought as the result of the same agreement and dealings with each other.

128. In those circumstances, to refuse to order the transfer would potentially permit an abuse of process. Justice simply does not permit Mr Patial to pursue his variously pleaded claims in a number of different proceedings, before different courts, as he is intent on. Nor can he seek to evade the consequences of decisions of the Fair Work Commission and the Federal Court which he does not accept, by the pursuit of the further proceedings he has commenced in the State courts.

129. The transfer order will thus permit the Federal Court to case manage all that arises to be determined about the claims which Mr Patial is entitled to pursue about the justiciable controversy which is established by the parties’ pleadings in the various proceedings he has commenced, given the facts out of which they all arise.

130. Cost savings and other efficiencies will be achieved if the same witnesses do not have to give evidence about the same matters in three different courts in various proceedings which are on foot, as well as by the same or similar legal arguments not having to be repeatedly considered and resolved. That neither the proceedings in this or the District Court are far advanced and no costs orders have yet been made, also supports the making of the transfer order.

131. Mr Patial has yet to obtain leave to proceed on his amended statement of claim in the Federal Court, or to establish that he was an employee, as he still claims. But it has already repeatedly dealt with fundamental issues also lying between the parties in these proceedings and in his judicial review applications. Namely, whether he is still entitled to pursue the claims that he again seeks to pursue in these proceedings, on the basis that despite the 2019 agreement, he was in truth an employee.

132. I am well satisfied that this makes the conclusion that the Federal Court is the appropriate Court to hear the entirety of the controversy lying between these parties unavoidable.

133. It follows that this is a convenient time for the proceedings which Mr Patial has commenced in the two State courts to be transferred to the Federal Court. That being the course which will best facilitate the overriding purpose of the Civil Procedure Act, the just, quick and cheap resolution of the real issues in the proceedings.

Costs

130. The usual costs order under the Uniform Civil Procedure Rules is that costs follow the event: r 42.1. That would be an order that Mr Patial bear the defence costs.

131. But costs were sought on an indemnity basis for the default judgment motion, payable forthwith, Mr Patial not having withdrawn that motion as he ought to have, despite being on notice that his claims would be defended. Even after leave to file the defence was given, in circumstances which meant that his motion was doomed to fail.

132. Mr Patial did not address those submissions, but I take him to oppose them.

133. Still I am satisfied that consistent with the obligations imposed on the parties by s 56, as I explained, Mr Patial ought not to have pursued his motion. That is because it was unarguably doomed to fail, given the course which the proceedings had taken and the provision which the Rules make as to default, once a defence is filed as it was with leave, as I earlier explained.

134. In those circumstances I am satisfied that justice does require that costs of Mr Patial’s motion be ordered on an indemnity basis.

135. The exercise of that power typically depends on misconduct in the proceedings being established: Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 at [69]. Indemnity costs can be ordered to compensate the successful party where it was unreasonable for the unsuccessful party to have subjected the successful party to the costs incurred and where there was relevant delinquency: Cabport Pty Ltd v Marinchek (No 2) [2013] NSWCA 131 at [6].

136. Given all that I earlier explained, I am satisfied that this is such a case. Mr Patial having pursued his motion as he did despite what the Rules provided and the leave the Registrar gave to file the defence. But I am not satisfied that a basis has been established for those costs to be payable forthwith. Nothing advanced was addressed to this issue or established a proper basis for such an order.

137. Given the conclusions I have reached about the transfer of the State proceedings to the Federal Court, I am satisfied that Mr Patial must bear the costs of the transfer motion on which Kailash Lawyers also succeeded, on the usual basis.

Order

138. For these reasons I order that:

139. Mr Patial’s motion be dismissed with an order that he pay Kailash Lawyers’ costs of that motion on an indemnity basis.

140. Mr Patial also pay the costs of Kailash Lawyers’ motion, as agreed or assessed.

141. Pursuant to s 140 of the Civil Procedure Act the District Court proceedings be transferred to this Court.

142. Pursuant to s 5(1) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW) both these proceedings, no 2024/00283199, and the District Court proceedings, no 2024/00286813, be transferred to the Federal Court with a view to being heard and determined together with matter no NSD1016/2021 in that Court.

143. The listing before the Registrar on 11 April 2025 be vacated.

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