On 9 November 2015 the company filed a summons seeking leave to appeal from the interlocutory orders made on 12 October 2015. Leave to appeal was required by s 101(2)(e) of the Supreme Court Act 1970 (NSW). On 2 December 2015 an amended summons was filed, extending the application for leave to include the orders made on 16 and 18 November 2015. The first of those was also interlocutory. Leave was required to appeal from the later order because it dismissed the company's application under s 459G of the Corporations Act 2001: Supreme Court Act 1970, s 101(2)(p).
The proceedings for leave in this Court also have not been commenced by a solicitor, and at the hearing of the application the Court granted Mr Tydeman leave to appear on behalf of the company for the purpose only of making that application. We did so to enable the Court to deal with the application having considered all of the submissions he sought to make on the company's behalf.
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Does the proposed appeal have arguable prospects of success?
To justify a grant of leave to appeal the company must, as a starting proposition, demonstrate that the primary judge was arguably wrong to conclude that the proceedings before him were commenced and carried on by the company contrary to r 7.1. The relief sought by the amended summons, and Mr Tydeman's submissions, make clear that that is the question of principle which Tanamerah seeks to agitate on any appeal.
By that amended summons Tanamerah seeks declarations that, in commencing the proceedings before the primary judge and in this Court as a director who was properly authorised in accordance with r 7.2(1), Mr Tydeman acted "in accordance with the legal meaning of the defined word 'plaintiff' as fixed by CPA s 3".
Three affidavits of Mr Tydeman were sought to be read in support of the application. Only the affidavit sworn on 17 February 2016 was objected to. We rejected the reading of that affidavit in its entirety. It is not directed to any matter which is remotely relevant to the principled disposal of the leave application.
The essence of the argument which Mr Tydeman seeks to make on the company's behalf is recorded in para 1 of its Summary of Argument dated 9 November 2015:
The nature of Tanamerah's case is to have formally remedied all of the malfeasance and/or misfeasance [of] the Supreme Court (including the Court of Appeal) has inflicted on it by the court's continual persistence to perpetuate the myth that the relevant and cascading definitions for "person under legal incapacity", "tutor" and "plaintiff" requires, in relation to UCPR r 7.1(3), the properly authorised director, as contemplated by UCPR r 7.2, must have a personal claim in his or her own right before that appointed and authorised representative may also act on the company's behalf to "commence" legal proceedings in the Supreme Court in accordance with UCPR r 7.1(2)(a). [emphasis added]
The reference in this passage to "all of the malfeasance and/or misfeasance [of] the Supreme Court" is, we think, to earlier decisions of the Court rejecting, or doubting the correctness of, arguments made by Mr Tydeman as to why, once he was duly authorised to commence proceedings as a director of the company, he was a "plaintiff" in those proceedings for the purpose of r 7.1(3), and notwithstanding that he was not named as such for the purpose of pursuing a cause of action which he personally had against the relevant defendant. Those decisions include Tanamerah Estates Pty Ltd v Tibra Capital Pty Ltd [2013] NSWSC 36 (Hallen J); Tanamerah Estates Pty Ltd v Tibra Capital Pty Ltd (No 2) [2013] NSWSC 616 (Hallen J); Tanamerah Estates Pty Ltd (as trustee for Alexander Superannuation fund) v Tibra Capital Pty Ltd [2013] NSWCA 266 (Basten JA, Sackville AJA); the two decisions of the primary judge; and Tanamerah Estates Pty Ltd v Tibra Capital Pty Ltd [2015] NSWCA 383 (Leeming JA).
It is convenient at this point to set out the three definitions in s 3(1) of the CPA to which the argument refers:
person under legal incapacity means any person who is under a legal incapacity in relation to the conduct of legal proceedings (other than an incapacity arising under section 4 of the Felons (Civil Proceedings) Act 1981) and, in particular, includes:
(a) a child under the age of 18 years, and
(b) an involuntary patient, a forensic patient or a correctional patient within the meaning of the Mental Health Act 2007, and
(c) a person under guardianship within the meaning of the Guardianship Act 1987, and
(d) a protected person within the meaning of the NSW Trustee and Guardian Act 2009, and
(e) an incommunicate person, being a person who has such a physical or mental disability that he or she is unable to receive communications, or express his or her will, with respect to his or her property or affairs.
plaintiff means a person by whom proceedings are commenced, or on whose behalf proceedings are commenced by a tutor, and includes a person by whom a cross-claim is made or on whose behalf a cross-claim is made by a tutor.
…
tutor, in relation to a person under legal incapacity, means a tutor appointed to represent the person (whether by the court or otherwise) in accordance with the uniform rules.
The company's argument is put in two ways. The first proceeds as follows: a company answers the description of a "person under legal incapacity" as defined in CPA, s 3; when a person is granted the right to act in legal proceedings on behalf of such a person, the first person, in exercising his or her right to so act, answers the description of a "tutor", because he or she is "appointed to represent the person (whether by the court or otherwise) in accordance with the uniform rules"; someone appointed as a "tutor" does not need to have a personal claim in order to exercise that right of representation; and finally, if a person answering the description of a "tutor" commences proceedings on behalf of the "person under legal incapacity", the first person is a "plaintiff" within the meaning of that word as defined in s 3, because he or she is a "person by whom proceedings are commenced".
The second way the argument is put is that r 7.2(2) proceeds on the basis that a company may authorise a director to "commence" legal proceedings on its behalf. The requirement in r 7.1(3) that the director also be a "plaintiff" is satisfied if the proceedings are commenced by that director in accordance with r 7.1(2)(a), because in doing so that director answers, in relation to those proceedings, the description of "a person by whom proceedings are commenced": CPA, s 3(1).
The same or very similar arguments were made by Mr Tydeman on behalf of the company to the primary judge ([2015] NSWSC 1519 at [8]-[10]), and to Basten JA and Sackville AJA ([2013] NSWCA 266 at [14]-[20]). In our view each argument is misconceived.
As to the first: the company does not answer the description of a "person under legal incapacity" as that term is defined in s 3. As Basten JA (Sackville AJA agreeing) concluded at [18]-[20], the concept of a "person under legal incapacity" as that expression is defined in the CPA is concerned with individuals and not artificial entities. If that was not so, as Basten JA observed, the consequence would seem to be that every company would be required to sue through a "tutor" in all cases; and we add, the tutor, unless the Court ordered otherwise, would have to commence and carry on the proceedings by a solicitor: UCPR, r 7.14. In support of his argument, Mr Tydeman makes reference to the definition of "person" in s 21(1) of the Interpretation Act 1987 (NSW). However, that definition does not apply where, as here, the "contrary intention appears … in the Act or instrument concerned": s 5(1).
There are other difficulties for this argument. Mr Tydeman was authorised to pursue the litigation in his capacity as director and as the company's agent, but not as a "tutor". A "tutor" may not commence or carry on proceedings unless there have been filed the tutor's consent to act as such and a certificate from the tutor's solicitor in the proceedings to the effect that the tutor does not have any interests in the proceedings adverse to that of the person under legal incapacity: UCPR, r 7.16. This is because, as Basten JA also observed (at [17]), a "tutor" does not pursue any personal interest or cause of action in the proceedings. For that reason, a tutor could not be a "plaintiff" for the purposes of r 7.1(3).
These observations suggest, correctly in our view, that r 7.1(3) requires the director "plaintiff" to have a cause of action which may properly be pursued in the same proceedings. This construction accords with the ordinary meaning of the language. It has been adopted in the first instance decisions cited by Basten JA at [15]; and is not contradicted by what Handley AJA said in May v Christodoulou [2011] NSWCA 75; 80 NSWLR 462 at [8]. (See also [2015] NSWCA 383 at [9]-[10] per Leeming JA.)
In our view neither of these arguments as to why the requirements of r 7.1(3) had been satisfied by Tanamerah in this case has any realistic prospects of success.
In addition to those arguments, Tanamerah's submissions identify three further respects in which it is suggested the primary judge may have erred in dismissing its application. They are that in doing so the Court acted contrary to s 467A of the Corporations Act 2001; that the making of the orders on 16 and 18 November 2015 in circumstances where there was an application for leave to appeal from the earlier orders constituted an "irregularity" within s 63(1) of the CPA; and that the making of the order dismissing the company's application was "against ss 56(1), 57(1)(a) and 58(2)(b)(vi)" of the CPA because no account was taken of the injustice that would or might be suffered by the company as a result of the making of that order.
As to the first, s 467A of the Corporations Act 2001 provides that an application under Pt 5.4 (which includes s 459G) must not be dismissed "merely" because of a defect or irregularity in connection with the application unless the Court is satisfied that "substantial injustice has been caused that cannot otherwise be remedied (for example, by an adjournment or an order for costs)". In our view that prohibition had no application to the making on 18 November 2015 of the order dismissing the proceedings. That order was not made "merely" because the proceedings had been commenced contrary to r 7.1. The issue as to compliance with that rule was determined adversely to the company by the judgment of 12 October 2015. The prejudice that might otherwise have followed from the dismissal of the proceedings at that point was recognised and accommodated by an adjournment to permit the company to cure the defect or irregularity by obtaining legal representation.
As to the second matter, s 63 of the CPA was not engaged in the way suggested. There was no failure on the part of the primary judge to comply with any requirement of the Act or rules, whether in respect of time, place, manner, form or content. The fact that an application for leave to appeal had been filed on 9 November 2015 did not operate as a stay of the effect of the earlier orders and the primary judge was justified in proceeding to give effect to them.
As to the third, the primary judge considered Mr Tydeman's submission that the dismissal of the proceedings would deprive Tanamerah of an opportunity to have its application under s 459G dealt with on the merits. His reasons for rejecting that argument do not reveal error. He concluded that what deprived the company of the opportunity for that hearing was "the decision it has itself made not to retain qualified legal representation": [2015] NSWSC 1708 at [5]. Its application under s 459G was subject to the UCPR and once the difficulty caused by the absence of a legal representative was pointed out, an opportunity was given to the company to comply with the rules. It chose not to do so in circumstances where it was not suggested that it could not have done so had it decided otherwise.
Finally, it is necessary to address briefly the matters raised by the company's draft notice of appeal. That proposed notice does not comply with UCPR r 51.18(1)(e), which requires that a notice of appeal state "briefly, but specifically, the grounds relied on in support of the appeal". It consists of 91 paragraphs of submissions in support of 29 asserted errors by the primary judge. In the company's Summary of Argument (para 10) those paragraphs are described as capturing "in detail, the essence of Tanamerah's substantive and supported arguments". The substance of those arguments, as we understand them to be made, has been addressed above.
The draft Notice of Appeal goes well beyond questions as to the proper construction of rr 7.1 and 7.2. It includes broad assertions as to purportedly related errors. Many of those assertions are made without any principled legal foundation or justification whatsoever. They include that, in "crafting an imperfect judgment", the primary judge attempted "to pervert the course of justice"; that, in following earlier decisions as to the interpretation of rr 7.1 and 7.2, the primary judge attempted "to threaten, intimidate or judicially bully" the company; and that the primary judge was "affected by actual bias, or [that] there would be an apprehension of bias", because in June 2013 he had delivered a paper addressing issues of law and practice in the Corporations List of the Court that referred to r 7.1(3) and the decisions which to that point in time had considered its application and effect.
The company's proposed appeal does not have any arguable prospects of success. We agree with the respondent's submission that none of the asserted 29 errors of the primary judge justifies a grant of leave to appeal. For that reason the amended summons seeking leave to appeal is dismissed with costs.
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Decision last updated: 01 March 2016
By a motion filed on 1 October 2015, Tibra sought a declaration that Tanamerah was not entitled to commence and carry on the proceedings because it had not complied with Uniform Civil Procedure Rules 2005 (UCPR), Pt 7, Div 1, r 7.1. It also sought orders that the proceedings be stayed for a period following which, if the rule had not been complied with, they would be dismissed.
Rules 7.1 and 7.2 relevantly provide:
7.1 By whom proceedings may be commenced and carried on
(1) A natural person may commence and carry on proceedings in any court, either by a solicitor acting on his or her behalf or in person.
…
(2) A company within the meaning of the Corporations Act 2001 of the Commonwealth:
(a) may commence and carry on proceedings in any court by a solicitor or by a director of the company, and
…
(3) In the case of proceedings in the Supreme Court, subrule (2)(a) authorises a company to commence proceedings by a director only if the director is also a plaintiff in the proceedings.
7.2 Affidavit as to authority to commence and carry on proceedings in Supreme Court or District Court
(1) A person who commences or carries on proceedings in the Supreme Court or District Court:
(a) as the director of a company within the meaning of the Corporations Act 2001 of the Commonwealth, or
…
(2) The affidavit made by the director of a company within the meaning of the Corporations Act 2001 of the Commonwealth must contain:
(a) a statement to the effect that:
(i) the director is a director of the company, and
(ii) the director has been authorised by a resolution of the directors duly passed at a meeting of directors held on a specified date (which must not be earlier than 21 days before the date of the affidavit) to commence and carry on the proceedings, as the case requires, and
(iii) the authority has not been revoked, and
(iv) the director is aware that he or she may be liable to pay some or all of the costs of the proceedings, or
…
The primary judge (Black J) on 12 October 2015 ordered that the proceedings be stayed to 4pm on 16 November 2015 to enable Tanamerah to obtain legal representation and for a legal representative to enter an appearance on its behalf: Tanamerah Estates Pty Ltd v Tibra Capital Pty Ltd [2015] NSWSC 1519. The matter was relisted on that day to determine whether, if no legal representation had been obtained, the proceedings should be dismissed.
On 16 November 2015 Mr Tydeman indicated to the Court that Tanamerah did not propose to retain a solicitor. No application was made under s 14 of the Civil Procedure Act 2005 (NSW) (CPA), either at that time or earlier, to dispense with the requirements of UCPR, r 7.1. This was so notwithstanding that the primary judge had raised the possibility of such an application being made (tcpt 12/10/15, p 13). Nor was any evidence led or submissions made to explain why the company was not or could not be represented by a solicitor, or to suggest that the company and/or Mr Tydeman did not have the financial resources to secure such representation.
Mr Tydeman submitted to the primary judge that the Court should not dismiss the proceedings because to do so would deprive the company of the opportunity for a hearing of its application on the merits and would expose it to the making of a winding-up order. The primary judge rejected that argument. The company would only be deprived of that opportunity if it chose not to comply with the UCPR. His Honour then directed Tanamerah to file a notice of appearance of a legally qualified representative by 4pm on that day. He noted that, if the direction was not complied with, he proposed to make an order in chambers dismissing the proceedings: Tanamerah Estates Pty Ltd v Tibra Capital Pty Ltd [2015] NSWSC 1708. No such notice was filed and on 18 November 2015 the primary judge ordered that the proceedings be dismissed with costs.