Valassis v M D Nikolaidis & Co.

THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

13998/88 VALASSIS v M D NIKOLAIDIS & CO. Judgment HER HONOUR : 1 By notice of motion filed on 19 October 1999, the applicant, identified as M D Nikolaidis & Co., (a firm of solicitors) seeks an order, pursuant to s 84(2) of the Supreme Court Act 1970: "That the plaintiff [Dennis Valassis] obtains the ex parte leave of a Master or Judge prior to filing any further document in this Court in relation to these proceedings, the related proceedings to the Court of Appeal being No.40089 of 1996, or in any fresh proceedings brought by the plaintiff in relation to the subject matter of these and the said Court of Appeal proceedings." 2 The applicant also seeks orders that the respondent/plaintiff pay the applicant's costs of the notice of motion on an indemnity basis or alternatively on a party/party basis and that such costs be paid within fourteen days after agreement or assessment. 3 The source of the power to make the first order sought is s 84(2) of the Supreme Court Act, which is in the following terms: "(2) Where any person (in this subsection called the vexatious litigant) habitually and persistently and without any reasonable ground institutes vexatious legal proceedings against any person (in this subsection called the person aggrieved), whether in the Court or in any inferior court, the Court may, on application by the person aggrieved, order that the vexatious litigant shall not, without leave of the Court, institute any legal proceedings against the person aggrieved in any court and that any legal proceedings instituted by the vexatious litigant against the person aggrieved in any court before the making of the order shall not be continued by the vexatious litigant without leave of the Court." 4 It is to be observed that the power to make the order sought exists only where it is found that a person "habitually and persistently and without any reasonable ground institutes vexatious legal proceedings …" The precise ambit of this clause is critical to the outcome of the application. 5 On the application Mr Jones appeared for the applicant. Mr Valassis represented himself. 6 These proceedings have a very long and rather involved history, which, even after extensive analysis, is not entirely clear. It has been necessary to attempt a chronology of relevant events and Identification of the numerous applications that have been made. The narrative which follows has been drawn in part from various judgments that were placed before me, and from the court file, which now stands many centimetres high, as well as from the affidavit and oral evidence specifically referable to the application. 7 The initial proceedings were commenced on 12 August 1988, when the plaintiff, Mr Dennis Valassis, filed in this Division a summons which was given the number 13998/1988, in which he sought taxation of six bills of costs rendered by the applicant (to whom I will refer compendiously as Nikolaidis) in respect of legal work performed by Nikolaidis on Mr Valassis' behalf. The total of the sixteen bills was $12,478.90. This amount had been paid by Mr Valassis prior to the filing of the summons. 8 It appears that the summons was out of time and not in proper form. It was listed for the first time in 28 February 1990 when, notwithstanding the apparent time bar, Nikolaidis agreed to participate in the taxation. Thereafter, a variety of interlocutory applications were made by Mr Valassis. Included in these was a 1992 preceding alleging contempt against Nikolaidis for failing to produce files in accordance with orders made by the Prothonotary. (The source of this information is a judgment of Deputy Registrar Howe dated 24 August 1995, part of Ex A. I have found no further detail of the contempt proceeding, or its fate.) 9 The hearing of the taxation commenced before Deputy Registrar Sanderson on 25 May 1993, that is, almost five years after the summons was filed. On 13 July 1993 Mr Sanderson delivered a decision in relation to a costs agreement between the parties. Pursuant to SCR Pt 61 r 3 Nikolaidis sought review of the decision. On 2 November 1993 Master Malpass reviewed the decision and ordered that it be discharged and the taxation proceed. 10 On 7 June 1994 the application came before Senior Taxing Officer Williams who made certain rulings and gave directions as to the future progress of the matter. According to the judgment of Deputy Registrar Howe, Mr Valassis then, on 20 October 1994, filed a further notice of motion. The orders sought, as recounted in the judgment are somewhat puzzling. Mr Valassis sought a stay of proceedings, based upon non compliance by Nikolaidis with directions given on 7 June. This is puzzling because the proceedings sought to be stayed were Mr Valassis' own proceedings against Nikolaidis. However, he also sought an order that Nikolaidis repay the entirety of the costs that had been paid and that were the subject of the proceedings. The motion came on for hearing before Deputy Registrar Howe on 5 December 1994. The parties then agreed to proceed to taxation, for which three days were set aside, commencing either in December 1994 or in January 1995. On the first day Mr Valassis declined further to participate and withdrew. He then filed another notice of motion in terms similar to that filed on 20 October 1994. That notice of motion also came on for hearing before Master Malpass who stood it over generally and referred the file to Deputy Registrar Howe to continue the taxation. That proceeded on 27 July 1995. Deputy Registrar Howe completed the hearing and delivered a determination. He ordered that $1,888.42 be taxed off the total of the six bills of costs. In accordance with the then operative legislation and because the amount taxed off was less than one sixth of the total of the bills rendered, he ordered Mr Valassis to pay the costs of the taxation. 11 On 7 August 1995 Mr Valassis filed a request for reconsideration. On 24 August, having reconsidered the matter, Deputy Registrar Howe decided to maintain his earlier decision and ordered that a certificate in accordance with that decision issue. 12 Pursuant to SCR Pt 52 r 62 Mr Valassis sought review of the reconsideration and this application came before Master Greenwood. Mr Valassis was unsuccessful, no alteration was made to the certificate issued by Deputy Registrar Howe, and Mr Valassis was ordered to pay Nikolaidis' costs of the review. 13 In March 1996 Mr Valassis issued a summons for leave to appeal to the Court of Appeal from the decision of Master Greenwood. On 29 March 1996 that Court, constituted by Handley and Cole JJA dismissed the application. On or about 3 April 1996 Mr Valassis applied to the High Court of Australia for special leave to appeal against the dismissal of the summons. No evidence of the outcome of that application was placed before me. I am prepared to assume that special leave has not been granted. 14 On 11 April 1996 Mr Valassis filed a notice of motion in the Court of Appeal in which he sought, inter alia, the following orders: "1. That the decision of the proceedings No CA40089 of 1996, CLD 13998 of 1998 heard in this Honourable Court on 25 March 1996 before their Honours Messrs Justice Handley JA and Cole JA, judgment released on 29th March, 1996, be reconsidered on the following grounds: …"

There followed a long list of assertions and arguments supposedly identifying error in the approach taken by Master Greenwood. On 3 May 1996 the Court of Appeal, constituted as before, refused the orders sought in the notice of motion and directed entry of the order forthwith. 15 On 16 and 28 July 1998 Mr Valassis filed further notices of motion in the Court of Appeal seeking leave to re-open and adduce fresh evidence in relation to the notice of motion already disposed of. The precise terms of these motions are not in evidence before me. They came before Handley JA on 3 August 1998. His Honour dismissed both, saying, inter alia: "This is an application by Mr Valassis for a third hearing of his application for leave to appeal from a decision of Master Greenwood on 22 November 1995. … It is apparent that this application is not supported by any material which was not known to Mr Valassis, or with reasonable diligence, could not have been known to him, prior to the first of the hearings of this Court in March 1996. It is now some two and a half years since the first of those decisions of this Court. The present applications are completely hopeless and the Court is not obliged to impose a lengthy hearing on the opponent, or to spend further time in hearing completely hopeless applications." 16 The very next day, 4 August 1998, Mr Valassis filed a further notice of motion in the Court of Appeal, again seeking identical orders to those sought before and refused by Handley JA. On 17 August 1998 this notice of motion came before Registrar Jupp who dismissed it and ordered Mr Valassis to pay the costs incurred by Nikolaidis. 17 On 19 August 1998 Mr Valassis filed another notice of motion in the Court of Appeal. The terms of that notice of motion are not before me. It came before Mason P who dismissed it, saying, inter alia: "I am quite satisfied that Mr Valassis is endeavouring to ventilate again the very same matter that was dismissed by Handley JA and Cole JA and to rely in substance upon the same arguments and the same material which either he put before the Court then or sought to put before the Court then. I am also satisfied that that is material which was available to him at the time of the review by the Master. … I indicated during the course of the oral submissions that I permitted Mr Valassis to make that there comes a time when the repeated filing of process in a Court must be viewed by the Court as an indication by the party filing those proceeding that that party holds the Court's process in contempt. I am quite satisfied that the present application is an abuse of process. I would repeat the warning which I gave to Mr Valassis in the course of argument that he is in my view at risk of showing himself to be in contempt of the Court by these repeated applications. I would also indicate that the Court has the power to refer the papers to the Attorney General for the purpose of an application being made that Mr Valassis be declared a vexatious litigant. I am reluctant to do that. I would like to thing[sic] that Mr Valassis is simply misguided in his understanding of Court processes, but there comes a time when the Court can explain the matter in words of one syllable and can only infer that if the explanation is not understood it is because of refusal to understand rather than simple ignorance. I think that stage has now been reached." 18 On 16 August 1999 Mr Valassis filed yet another notice of motion, this time in this Division. The orders he then sought were in the following terms: "1. With Part 52 Rule 63 the Court to issue Judgement to the decision of the Taxing Officer, Mr Bruce Howe, exercising the jurisdiction in the Supreme court of New South Wales, Common Law Division with Taxation No.013998 of 1988 that the Defendant pay the Plaintiff $1,888.42, with interest issued on/after 11.8.95. As less than 1/6 of the bills was taxed the Plaintiff to pay the Defendant's costs of the taxation. 2. The Notice to Judgment Debtor of Writ of Execution (Pt30 r.3(2)) issued in the Local Court (Civil Claims) Act 1970, Level 5, the Downing Centre, 143-147 Liverpool Street, Sydney in the State of New South Wales, File No.5412 of 1999, from the Certificate as to Determination of Costs, Legal Profession Act 1987 (the Act), Section 208F, 208J, Assessment of Party Party Costs No.C/L 91912 of 1997, came from Taxation File No. 013998 of 1988, to be set aside. 3. Such further orders as this Honourable Court deems fit. 4. Costs." 19 This notice of motion appears to have been precipitated by a most unfortunate error on the part of Nikolaidis. So far as I can ascertain, what happened is this. Following the final determination of the Court of Appeal, Nikolaidis took proceedings for enforcement of the various costs orders made against Mr Valassis. This resulted in a judgment against Mr Valassis in a sum of something over $4,000. Mr Valassis was entitled, in relation to the sum assessed in relation to the costs of the various proceedings, to be given credit for the $1,888.42 by which the original six bills of costs had been reduced pursuant to the order of Deputy Registrar Howe of 24 August 1995. Regrettably, Nikolaidis omitted to give that credit and judgment was entered against Mr Valassis on 18 May 1999, in an amount that failed to recognise his entitlement to that reduction. That error sparked a fresh round of correspondence and applications. On 10 August Mr Valassis wrote to Nikolaidis asking why they had not advised him of the judgment, and asking if Nikolaidis would consent to his paying the full amount five weeks later, on 13 September, but also advising of his intention to lodge an application to pay by instalments. On 19 August Nikolaidis wrote back to Valassis acknowledging the error and advising that they had written to "the Taxing Officer" asking that the error be rectified. (At the hearing it was pointed out that the reference to the "Taxing Officer" was another error and should have read "Sheriff".) On the same day Nikolaidis wrote to the Sheriff's office advising of the correction to the amount owing. They sent a copy of this letter to Mr Valassis. 20 The letters acknowledging the mistake, both to Mr Valassis and to the Sheriff, post dated the notice of motion filed by Mr Valassis on 16 August. In written submissions the solicitor for Nikolaidis conceded the legitimacy of the claim made in that notice of motion at the time it was filed, but contended that subsequent rectification of their mistake obviated the need for Mr Valassis to pursue it. 21 The notice of motion was listed before Deputy Registrar Haggett on 7 October 1999. After hearing submissions from both parties the Deputy Registrar dismissed the notice of motion and reserved costs. 22 This history is completed, so far as the evidence goes, by reference to two final notices of motion filed by Mr Valassis. The first was filed in the Court of Appeal on 19 October 1999. Mr Valassis sought an order in the following terms: "The Claimant to have leave with fresh evidence that the decision of the proceedings No CA 40089 of 1996 heard on 25th March 1996, judgment issued on 29th March, 1996, and the decision of the Notice of Motion heard on 3rd May 1996 before their Honours Messrs Justices Handley JA and Cole JA, and the Notice of Motion heard before his Honour Justice Mason P on 7th September 1998 to be reconsidered, and allow the claimant to give evidence with full report, chronology and points of law. This Notice of Motion to be set for hearing before his Honour Mr Justice Mason P."

The notice of motion then contained lengthy assertions of errors alleged to have been made by the Court as constituted by Master Greenwood, the Taxing Officer, Mr Jupp and the Court of Appeal. 23 The last notice of motion was filed in the Local Court on 25 October 1999. Mr Valassis claimed orders framed as follows: 1. Mr Ian Robert Durston Jones, solicitor acting for Judgment Creditor, on 8th October, 1999 misled the Magistrate Mr Price with incorrect report and irrelevant documents, and His Worship ordered $500 costs. The costs to Judgment Creditor to be withdrawn. 2. Such further orders as this Honourable Court deems fit. 3. Costs." 24 This notice of motion was made returnable on 17 December 1999. There is no evidence as to what occurred on that date. 25 It is quite plain from the foregoing history that Mr Valassis is unprepared to accept any adjudication of this or any other Court that is unfavourable to him. He constantly seeks to re-litigate issues that have been finally determined against him. Nikolaidis have been put to a great deal of expense and inconvenience in defending his repeated applications all of which, however framed, centre around the same issue. The application by Nikolaidis calls into question the extent to which s 84(2) is adequate to meet the circumstances of this case. That is because the subsection depends upon proof of the habitual, persistent and unreasonable institution of vexatious legal proceedings. On one view of what has happened, Mr Valassis has instituted merely one legal proceeding, that having occurred with the filing of the original summons. Almost all notices of motion to which I have referred have been filed in that single proceeding. The various Court of Appeal applications are also referable to that proceeding. Besides those matters, there is the single Local Court application to which I have referred. 26 There is authority to the effect that the initiation of interlocutory applications does not amount to the institution of proceedings: Hunters Hill Municipal Council v Pegler [1976] 1 NSWLR 478, per Yeldham J. However, as Yeldham J held in that case, the correct approach is not merely to look at the process by which an application is made; it is necessary to consider the substance of each application. When that is done in the present case it can readily be seen that, except for the application of 16 August 1999, but including that made to the Local Court in October 1999, and that made to the Court of Appeal on 19 October 1999, that the substance is in each case identical. Mr Valassis is seeking to litigate and re-litigate the taxation of costs that was completed by Deputy Registrar Howe on 14 August 1995 and was finally disposed of by the Court of Appeal of Appeal on 29 March 1996, 3 August 1998, and ultimately, by Mason P on 7 September 1998. 27 These applications should therefore be characterised, however they are dressed up, as the institution of proceedings. They are plainly repetitive and vexatious and accordingly come within the section. The history demonstrates, quite conclusively, that this is a suitable case for the exercise of the power under s 84(2). It is true that the notice of motion filed on 16 August 1999 was in a different category to the others, and, had the trail of applications there ceased, I would have been reluctant to make the order sought. That is because a fairly long application-free interlude followed the decision of Mason P. But the most recent notice of motion filed in the Court of Appeal on 16 November 1999 is disturbing evidence of a revival of the energies Mr Valassis has devoted to the struggle. I am satisfied that a proper basis for an order has been established and that the discretion should be exercised in favour of Nikolaidis. I am further satisfied that the case calls for an award of costs on an indemnity basis. Accordingly, I make the following orders:

1. The plaintiff, Dennis Valassis, shall not, without leave of the Court, institute any legal proceedings against M D Nikolaidis and Co. in any Court and shall not continue any legal proceedings already instituted against M D Nikolaidis and Co. in any Court without the leave of the Court.

2. I order Dennis Valassis to pay the costs of this application, and that the costs be assessed on an indemnity basis. **********

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