Slaven v Tisot

Federal Court of Australia|2018-10-19|Before: Mr J, Griffiths J

Pursuant to r 1.34 of the Federal Court Rules 2011 (Cth) dispensation is granted to the second defendant from compliance with r 4.01(2), such that the first defendant may appear in this matter on behalf of the second defendant.
The interlocutory application dated 28 September 2018 otherwise be dismissed.
The costs of the interlocutory application be the plaintiffs' costs in the cause.
The case management hearing scheduled for 6 November 2018 be vacated.
The defendants are to file and serve any evidence on which they intend to rely by 16 November 2018.
The plaintiffs are to file and serve any evidence in reply by 23 November 2018.
The plaintiffs are to file and serve a paginated tender bundle by 23 November 2018.
The plaintiffs are to file and serve an outline of written submissions not exceeding ten pages in length by 23 November 2018.
The parties are to seek to agree and file a statement of facts and issues on or before 28 November 2018.
Notice that any witness is required for cross-examination must be given by 28 November 2018.
The defendants are to file and serve a written outline of submissions not exceeding ten pages in length by 30 November 2018.
The parties are to file and serve a list of any objections to affidavit evidence by 30 November 2018 with a brief statement of the ground(s) of objection.
Liberty to apply on the giving of 48 hours' notice. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Consideration and determination 18 The interlocutory application dated 28 September 2018 raises two central issues. First, whether the time for the filing of evidence should be extended and the hearing which is proposed to commence on 3 December 2018 be vacated with a view to the hearing commencing sometime in March 2019. Secondly, should leave be granted for the second defendant to be represented by Mr Tisot. I will address each of those matters in turn.

(a) Should the hearing be vacated and additional time be given for the filing of evidence? 19 Mr Tisot has not persuaded me that the hearing scheduled for 3 December 2018 should be vacated and replaced with a timetable which would see the hearing commence sometime in March 2019. As noted above, the proceeding has been on foot for some time. Moreover, as long ago as December last year, the parties were then agreed that the hearing could commence on 11 May 2018. 20 As noted above, the Court has previously dismissed an application by the first defendant to extend the time for the defendants to file and serve their evidence to 31 December 2018. On that day (20 July 2018), the matter was listed for hearing on 3 December 2018 and the time within which the defendants had to file their evidence was extended to 28 September 2018. The first defendant then left it to that day to file the current interlocutory application and the supporting affidavits. 21 I do not doubt the magnitude of the documentation which has been served on the defendants, none of whom are legally represented (while noting that only the first and sixth defendants are active parties). The first and sixth defendants have had since mid-June to analyse that material, which is more than 4 months. It is apparent from Mr Tisot's affidavit that he already had in his possession copies of some Company books which he has used to assist him in that analysis. As the sole director of the Company, it can be assumed that Mr Tisot has a good familiarity with the Company's records, including relevant invoices. Mr Tisot says that certain discrepancies and inconsistencies have emerged and that there are errors in the last two creditors' reports, but I do not regard those matters as providing a sufficient basis for vacating the hearing date. 22 I have taken into account Mr Tisot's evidence regarding his son's health (which is unsupported by any independent medical evidence) and his responsibilities as the sole carer of his mother, but I do not consider that these matters outweigh the desirability of maintaining the current hearing date in order that the serious allegations made against the defendants be heard and determined so that there is finality. I have also taken into account the overarching purpose of civil litigation, as expressed in s 37M of the Federal Court of Australia Act 1976 (Cth). 23 I will, however, make certain adjustments to the timetable which will require the defendants to file and serve any evidence upon which they intend to rely by no later than 16 November 2018, which is approximately four weeks from now. It is assumed that the defendants have proceeded to prepare for the hearing in circumstances where the outcome of their interlocutory application dated 28 September 2018 was unknown. I will provide a short period for the plaintiffs to file any evidence in reply and also make a direction which aims to have the parties seek to agree a statement of facts and issues. I will also make directions for the filing and serving of brief outlines of written submissions and give other directions which are intended to have the hearing run smoothly from 3 December 2018.

(b) Should leave be granted for Mr Tisot to represent the second defendant? 24 The principles guiding the exercise of the discretion to waive compliance under r 1.34 of the Federal Court Rules 2011 (Cth) (2011 FCRs) so as to permit a company to be represented by a person other than a legal practitioner in spite of r 4.01(2) are well known. They are summarised in Enviro Pak Pty Ltd v New Horticulture Pty Ltd [2013] FCA 306 (Enviro Pak) at [16]-[18] per Griffiths J: 16. … A leading case in this context is the decision of French J, when he was a member of this Court, in Termi-Mesh Australia Pty Limited v Josu Manufacturing Pty Limited [1999] FCA 1241 ('Termi-Mesh'), where his Honour sets out various matters relevant to the exercise of the discretion under the earlier rules of the Court. His Honour made it clear that the policy of the rules is that ordinarily a corporation is required to be represented by a solicitor. His Honour then identified, in [13], various factors that may be relevant to determining whether that rule should effectively be waived in any particular case. Such relevant factors include the financial capacity or lack of capacity of the corporation and those standing behind it, the effect of diverting company resources to paying legal expenses, the nature of the company's undertaking, its financial structure, its ability to retain and pay its staff and the identity and spread of its shareholders. His Honour added that the factual complexities of the case and the capacity of the proposed representative to conduct the proceedings are also relevant matters. 17. An additional consideration which has some relevance to the circumstances here is his Honour's acknowledgement in [14] of his reasons for judgment in Termi-Mesh, to the effect that a more liberal approach may be warranted in circumstances where the corporation seeking the dispensation is a respondent in proceedings and not the applicant. 18. Another relevant authority which I have found helpful in considering this application is the decision of Murphy J in Deputy Commissioner of Taxation v Compumark Pty Ltd (2012) 292 ALR 83. After referring to and affirming the factors identified by French J in Termi-Mesh, Murphy J identified some other matters that might bear upon the question. Those matters are set out in [20] of his Honour's judgment and are drawn from criteria identified by Forrest J in Worldwide Enterprises Pty Ltd v Silberman (2009) VSC 165 at 20. The factors identified are: (a) the manner in which the case has progressed to date; (b) the manner in which the case can proceed in the future without a solicitor; (c) the complexity of the issues involved in the case; (d) whether the lack of disciplinary measures in relation to the person seeking to represent the company will affect the administration of justice; (e) whether the case can be conducted in an orderly and responsible fashion without a solicitor; (f) whether there are financial considerations which would inhibit a company from obtaining legal representation; (g) the stage which the case has reached; (h) whether the defendant is likely to expend more funds in defending the claim absent a solicitor acting for the company; and (i) the effect, if any, on court resources and in particular on other litigants in the court list if the company were to appear without a solicitor. 25 Guided by these general principles, each case will ultimately turn upon its own particular facts. Factors which weigh in favour of granting the dispensation here include the following: (a) on 23 November 2017, the second defendant filed a submitting notice stating that it submitted to any order the Court may make in the proceeding and that it did not want to be heard on the question of costs. Necessarily, therefore, as matters stand at present, the second defendant's role will be infinitesimal; (b) Mr Tisot is entitled to represent himself as the first defendant. Accordingly, he will participate in the proceeding personally irrespective of the outcome of the interlocutory application. As stated in Enviro Pak at [22], this is an important consideration which weakens the weight which might otherwise have been accorded to other relevant factors or considerations weighing against granting the dispensation; (c) based on the Court's observations of Mr Tisot's participation in case management hearings, although he is not legally qualified, he appears to have a sound understanding of the underlying factual matters which give rise to the proceedings and is capable of presenting an argument coherently and responsibly, noting also that Mr Tisot represented himself in proceedings in the Supreme Court of New South Wales in October 2015; and (d) finally, and significantly, there is the issue of the stage of the proceedings. If dispensation is not granted and the second defendant seeks to obtain legal representation at this point, even if it were able to do so, there inevitably would be a further potentially lengthy delay in bringing the matter to a substantive hearing. That is most undesirable even though the second defendant would be responsible for that state of affairs given the belated timing of the interlocutory application. I consider that the plaintiffs should not be subjected to any further delay in the conduct of the proceeding. 26 Accordingly, for these reasons, the Court will grant leave under r 1.34 of the 2011 FCRs and dispense with the requirement under r 4.01(2) that the second defendant be represented by a legal practitioner.

Conclusion 27 For the reasons given above, those parts of the interlocutory application which relate to the vacation of the hearing and related matters will be dismissed. Some adjustments will be made to the timetable with a view to the scheduled hearing commencing on 3 December 2018. The second defendant will have leave to be represented by Mr Tisot. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths.

SCHEDULE OF PARTIES ACD 72 of 2017 Plaintiffs Second Plaintiff: JT ELECTRICAL & PLUMBING PTY LIMITED (IN LIQUIDATION) ACN 091 997 894 Defendants Second Defendant: BZ CONSTRUCTIONS PTY LTD ACN 106 132 307 Third Defendant: J-TEP ASSOCIATES PTY LTD ACN 607 840 666 Fourth Defendant: J-TEP TRADING PTY LTD ACN 607 840 675 Fifth Defendant: J-TEP AUS PTY LTD ACN 607 817 863 Sixth Defendant: MATTHEW PETER TISOT Seventh Defendant: COMBINED BUILDING AND SERVICES PTY LTD (DEREGISTERED) ACN 157 850 112

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