Plaintiff v Defendants

(b) Orders for substituted service upon the 14th and 17th Defendants pursuant to r 6.10 of Ch 1 of the Supreme Court (General Civil Procedure) Rules 2015.

(1) A writ or an originating motion shall be valid for service for one year after the day it is filed.

(2) Where a writ or originating motion has not been served on a defendant, the Court may, from time to time, by order extend the period of validity for such period from the day of the order as the Court directs, being not more than one year from that day.

(3) An order may be made under paragraph (2) before or after expiry.

(4) The plaintiff may apply under paragraph (2) without notice to the defendant, but if the Court considers that the defendant ought to be heard, the Court shall -

(a) adjourn the further hearing; and

(b) direct the plaintiff to give notice to the defendant by summons or otherwise.

(1) Where for any reason it is impracticable to serve a document in the manner required by these Rules, the Court may order that, instead of service, such steps be taken as the Court specifies for the purpose of bringing the document to the notice of the person to be served.

...

4 The writ with a general endorsement of claim was filed on 19 December 2013. There are 19 defendants most of whom are non-Australian based or non-Australian incorporated.

5 The statement of claim was filed on 10 February 2015. In summary and simply put, the claim is framed as follows:

(a) The proceeding concerned the acquisition of Rail Car Portfolios in North America;

(b) The plaintiff invested in the second defendant as a vehicle for investing in transactions originated and promoted by Babcock & Brown Group, a global investment and advisory group;

(c) The second defendant was to acquire a special purpose liability company ('BBRX Five LLC') to purchase the rail car stock (the BBRX Five transaction) (I will not refer to the nuances or the totality of the transactions involved);

(d) To assist in financing the acquisition, a loan was entered into by obtaining by the second and fourth defendants a mezzanine debt facility from Everest Capital as Trustee for two named trusts;

(e) There was also an interest rate swap agreement entered into with Bear Sterns ('Interest Rate Swap');

(f) The Interest Rate Swap was novated to the ANZ Bank, the underwriter of the senior debt being advanced in connection with the BBRX Five transaction;

(g) It was a term of the ANZ loan that the Interest Rate Swap be supported by additional collateral ('the Collateralisation Obligation');

(h) BBRX Five LLC defaulted on the Collateralisation Obligation;

(i) Its secured lendors subsequently foreclosed on the rail cars and sold them for an amount less than the total debts of BBRX Five LLC;

(j) Other subsidiaries of the second defendant subsequently defaulted on their debt facilities;

(k) The second defendant became insolvent and as a result of the various defaults, it was subsequently deregistered; and

(l) The plaintiff's investment in the second defendant was totally lost.

6 It is alleged that various representations were made by various groups of defendants including what are defined as the 'advisor defendants'. The advisor defendants include the 11th, 12th, 13th, 14th, 15th, 16th and 17th defendants.

7 It is alleged that the representations induced the 10th defendant to subscribe for an equity interest in the second defendant on behalf of the plaintiff.

8 It is contended that the advisor defendants, along with Ross Sullivan, were employees or agents of B & B Group seconded to BBGIM (the 10th defendant) and were responsible for providing investment and advisory services in relation to the proposed investment in the rail car portfolio.

9 BBGIM issued a Capital Approval Request dated 14 December 2007 ('CAR'). The statement of claim contends that:

Each of the Advisor Defendants were members of the core deal team, acting on behalf of BBGIM advising the plaintiff in relation to the BBRX Five transaction. It is alleged that the Advisor Defendants and Ross Sullivan prepared this CAR on behalf of BBGIM and submitted it to the plaintiff which:

(a) made the representations;

(b) recommended that the plaintiff make the investment; and

(c) contained the material omission defined in the statement of claim.

10 Various breaches were pleaded against BBGIM and the advisor defendants. Those were breaches of the management agreements, breach of duty and breach of fiduciary duty. The express and implied terms of the management agreement breaches as set out at paragraph 71 and at paragraph 72 it is pleaded:

Each of the Advisor Defendants and Global knew:

(a) the plaintiff was a mutual fund company;

(b) that under the terms of the management agreements, [the plaintiff] could only make a decision in relation to a new investment based on the recommendation made by BBGIM [clause 3.5(c) and (d)];

(c) that BBGIM was assuming responsibility for investing all of the assets of the [plaintiff];

(d) [the prospectus representations set out in paragraph 3 of the statement of claim];

(e) that the plaintiff relied entirely on BBGIM for the proper management and investment of its assets; and

(f) the plaintiff would suffer loss and economic harm if BBGIM failed to provide its services with reasonable care and skill.

11 Apart from the characterisation in paragraph 5 of the statement of claim of the 14th and 17th defendants (along with others) being employees or agents of B & B Group seconded to BBGIM, there is no attempt to define the roles of the 14th and 17th defendants or their actual role in making any of the representations, participating in any of the conduct and participating in any of the breaches complained of.

12 On 19 December 2013 the plaintiff filed the generally endorsed writ.

13 Between 2 December and 16 December 2014 (almost at the expiration of the writ), the plaintiff served the 10th, 11th, 12th, 13th and 16th defendants. With the exception of the 10th defendant, each of those defendants has entered appearances and served a defence.

14 The plaintiff has narrowed the claim to eight defendants. The plaintiff has not and will not serve the first to ninth defendants.

15 On 17 December 2014 the plaintiff filed its summons for the application to extend the period of the validity of the writ.

16 On 27 January 2015 the plaintiff filed its summons seeking orders for substituted service.

17 The material relied upon by the plaintiff includes the following:

(a) The affidavit of Gregory John Whyte sworn 17 December 2014;

(b) The affidavit of Gregory John Whyte sworn 27 January 2015;

(c) The affidavit of Gregory John Whyte sworn 30 April 2015; and

(d) The affidavit of Lilian Rizio sworn 30 April 2015.

18 The 14th defendant has served an affidavit of Karen Elizabeth Coleman sworn 6 May 2015.

Attempts to serve the 14****th defendant (Peter Hocking)

19 On 4 December 2014 a process server attended 420 George Street, Sydney and was told by the receptionist that Mr Hocking was not in but a message would be passed on.

20 The process server again attended at 420 George Street, Sydney on Friday 5 December 2014 at 9:45am and spoke with a receptionist. She called Mr Hocking on the internal phone but he did not answer. A message was left. The receptionist advised that Hocking often worked from home.

21 On 9 December 2014, the process server attended at level 17, 420 George Street, Sydney (a level which had been previously advised as not being able to be reached) and was told by staff that: 'staff have been advised by the Defendant not to allow him access to the building and have told our agent not to call this address again'.

22 After expiry of the writ on 5 January 2015 an email transmission was sent to Mr Hocking at the addresses, 'phocking@statestreet.com' and 'peterhocking@ssga.com' informally serving him with the writ and a SEPA notice. On 14 January 2015 Mr Hocking acknowledged receiving the email and denied service had occurred.

23 On 3 February 2015, Mr Hocking's solicitors confirmed that they acted upon his behalf. On 4 February 2015 the plaintiff's solicitors received a letter from Mr Hocking's solicitors advising that they wished to be heard in relation to this application.

24 The plaintiff submits that it made all reasonable efforts to serve Mr Hocking during the period the writ was valid. Further, the plaintiff submits that the evidence (what I have set out in paragraph 19 to 21 hereof) indicates that the 14th defendant was aware of the attempted service and took clear steps to evade service.

25 An attempt was made on 1 December 2014 to serve Mr Juan at his last known address in Hong Kong. That attempt was unsuccessful.

26 On 9 December 2014, the plaintiff provided instructions to a process server to locate a possible address in New South Wales.

27 On 15 December 2014 the plaintiff instructed a process server to serve Mr Juan at Bossley Park, New South Wales.

28 On 18 December 2014 (being close to the last day of the validity of the writ for service) the process server attended at 23 Holbrook Street, Bossley, New South Wales on two occasions. The process server spoke with the occupant who identified himself as Mr Juan's father. Mr Juan's father told the process server that the defendant no longer resided at that address and he did not know where he lived or how to contact him.

29 After the expiration of the time for service of the writ the plaintiff established that Mr Juan owns property at 40/22-32 Great Western Highway, Parramatta, New South Wales. That property is managed by LJ Hooker. The report of the process server set out that LJ Hooker was able to pass on a document to Mr Juan if it were provided to it. On 9 March 2015, the plaintiff sent a letter to LJ Hooker Parramatta enclosing a letter serving the proceeding on Mr Juan.

30 Subsequently, on 11 March 2015, the plaintiff's solicitors received an email transmission from Ms Johnson of LJ Hooker Parramatta advising that it did not have instructions from Mr Juan to accept service on his behalf. Subsequently on the same day Mr Whyte was told by Ms Johnson that she had spoken to Mr Juan regarding the plaintiff's solicitors' letter and its contents.

31 The plaintiff submits that it made all reasonable efforts to serve Mr Juan and that as his whereabouts was unknown that was the 'best reason' to extend the validity of the writ to allow service upon Mr Juan.

32 On 2 December 2014 the plaintiff's solicitors instructed the process server to serve 'Mr Ellen' at 680 George Street, Sydney. The process server attended at that address on 4 December 2014 and was told there was no record of a 'Tim Ellen' working there. On 12 December 2014 the process server advised that despite extensive investigation they had been unable to locate an address for service.

33 After the expiry of the validity of the writ, the plaintiff's solicitors discovered that an error had been made in the spelling of Mr Ellem's surname which had been previously set out as 'Ellen' rather than 'Ellem'.

34 Mr Ellem's counsel has appeared upon this application.

35 Mr Whyte produced a service schedule which demonstrates that the 10th, 11th, 12th, 13th and 16th defendants were served between 4 December 2014 and 15 December 2014.

36 In his affidavit of 17 December 2014 Mr Whyte set out:

In the period from 19 December 2013 to December 2014, the Plaintiff has continued its investigations into the matters the subject of the claim for the purpose of preparing a statement of claim.

Those investigations concern matters about which claims to pursue and against which defendants. ...

37 The circumstances set out in paragraphs 4 and 5 of his affidavit form the basis to argue that reasonable attempts at service upon the 14th, 15th and 17th defendants had been carried out notwithstanding that those attempts did not commence until about two weeks before expiry of the writ.

38 It transpires that Mr Whyte's affidavit was not as elucidating as it might have been. Karen Coleman swore an affidavit on behalf of the 14th defendant. That affidavit produced, among other things, announcements made by the plaintiff to the Singapore Stock Exchange about the present proceedings. On 21 December 2013 the Board of Directors of the plaintiff announced that it had on 19 December 2013 filed writs in '(1) the Supreme Court of Victoria, Australia and (2) New York County, Supreme Court' against the defendants as named in this proceeding and set out a summary of the claim it had against them.

39 On 17 April 2014 the plaintiff made a further announcement in the following terms after referring to the 21 December 2013 announcement:

...wishes to announce that the Company will not be pursuing proceedings in the New York County Supreme Court, United States against .... The defendants have not been served with the writs in relation to such proceedings.

After further investigations into the matter by its lawyers in Australia, the Company has been advised that there would be no need to pursue parallel proceedings in the New York County Supreme Court as the Company's claims against the Defendants are both viable and within the jurisdiction of the Supreme Court of Victoria, Australia.

40 Those announcements demonstrate that the viability of the proceedings was considered more than six months prior to the expiration of the validity of the writ.

41 During the course of argument it transpired that there are parallel proceedings being prosecuted in S CI 2013 06563. The inference from Mr Whyte's affidavit is that the first to nine defendants are now not being sued. However, those defendants are named defendants in proceeding S CI 2013 06563 which, albeit at the suit of another plaintiff, are based on the same transaction with almost identical complaints.

42 The plaintiff's position is that it had made all reasonable efforts to serve the 14th, 15th and 17th defendants during the period in which the writ was valid for service. The plaintiff has good reason to extend the writ's validity for service because of the difficulty encountered in service.

The position put on behalf of Mr Hocking and adopted by the 17****th defendant

43 Mr Moore QC submitted that there is no explanation of the investigations about 'which claims to pursue' and 'for the purpose of preparing a statement of claim' set out by the plaintiff. The failure to explain those investigations is fatal.

44 The failure to commence attempts to serve Mr Hocking until just before the expiration of the validity or service of the writ cannot constitute 'reasonable attempts'.

45 There had been a non-disclosure of relevant matters, namely the Singapore Stock Exchange announcement and reference to proceeding S CI 2013 06563.

46 The delay constitutes prejudice of itself. The relevant delay is delay since the cause of action accrued. On any view, the course of action accrued no later than 15 September 2009 when the transaction collapsed. Further, the 14th defendant relies upon specific prejudice. There will be issues about recovery of records, and the fading of memories. I was referred to an affidavit of Lilian Rizio which had been sworn in this proceeding on 27 November 2014, which the 14th defendant submits, strongly suggests that relevant records of the first defendant relating to the transaction in issue are either lost or destroyed.

47 The applicable principles were summarised by Derham AsJ in Howard v Porter.[1] Those principles were adopted and referred to by Robson J in Re APCH Ltd (In liquidation).[2]

48 At [100] Robson J set out the summary by Derham AsJ as follows:

The plaintiffs submitted that the principles to be applied to extend the validity for service of a writ have been conveniently summarised by Derham AsJ in Howard v Power as follows:[3]

The principles applicable are well settled. They derive in part from earlier Rules (Order 8 Rule 1), which provided that the court might order that a writ be renewed if satisfied that reasonable efforts had been made to serve the defendant, or for "other good reason". Despite the change in language, however, the authorities make it clear that the court should determine the question of extending the validity of the Writ on the same basis as previously.8 Amongst the differences between the old and new Rules is a change of terminology, from renewal of the writ to extension of its validity. The principles applicable are, in summary, as follows:

(a) Although the power conferred by Rule 5.12 is wholly discretionary, a judge has to approach the exercise of the discretion in accordance with established principles: Dagnell v Freedman & Co [1993] 2 All ER 161 at 165 ("Dagnell");

(b) The jurisdiction given by the rule ought to be exercised with caution: Battersby v Anglo-American Oil Co Ltd ("Battersby");[4] Ramsay v Madgwicks[5] ("Madgwicks");

(c) It is the duty of a plaintiff to serve a writ promptly: Battersby at 32;

(d) An application to extend time for service is not granted as a matter of course: Battersby at 32_; Madgwicks; Savcor Pty Ltd v Cathodic Protection International APS_[6] ("Savcor");

(e) The first question to consider is whether the plaintiff has taken reasonable steps to serve the writ. If not, it then becomes necessary to consider whether there was "some other good reason" for making the order to extend time for service of the writ: Soper v Matsukawa[7] ("Soper"); Battersby;

(f) The plaintiff carries the onus of showing that there is a good reason for extending the time to serve the writ (Soper at 952; Madgwicks at 6; Savcor at [41]); the applicant's burden is no greater if the limitation period has expired between the date of issue of the writ and the date on which the application is made: Findlay at 187.

(g) Whether there is good reason depends on all the circumstances of the case: Dagnell at 165; Kleinwort Benson Ltd v Barbrak Ltd & Ors [1987] AC 597 at 622-3 ("Kleinwort"); and it is not possible to define or circumscribe the scope of the expression "good reason": Kleinwort;

(h) Where the application is made after the period for service has expired, the reason must be one of substance (Savcor at [41]);

(i) The selection of relevant factors to establish that there is a good reason for making the order, and the significance to be given to each of the factors, are matters of discretion (Soper at 954);

(j) The fact that the plaintiff decides not to serve the writ whilst some other case is tried, or to await some future development, is generally not a good reason to justify extending time for service. (Madgwicks at 4 and 5; Savcor at [42]; Dagnell at 165-168_._) It is for the Court and not for one of the litigants to decide whether there should be a stay, and it is not right that people should be left in ignorance that proceedings have been commenced against them if they are there to be served: Battersby at 32;[8]

(k) It is a relevant factor against the exercise of the discretion that the renewal of the writ might deprive the defendant of a limitation defence where the plaintiff has been aware that the passage of time might be dangerous: Battersby at 31-2; Madgwicks at 7; Soper at 953; see also Finlay v Littler [1992] VicRp 59; [1992] 2 VR 181 at 187 ("Finlay").

(l) It is a relevant factor against the exercise of the discretion that the defendant was unaware of and had no reason to expect that a writ had been issued against them: Madgwicks at 7; Kleinwort at 623-4).[9]

(m) The lapse of time is itself generally to be regarded as prejudicial to the defendant (Madgwicks at 7; Finlay at 188). In this contest, the relevant delay is to be measured from the time at which the plaintiff's cause of action arose (Tyson v Morgan [200] 1 Qd R 100 at 104.50);

(n) Any delay in making the application to extend the time for service of the writ is a relevant factor against the exercise of the discretion (Finlay at 187); delay preceding (as well as following) the issue of the writ is material (Soper at 953);

(o) The expiration of the limitation period will not in itself constitute a good reason for extending the validity of the writ (Finlay at 187), although it is relevant (Soper at 952); and

(p) It may be appropriate to have regard to the balance of hardship: Kleinwort at 622; Van Leer Australia Pty Ltd v Palace Shipping KK [1981] HCA 11; (1981) 180 CLR 337 at 343 and 346 ("Van Leer") (adopting the approach of Bray CJ in Victa Ltd v Johnson (1975) 10 SASR 496 at 502 ("Victa")).

The Australian cases differ from the English cases as to the effect of a limitation defence arising after the issue of a writ but before the application to extend the validity of the writ. The difference is traced by Stephen J in Van Leer at 341-6. His Honour preferred the approach of the Australian and Canadian courts. He quoted with approval what Bray CJ said in Victa.[10] Bray CJ stated that there was no rule that a defendant acquired an absolute right to immunity when a writ issued within the limitation period is not served and in the meantime the period expires. The English cases had stated a test that if the limitation period had expired it was only in exceptional circumstances that the writ would be renewed. This is not the Australian position.[11]

49 I determine the first question referred to in sub-paragraph (e) of Derham AsJ's summary must be answered in the negative.

50 In Van Leer Australia Pty Ltd v Palace Shipping KK[12] Stephen J (in chambers) considered whether reasonable efforts had been made to serve the defendant in that proceeding. Leave to serve a notice of concurrent writ upon the defendant was granted on 15 December 1978 being less than a month after issue of the writ commencing that proceeding. In October 1979 the plaintiff determined that it wished to proceed against Palace Shipping. It was not until 14 February 1980 that the documents thought to be necessary for service in Japan were filed with the Court. Further delays followed in late February and during March 1980. Notice of the writ on the defendant was ultimately served in October 1980. Stephen J said at [13]:

Some two years had then passed since delivery of the steel and almost a year since both issue of the writ and also expiration of the 12 months' limitation period. During that time the plaintiff had done nothing directly to inform Palace Shipping of the damaged condition of the steel ... there is no evidence from which I can infer that Palace Shipping had in fact become aware of the claim against it before it was served with notice of the writ in October 1980.

Moreover, until October 1979 the plaintiff had done nothing in preparation for effecting service on Palace Shipping in Japan. For example, what proved to be the very time-consuming preliminary of having prepared in acceptable form a Japanese translation of the notice of writ had not been set in train. The reason for this inaction was neither mishap nor oversight. It seems, rather, to have been due to a calculated decision to incur no costs in prosecuting the case against Palace Shipping so long as there were thought to be prospects of a successful outcome against Simsmetal ...

In the light of the circumstances as they now appear, it is clear that in November 1979, when the ex parte application to renew the writ was made, it could not be said, as the terms of O 8, r 1(2) require, that "reasonable efforts have been made to serve the defendant". It follows that, unless "other good reason" existed, the writ should not then have been renewed.

51 In Soper v Matsukawa[13] Young CJ set out that the writ in that action was issued on 12 September 1978 about three and a half months before the expiration of the limitation period. The writ was returned by the bailiff unserved on 5 October 1978. After the writ was returned there was no further step taken until August 1979. On 9 October 1978 however, the appellant's solicitors were informed that the respondent had returned to Japan permanently. On 15 November 1978 the appellant's solicitors made enquiries about whether the insurer would accept service. An offer was considered in February 1979. On 21 August 1979 McInerney J ordered renewal of the writ. On 20 February 1980 an order was made by Master Brett renewing the writ for a further six months and in July 1980 the practitioners learned that the documents had been returned from Japan unserved.

52 It was not until August 1980 that the appellant's solicitors first enquired as to the method of arranging service in a foreign country through diplomatic channels after Master Brett had made another order on 18 August for a further period of six months. Through September and October the plaintiff arranged translation of the documents. On 16 February 1981 Master Brett made a further order extending the period of the writ. By notice dated 15 July 1981 the respondent moved to set aside the four orders for renewal of the writ and the service of the notice of the writ out of the jurisdiction.

Approaching such a task, the first step is to ask whether reasonable steps have been made to serve the defendant. In this case it is conceded by the appellant that between November 1978 and August or September 1979 they had not. There is not even any explanation of why nothing had been done in that period. That branch of r1 of O. 8 could not, therefore, support McInerney J's order of 21 August 1979.[14]

54 It is clear from the material that no efforts to serve any defendant were made until the commencement of December 2014. No satisfactory explanation is given for that delay. The incorrect spelling of Mr Ellem's name and the failure to locate an address for Mr Juan must be viewed in that context. If efforts had been made a reasonable time prior to December 2014 those hurdles may have been easily overcome.

55 It was put to me that Mr Hocking avoided service and that of itself constituted good reason 'indeed the best reason' to extend the validity of the writ to allow service upon the 14th defendant. The expression 'the best reason' was used by Young CJ in Madgwicks when the Chief Justice referred to the 'best reason' as one where the defendant had been avoiding service or his address was unknown. Insofar as it is put that it illustrates that reasonable efforts were made to serve Mr Hocking. In the context of this application I do not agree.

56 Whilst I accept there is an inference which emanates from the process server's report about being told not to attend the offices (I draw no inference from the fact that Mr Hocking was not present on the days that the process server attended) such inference is only weak in circumstances where it emanated from one conversation in the cause of an attempt to serve at the 11th hour. I cannot conclude that there was any evasion of service arising from one conversation on one occasion. However, if it is a valid conclusion to be drawn the inference or conclusion is negated by or militated against what occurred subsequently.

57 Mr Hocking responded to Ms Rizio's email transmission. No explanation is proffered as to why that contact could not have been initiated in December 2014 or even before then. It illustrates and reinforces that no reasonable attempts were made to serve Mr Hocking.

58 I determine that the attempts to serve each of the three defendants did not constitute reasonable attempts in the circumstances.

59 Accordingly, it becomes necessary to consider whether there was some other good reason for making an order to extend time. The limitation period has expired. The plaintiff carries the onus of showing that there is good reason for extending the time to serve the writ. However, I accept that the burden is no greater if the limitation has expired between the date of issue and the date on which the application is made.

60 The power to extend time is wholly discretionary. The jurisdiction ought to be exercised with caution.

61 The factors that are in favour of the exercise of the discretion are that the plaintiff has applied prior to the expiry of the writ for its extension and, in least with respect to Mr Hocking, there is an element of evasion of service. However, I refer to my comments set out in paragraphs 56 and 57 hereof and discount the suggestion of evasion as being decisive of the issue.

62 What tells against the exercise of the discretion in favour of the plaintiff is as follows:

(a) The plaintiff made a conscious decision not to serve the writ promptly. The preparation of the statement of claim does not constitute good reason to justify extending the time. There is no explanation as to why the writ could not have been served with the general endorsement and a statement of claim served subsequently;

(b) The plaintiff failed to draw to the Court's attention that it had issued the press release in April of 2014 to the effect that it had received advice that the claim was viable within the jurisdiction of the Supreme Court of Victoria. No explanation was provided as to why this proceeding could not have been served from that time;

(c) To the extent that there was the inference that the machinations about whether to serve or not were based upon consideration of appropriate defendants, it was not until the hearing of this application that my attention was drawn to the proceeding in 2013 06563. Albeit that the plaintiff is not Global Investments Ltd, it is a claim by Babcock & Brown DIF III Global Co-Investment Fund Ltd which is based upon the BBRX IV transaction, the Everest loan, the interest rate swap and, in that case, the loss of investment in Rail Syndicate Two Ltd. Again the representations are virtually identical. Some of the defendants are identical but certainly not the 14th, 15th and 17th in this proceeding. The writ in that proceeding, also filed on 19 December 2013, was filed by the plaintiff's solicitors in this proceeding. The inference that flows from the parallel proceeding is that there was something more than merely a decision not to prosecute some of the defendants in this proceeding. I am left in the dark but it illustrates that the plaintiff has not discharged its duty to make full disclosure.

(d) In Varga v Mandapati[15] it was said:

Finally, I wish to make some observations on the use of hearsay material on renewal applications. An applicant must satisfy the court that there is good reason to order renewal. In most cases the applicant must explain the delay. An applicant who is at fault is not necessarily disentitled. Generally, it is expected that an applicant seeking a favourable exercise of the discretion to renew will furnish the court with a full and frank explanation for the delay so as to put the court in a position to properly weigh the relevant considerations and so make an informed determination as to whether good reason to renew exists. An applicant who fails to give a complete explanation for the delay, in circumstances where such an explanation is called for, and so deprives the court of relevant information cannot expect to receive a favourable exercise of the discretion.

(e) In Re APCH Ltd Robson J said this at [99]:

An applicant for an ex parte order has an obligation to the court of the utmost good faith, "uberrimae fidei." In Savcor Pty Ltd v Cathodic Protection International APS the Court of Appeal held that this duty expressly applies to an ex parte application to extend the time for service of a writ. There, Gillard AJA said that "[t]he obligation requiring full disclosure of all material facts must be complied with on pain of penalty that the order will be set aside".[16]

(f) Each of these references confirm that the failure to make full disclosure is a factor to which I may have regard.

(g) The limitation period has expired which, although not a decisive factor, is still a factor which must be given weight. Particularly, in this proceeding where it has been pleaded that participants are now deregistered and where I have been referred to material set out in an earlier affidavit sworn in this proceeding the conclusion distilled from which is that there will be some difficulty in locating relevant documents if they exist at all. That difficulty for the 14th, 15th and 17th defendants is reinforced by the claim against them which 'lumps' them in with the corporate defendant against whom the plaintiff makes allegations.

(h) Although that the 14th defendant had access to the Singapore press releases, the plaintiff did not press that the 14th, 15th and 17th defendants had any notice given by the plaintiff that the proceeding would be served upon them.

(i) This is a proceeding where, although that the representations, conduct and breaches complained upon are substantially contained in or derived from the prospectus, the time from which the cause of action accrued which has elapsed is prejudicial of itself. The 14th, 15th and 17th defendants were described as being co-opted as employees or agents seconded to BBGIM. With the passage of time it cannot be expected that defendants in this position would have retained records or had retained details of the events in contrast with what might be expected of an officer of a defendant.

63 Accordingly, I determine that there is no 'other good reason' for exercising the jurisdiction in favour of the plaintiff.

64 Having made that determination I should also note that counsel for Mr Hocking submitted that there was doubt about whether the Court on an application such as this is able to consider whether the plaintiff's claim has substance. It was drawn to my attention passages in Madgwicks at [5] where the Chief Justice, although stressing that such an application is not 'a pleading summons' set out the plaintiff's claim in summary. I cannot conclude that the Chief Justice had regard to the nature of the claim in arriving at a determination whether good reason had been made out. In any event, Hansen J noted that the Chief Justice rejected an attempt to raise the merits and referred to the same passage in Madgwicks.[17] My attention was also drawn to paragraph [48] of the decision of the Queensland Court of Appeal in IMB Group Pty Ltd (in liq) v Australian Competition and Consumer Commission,[18] where at [48] Keane JA at paragraphs [44] through to [47] considered the merits of the plaintiffs claim. However, again it is not clear if the consideration was incorporated as a factor in assessing whether there is 'good reason' or in conjunction with some other factor.

65 In any event, although I note that the plaintiff appeared to agree to indemnify all employees of the first defendant and its related entities this is not a pleading summons or a summary judgment application and I have not and could not be expected to determine what ensues from the giving of such indemnity to properly consider the merits of the claim.

66 The consequences of declining to renew the writ is that the summons for substituted service must also be dismissed.

67 If I had renewed the writ I would have been satisfied that orders for substituted service were appropriate where the plaintiff thought necessary, given that it had been demonstrated that the proceeding had already been informally served, alternatively brought to the attention or could be brought to the attention of the relevant defendant.

68 The orders will be that each summons is dismissed and the plaintiff pay the costs of the 14th and 17th defendants on a standard basis.

BABCOCK & BROWN GLOBAL INVESTMENTS MANAGEMENT PTY LTD ACN 118 871 140

[1] [2013] VSC 198.

[2] [2014] VSC 190 ('Re APCH Ltd').

[3] [2013] VSC 198, [10] (citation in original).

[4] [1945] KB 23, 32-3 (Lord Goddard) (citation in original).

[5] [1989] VicRp 1; [1989] VR 1, 5.5 (citation in original).

[6] (2005) VR 639, 651 (citation in original).

[7] [1982] VicRp 96; [1982] VR 948, 952.9 (citation in original).

[8] But there are cases where to await the outcome of a test case is a good reason: see Kleinwort, above n [8], 619-624 (citation in original).

[9] It seems that this factor may be based in part on what Lord Goddard said in Battersby, above n [9], 32 that it is not right that people should be left in ignorance that proceedings have been taken against them if they are available to be served (citation in original).

[10] (1975) 10 SASR 496 (citation in original).

[11] Savcor v Cathodic, [41] (citation in original).

[12] [1981] HCA 11; (1981) 180 CLR 337.

[13] [1982] VicRp 96; [1982] VR 948.

[15] [2014] TASSC 25, [25].

[17] Protec Pacific Pty Ltd v Steuler Industriewerke GmbH [2007] VSC 93, [43].

[18] [2006] QCA 407; [2007] 1 Qd R 148.