Tadros v J & R Investment Services Pty Ltd

REASONS FOR JUDGMENT BUCHANAN J: 1 This matter has a long, chequered and unsatisfactory history. All parties have been in breach of the Court's orders. 2 The proceedings were commenced by application and statement of claim filed on 3 October 2006. I indicated in an earlier judgment (Tadros v J & R Investment Services Pty Ltd [2007] FCA 1041) that the statement of claim was not in a satisfactory form. Directions were made on 9 July 2007 granting the applicant leave to file an amended statement of claim before 27 July 2007. Provision was made for the filing of defences and any necessary reply to a defence. An amended statement of claim was filed, out of time, on 31 July 2007. In response, the first to fourth respondents filed a notice of motion on 24 August 2007 to strike out the amended statement of claim. The sixth respondent filed a notice of motion seeking security for costs but did not, as required by the directions earlier made, file a defence. Neither did the fifth respondent. In addition the applicant filed a notice of motion, also on 24 August 2007, that the proceedings be transferred to the Supreme Court of New South Wales. There were no proceedings pending before that court which might provide a foundation for the request to transfer the proceedings (see s 86A of the Trade Practices Act 1974 (Cth) and s 5 of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth)). On 29 August 2007 I dismissed that notice of motion. 3 I listed the other notices of motion (to strike out the amended statement of claim and for security for costs) on 15 October 2007. On 15 October 2007 the parties were not ready. The matter was adjourned to 12 December 2007. I will not extend this judgment by describing the interlocutory skirmishes in which the parties indulged themselves both in the period shortly before the hearing listed for 12 December 2007 and at earlier times. The parties did not comply with the Court's directions and with relevant requirements of the Federal Court Rules. The notices of motion were not in a satisfactory position to be heard. However, the parties on that day sought some time in which to engage in immediate negotiations. Those negotiations resulted in an agreement reflected in the following orders, which I made by consent: '1. The Notice of Motion for strike out as filed by the 1st, 2nd, 3rd and 4th Respondents is adjourned generally with liberty to restore on two (2) days notice. 2. The Applicant has leave to file and serve by 4pm 1 February 2008 a Notice of Motion for leave to file a Further Amended Statement of Claim and Amended Application. 3. The Applicant pay the costs of the Motion for Strike Out in the amount of $22,000.00 by 4pm 25 January 2008 on delivery to the office of the solicitor for the 1st, 2nd, 3rd and 4th Respondents. 4. Should the Applicant fail to comply with Order 3 herein, then Order 2 is vacated and the whole of the Amended Statement of Claim is struck out.' The proceedings were then adjourned to 7 March 2008. 4 On 7 March 2008 the parties informed me that order 3 had not been complied with. The consequence was that pursuant to order 4 the amended statement of claim was struck out. The only matter remaining before the Court concerned any question of costs (see O 62 r 3(1) of the Federal Court Rules). The fifth respondent sought an order for costs and it was not opposed by the applicant. The sixth respondent sought an order for costs which was opposed. Counsel for the first to fourth respondents informed me that he wished to make an application 'for an unusual costs order' but said no more at that time about its character. I made the following order and directions: 'THE COURT ORDERS THAT: 1. The applicant pay the costs of the fifth respondent including reserved costs, as agreed or taxed. THE COURT DIRECTS THAT: 1. The first to fourth and sixth respondents file any evidence and written submissions on which they wish to rely on the issue of costs by 4pm on 28 March 2008. 2. The applicant file any evidence and written submissions in response on the issue of costs by 4pm on 24 April 2008. 3. Matter is listed for hearing on the issue of costs at 10:15am, on 3 June 2008 on the respondents' estimate of half a day.' 5 The first to fourth and sixth respondents did not comply with Direction 1. The applicant remained silent. On 28 May 2008, two months in breach of the timetable which was fixed in consultation with the parties, and which allowed more time to the respondents than had been sought, the solicitors for the first to fourth and sixth respondents wrote asking to vacate the date fixed for hearing on 3 June 2008. That request was not agreed to by the applicant. As a consequence the hearing has gone ahead today. 6 At the hearing of the matter this morning I refused leave to Mr Robinson, who appeared for the first to fourth and sixth respondents, to file in court a further affidavit from Mr Lahood, the sixth respondent, in support of an application for costs. I also declined to receive into evidence two letters which he sought to tender. I did so because the respondents were in serious and unjustified breach of the orders made on the last occasion. I was not prepared merely to overlook the matter. Had I done so a further opportunity would need to be given to the applicant to marshal some evidence in reply. The disposition of the proceedings would have been further delayed. I am satisfied such a course of events should be avoided. 7 Mr Robinson nevertheless sought an order for the costs of the first to fourth and sixth respondents (excluding costs of the notices of motion to strike out which were earlier agreed) on an indemnity basis. He sought, further, that Mr Ardino, solicitor for the applicant, be made personally liable for the costs. 8 The application raises the following questions for determination: