Pritchard v Fryer

Notices of motion for determination

1. The first notice of motion which is before the Court was filed by Mr Pritchard on 9 April last year; it is motion number 6 in the court's electronic record keeping system. The notice of motion sought various forms of relief which are not now pressed. For present purposes, the significant prayers for relief fall into two classes.
2. First, pursuant to Uniform Civil Procedure Rules NSW (2005), r 28.2, Mr Pritchard seeks orders isolating for preliminary determination certain specified questions of fact and law which, so he contends, are relevant to his claim in these proceedings.
3. Secondly, Mr Pritchard seeks orders against Mr Fryer and Mr Sharrock that each of them pay a pecuniary penalty under s 224 of the Australian Consumer Law ("ACL") for alleged contraventions of the ACL by Mr Fryer in which Mr Sharrock was allegedly knowingly concerned. Alternatively, Mr Pritchard seeks leave to include these claims as additional relief in Mr Pritchard's cross‑claim.
4. The next notice of motion is dated 12 July. This notice of motion was filed by Mr Fryer. He seeks orders that Mr Pritchard's statement of cross‑claim be struck out and that judgment be entered summarily in his favour. Alternatively, he seeks to have the proceedings stayed pending payment of costs owing under orders made in his favour in this Court and in the Local Court in other proceedings to which I will refer in more detail shortly. As a further alternative, he seeks security for costs.
5. Mr Fryer's notice of motion was followed on 1 August by a notice of motion filed on behalf of Mr Sharrock. This seeks orders that the statement of cross-claim be struck out as against Mr Sharrock and further, or in the alternative, an order for summary dismissal of the claim against him.
6. The fourth notice of motion was filed by Mr Pritchard on 9 August. For present purposes, the prayers for relief can be summarised as follows. First, Mr Pritchard seeks orders that proceedings on Mr Fryer's and Mr Sharrock's notices of motion (which I will refer to as the strike-out motions) themselves be stayed. Second, Mr Pritchard seeks to have the Court decide some further specified preliminary questions of fact and law pursuant to UCPR r 28.2.
7. On 22 August last year, these four notices of motion were fixed for hearing for two days, beginning on 23 March this year (yesterday). In the usual way, the Registrar fixed a timetable of procedural directions to make the applications ready for hearing.
8. Not long before the hearing, Mr Pritchard filed two further notices of motion. These notices of motion were referred by the Registrar to me and at a directions hearing on 12 March it was agreed that they too would be dealt with at the hearing fixed for 23 March.
9. The first of those notices of motion was filed on 21 February. Again, it seeks orders that the proceedings on the strike-out motions be stayed. It also seeks leave for Mr Pritchard to amend his statement of cross‑claim. It also seeks to have further identified questions of fact and law preliminarily determined pursuant to UCPR 28.2.
10. The second of the recent notices of motion was filed on 2 March. It identifies yet further questions of fact and law for determination under UCPR r 28.2. The notice of motion also sought leave to commence a private criminal prosecution against Mr Fryer and Mr Sharrock. At the hearing before me, however, Mr Pritchard accepted that the procedure proposed in the notice of motion was inappropriate for this purpose and the application could not be pressed in these proceedings.

Outline of the dispute

1. Mr Fryer is a craftsman who makes and repairs electric guitars and electric guitar components. Mr Pritchard has an interest in electric guitars and dealt with Mr Fryer on various guitar‑related jobs and projects over the years, going back to the 1990s. This involved, among other things, Mr Pritchard delivering several guitars or guitar components to Mr Fryer for him to work on.
2. Disputes arose between Mr Pritchard and Mr Fryer at some point in late 2015 or early 2016. On 21 April 2016, Mr Fryer sent a letter to Mr Pritchard, which appears to have been mainly responsible for precipitating the current proceedings. According to Mr Pritchard's statement of cross‑claim, the letter intimated that Mr Fryer would retain Mr Pritchard's goods unless Mr Pritchard took steps to retrieve them. The letter also stated that Mr Fryer would claim a lien over Mr Pritchard's goods for worked done but not paid for, and would claim storage costs for those goods from 1 May 2016 onwards. According to the statement of cross-claim, Mr Fryer subsequently issued tax invoices for work that he claimed he had done on Mr Pritchard's goods and for storage.
3. This is where Mr Sharrock comes in. He is a barrister who acted for Mr Fryer on a direct access basis in connection with the dispute with Mr Pritchard. In particular, he appears to have assisted Mr Fryer with formulating the letter of 21 April 2016.
4. The dispute appears to have given rise to two other earlier sets of proceedings. There were proceedings brought in the Local Court (I assume by Mr Fryer against Mr Pritchard). Proceedings were also commenced in this Court in 2016 by Mr Pritchard against Mr Fryer. That was apparently some sort of claim for specific performance. It came before Robb J, who dismissed the claim in December 2017: Pritchard v Fryer [2017] NSWSC 1752. His Honour did so essentially because Mr Pritchard had failed to articulate in his pleadings a proper and reasonable basis for the claims for relief which he was making. His Honour's decision was, therefore, not one which dealt with the merits of the claim which Mr Pritchard was making.
5. As a result of both of those proceedings, costs orders were made in favour of Mr Fryer. Mr Fryer has now commenced bankruptcy proceedings as a result of the failure by Mr Pritchard to pay those costs. I was told that the bankruptcy proceedings have been held over pending the outcome of the applications which are before me.
6. I should mention that this Court's file in the 2016 proceedings is still active. Mr Pritchard has filed a notice of motion seeking the preliminary determination of certain issues of fact and law which are similar to those which are the subject of the applications before me. The application in the 2016 proceedings has been listed before Robb J on 7 April. It is not clear to me what basis there is for the further application in the 2016 proceedings, and I note that Robb J has not undertaken to hear the application; it is only to be before him for directions.
7. In the prayers for relief in Mr Pritchard's statement of cross‑claim he first sought an order that Mr Fryer's claim in his originating summons be struck out and that all of Mr Pritchard's goods be immediately returned to him by Mr Fryer. Mr Pritchard went on to claim damages or compensation from "the defendant" under the Australian Consumer Law. From the rest of the statement of cross-claim it is clear that the reference to "the defendant" was intended to cover both Mr Fryer and Mr Sharrock. Mr Pritchard alleges that Mr Fryer contravened consumer protection provisions of the ACL and that Mr Sharrock was knowingly concerned in the contraventions by Mr Fryer, so that he is liable alongside Mr Fryer for the damages claimed.
8. As I have mentioned, Mr Fryer subsequently discontinued his claim against Mr Pritchard. Mr Pritchard also told me that all of his goods have been returned by Mr Fryer. When I asked him what damage he had suffered (because, as will be seen, this was not pleaded in the statement of cross‑claim) Mr Pritchard told me that the damages he was claiming represented the costs which had been awarded against him in the Local Court and Supreme Court proceedings.
9. The total amount of those costs, according to Mr Pritchard, was only about $100,000. Mr Pritchard accepted that if the proceedings continue, they should be sent to the Local Court or the District Court for determination, depending on whether the amount claimed exceeds the jurisdictional limit of the Local Court.
10. This is where Mr Pritchard's claim ends. But it is not the end of the allegations that Mr Pritchard makes against Mr Fryer and Mr Sharrock. In his affidavits and submissions, Mr Pritchard asserts that Mr Fryer and Mr Sharrock were party to what Mr Pritchard calls the "iniquitous scheme". This scheme defies precise description, but the complaint appears to extend, not only to the letter of 21 April 2016, but also to the conduct of the Local Court proceedings, the 2016 proceedings and, perhaps, these proceedings as well.
11. The alleged scheme has elements of duress and abuse of legal process. If Mr Pritchard's claims were properly capable of being formulated in pleadings, they would seem to involve claims for damages under the tort of abuse of process, and perhaps, also the tort of conspiracy or the tort of deceit. But no such claims, or the facts of the "iniquitous scheme", have been pleaded in Mr Pritchard's statement of cross‑claim.

Stay or adjournment of strike-out motions

1. The first question for me is whether the proceedings on the strike-out motions should be stayed as Mr Pritchard seeks. In making his submissions in support of this application, Mr Pritchard complained at length about the alleged "iniquitous scheme". But he also pointed to the notice of motion now listed for directions before Robb J in the 2016 proceedings. It emerged that Mr Pritchard was seeking, in effect, an adjournment of the strike-out motions until after Robb J has dealt with the application in the 2016 proceedings.
2. It must be emphasised that the allegations concerning the "iniquitous scheme" are just that, allegations. Wrongdoing is denied by both Mr Fryer and Mr Sharrock. It is impossible for the Court in interlocutory proceedings to determine finally whether these allegations have any substance or not.
3. In these circumstances, the application by Mr Pritchard to have the strike-out motions stayed is untenable. The motions attack the very validity of Mr Pritchard's cross-claim proceedings. Whether they will succeed remains to be seen. But it would be quite wrong for the Court, on the basis of untested allegations of generalised misconduct, to shut out a party from even being able to argue that the claim against him is hopeless. If Mr Pritchard's claims are not tenable, then they should not be permitted to proceed further, at least in their current form.
4. Nor, in my opinion, is there any good reason to adjourn the hearing of the strike-out motions. As I have pointed out, Robb J has not even agreed to hear Mr Pritchard's notice of motion in the 2016 proceedings. The current fixture dates back six months and these proceedings have already been protracted for far too long.
5. For these reasons, having heard argument on the stay application, I refused it and continued with the hearing on the strike-out applications and the remainder of Mr Pritchard's prayers for relief in his notices of motion.

Strike-out motions

1. As I have already indicated, Mr Pritchard's substantive claim is for damages or compensation for contravention of the ACL. The pleaded contraventions are engaging in misleading or deceptive conduct or making false or misleading representations (ss 18, 29, 33, 34) and engaging in unconscionable conduct (ss 20, 21, and the general law).
2. In the course of the oral argument, I went through with Mr Pritchard the elements of the causes of action which he has advanced. His claim for misleading and deceptive conduct has four elements which require pleading. First, identification of the conduct on which Mr Pritchard relies (and which needs to be identified with precision so that the other elements can be assessed by reference to it). Second, facts which show that the conduct was misleading or deceptive. Third, that the conduct occurred in trade or commerce (a potentially significant issue for the claim against Mr Sharrock). Fourth, that the conduct caused Mr Pritchard to suffer damage. The elements of the claim for unconscionable conduct broadly parallel the elements of the misleading and deceptive conduct claim.
3. After this had been explained to him, Mr Pritchard acknowledged that there are elements of his claim which are not pleaded, or not properly pleaded. This acknowledgment is clearly correct. Mr Pritchard's statement of cross-claim does not actually plead that he had suffered any damage at all, and still less that the damage was caused by contraventions of the ACL. The pleading is also unclear, at least to my mind, in the identification of the particular conduct which is said to have been misleading or deceptive (or unconscionable) and the facts which render that conduct misleading or deceptive (or unconscionable).
4. Mr Pritchard was thus obliged to accept that his statement of cross‑claim is inadequate and does not comply with the Rules. His response was to seek leave from the Court to re‑plead it. I will return to this question in due course.

Remaining relief sought in Mr Pritchard's notices of motion

1. The principal remaining relief sought by Mr Pritchard is a series of orders for preliminary determination of identified questions of fact and law under UCPR r 28.2.
2. The Court's power under UCPR r 28.2 can be useful but the Court must be cautious in exercising the power lest it not achieve its purpose of saving time and money. One well known reason for the Court's reluctance to make an order under r 28.2 is the risk that such an order will multiply proceedings, with points litigated in the preliminary hearing being litigated again in the final hearing, resulting in additional costs and potentially conflicting decisions. Another problem is associated with the formulation of the separate questions. There can be a risk that following the preliminary hearing, further issues arise or the parties come to see the case in a different way and the answers given by the Court do not prove to be determinative. Indeed, in some cases they can become a source of further dispute so that the Court finds itself embroiled in an argument about what the answers to the preliminary questions actually mean for the parties' rights.
3. An example of one of the questions of fact and law propounded for preliminary determination by Mr Pritchard is prayer 12 in the notice of motion of 21 February 2020: The Court decide the question of fact and law: Whether, in circumstances where: (a) A Bailor is unaware of the factual total cost for work executed by a Bailee to bailed goods; and (b) The Bailee: (i) fails to notify the Bailor of the actual total cost of the work executed by the Bailee to the bailed goods; or (ii) fails to issue the Bailor with an Invoice for the actual total cost of the work executed by the Bailee to the bailed goods, The bailed goods are not "uncollected goods" for the purposes of Section 5(a) of the Uncollected Goods Act NSW 1995.
4. In my opinion, this proposed question clearly illustrates the problems with Mr Pritchard's applications under UCPR r 28.2. It is not clear how, if at all, the question fits in with the pleaded allegations made in Mr Pritchard's statement of cross‑claim. Should the Court make an order for the determination of that question and other questions like it, there is a high risk, and indeed, in my mind, a virtual certainty, that the separate determinations would not lead to any saving of time or money. Rather, they would just lead to further wrangling about allegations made by Mr Pritchard which, on the face of it, have little if anything to do with his claim for damages.
5. For these reasons, I decline to make any of the orders for determination of preliminary questions formulated by Mr Pritchard.
6. The remaining prayers for relief which need to be considered are those concerning the claim for a pecuniary penalty. It should be said at once that these are substantive claims and therefore quite inappropriate for a notice of motion. If any claim for pecuniary penalty were to be made, it should be propounded in the proper way in accordance with the rules, presumably in a statement of claim or some similar form of pleaded allegations on which issue could be joined.
7. But another problem was raised by counsel for Mr Sharrock. A pecuniary penalty is only payable either to the Commonwealth government or to a State or Territory government. It is not clear to me that an ordinary member of the public, as distinct from a regulator, is entitled to seek an order for a pecuniary penalty: see ACL s 228. This point was put to Mr Pritchard, but he did not respond to it.
8. In the circumstances, I am simply not satisfied that there is even a viable claim. I therefore do not propose to permit Mr Pritchard, in accordance with his alternative prayer for relief, to amend his statement of claim so as to seek payment of a pecuniary penalty. In the light of the chequered history of these proceedings, and given that Mr Pritchard is pursuing civil claims for damages, the Court should not be doing anything to encourage Mr Pritchard to seek pecuniary penalties as well.

Leave to re-plead

1. As I have mentioned, Mr Pritchard, acknowledging the defects in his statement of cross‑claim, sought leave to re‑plead. Both Mr Fryer and counsel for Mr Sharrock opposed this course and instead pressed to have the proceedings summarily dismissed.
2. There are many difficulties facing Mr Pritchard's claim. Although, as I have said, I took Mr Pritchard through the elements which need to be proved under the relevant parts of the ACL, I have no confidence based on the way he has conducted these applications before me that he has the ability to formulate the necessary allegations (if a proper factual basis for them actually exists).
3. Mr Pritchard peppered his submissions to me with apologetic statements about being an unrepresented litigant. That is not necessarily a barrier to propounding a claim to the Court, although lack of experience can make things difficult. But Mr Pritchard in the course of his arguments exhibited a determined refusal to come to grips with the points which I asked him to address. All I can say is that formulation of a proper statement of claim will require a degree of self‑discipline and critical thinking, which, with all respect to Mr Pritchard, he has not manifested in the applications before me.
4. But even if a proper claim under the ACL could be formulated, it still has its difficulties. The damages claimed by Mr Pritchard consist entirely of costs awarded against him in earlier court proceedings. His attempt to claim these costs back smacks of making a collateral challenge to the original decisions under which the costs were awarded. I am not sure, in those circumstances, that the claim is even maintainable. Furthermore, as Mr Fryer pointed out, Mr Pritchard's statement of cross‑claim is full of allegations about events going back long before 2016, and indeed before 2012. Part or all of those claims may be statute-barred.
5. As I have already mentioned, the amount involved in the claim is relatively small. The proceedings have already been unnecessarily protracted. I was taken to correspondence which shows that Mr Pritchard was given a clearly and fairly stated opportunity to reconsider his pleadings before the strike-out motions were pursued against him. All of these are significant discretionary factors which tell against Mr Pritchard having a further opportunity to reformulate his statement of cross‑claim.
6. But taking them all into account, I do not think that these difficulties are decisive. I am conscious of the need to preserve Mr Pritchard's right to his day in court, if he is able to formulate a viable claim and the cross-defendants' legitimate interests can be protected.
7. The argument that Mr Pritchard's claims are statute-barred is a defence which must be pleaded and is not a basis for strike-out. Any point about collateral challenge to earlier proceedings seems to me to fall into the same category. I do not think the Court should take the step of summarily dismissing proceedings on the basis of a defence which has not even yet been formally articulated.
8. I have therefore decided that I will give Mr Pritchard a further opportunity to seek leave to amend his statement of cross‑claim. I will, however, limit the leave to the prayers for relief in the existing pleading. The prayers for relief which have fallen away will be struck out. The pleading and particulars section will be struck out in its entirety. Mr Pritchard will then have the opportunity, if he can, to formulate a proper series of factual allegations in support of his claims for damages under the ACL. I also make it clear that if a viable statement of cross‑claim emerges at the end of the process, then the proceedings will be sent to the District Court (or the Local Court if, on analysis, the claim falls within the Local Court's jurisdiction).
9. Most importantly, the grant of this leave will be the subject of strict conditions designed to ensure that it does not become a vehicle for further oppression of the cross‑defendants. I propose to make the grant of leave conditional upon Mr Pritchard paying to each of the cross‑defendants an amount on account of the costs thrown away by reason of the proposed further amendment. Those costs will include any costs which are awarded against Mr Pritchard in these applications.
10. This means that Mr Pritchard will not have an opportunity even to seek leave to propound a proposed new statement of cross-claim unless he first pays monies to the cross-defendants on account of their costs. I consider that it is necessary to ensure that Mr Pritchard seriously considers whether he wishes to continue these proceedings, and, if he does, that he first covers the costs incurred by the cross‑defendants which have so far been wasted. [Parties addressed on the form of orders to be made and on costs]
11. The orders of the Court are:
12. Proceedings adjourned for the making of final orders to 4pm Wednesday 1 April 2020.

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