FEDERAL COURT OF AUSTRALIA Pacific Air Freighters (Qld) Pty Ltd v Toller [2000] FCA 343 PACIFIC AIR FREIGHTERS (QLD) PTY LTD ACN 064 184 372 v MICK TOLLER, KARL VICTOR WALLY AND CIVIL AVIATION SAFETY AUTHORITY Q 8 of 2000 DRUMMOND J 20 MARCH 2000 BRISBANE IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 8 OF 2000 BETWEEN: PACIFIC AIR FREIGHTERS (QLD) PTY LTD ACN 064 184 372 APPLICANT AND: MICK TOLLER FIRST RESPONDENT KARL VICTOR WALLY SECOND RESPONDENT CIVIL AVIATION SAFETY AUTHORITY THIRD RESPONDENT JUDGE: DRUMMOND J DATE OF ORDER: 20 MARCH 2000 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The notice of motion be dismissed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 8 OF 2000 BETWEEN: PACIFIC AIR FREIGHTERS (QLD) PTY LTD ACN 064 184 372 APPLICANT AND: MICK TOLLER FIRST RESPONDENT KARL VICTOR WALLY SECOND RESPONDENT CIVIL AVIATION SAFETY AUTHORITY THIRD RESPONDENT JUDGE: DRUMMOND J DATE: 20 MARCH 2000 PLACE: BRISBANE REASONS FOR JUDGMENT 1 I have before me a motion seeking an order under O 9 r 3 the Federal Court Rules that the applicant company be granted leave to be represented without a solicitor on the record and a further order that it be granted leave in effect to be represented by the gentleman described as its in-house counsel, Dr Broadbent. The application refers to O 9 r 3, which relates to circumstances in which a corporation may defend by leave otherwise than by a solicitor. The rule that the applicant needs to invoke, however, is O 4 r 14(2), which provides that: "Except as provided by or under any Act, a corporation may not, without the leave of the Court, commence or carry on any proceeding otherwise than by a solicitor." 2 The principles upon which leave under the rule may be granted are discussed in a number of cases. I refer only to Simto Resources Ltd v Normandy Capital Ltd reported in 10 ACSR 776. French J, in that decision, pointed out that one of the detriments that people who choose to take advantage of the system of incorporation to carry on business by means of a corporate vehicle suffer is that the Court will ordinarily require a corporation to carry on proceedings by a solicitor on the record. 3 At 782, French J deals with the sort of matters which courts commonly take into account in determining whether an application such as the present should be granted. The discretion is a broad one. An important consideration is the corporate applicant's reason for not retaining a solicitor. Whether there is some financial incapacity or problem or difficulty that prevents the company from engaging a solicitor to conduct the litigation it wants to bring before the Court is an important consideration. Financial considerations also require, in an appropriate case, as I think this is, an examination of why those who stand behind the company, the shareholders in particular, as the people who will benefit from the company's litigation if it is successful, are also not prepared to put the company in funds to provide for legal representation. 4 They are but two of the matters which can be (and are here) relevant. Other issues concern the complexity of the issues involved. They are but some of the matters that may, in a particular case, require consideration before a determination can be made by the Court on whether leave should be granted to a company to be represented by someone other than a solicitor. 5 The applicant company has a substantial paid up capital with three substantial shareholders involved. Dr Broadbent is the only director and the major shareholder. He has also recently become legally qualified and has been admitted to the Bar. The case, as it is now proposed to be run under the amended application handed up to the Court today, involves a challenge to the way in which the Civil Aviation Safety Authority administered certain provisions of the Civil Aviation Act 1988 (Cth) and denied the company renewal of the Air Operator's Certificate which it had hitherto held. 6 The issues raised by the amended application do, I think, involve some fairly complex issues, and I am not at all satisfied that Dr Broadbent is in a position of being able to present the case in proper fashion, that is, in the way in which the Court would require it to be presented with concentration on the critical issues and with expedition. He, in fact, acknowledges as much in his affidavit filed in support, where he refers to the prolixity of the original application as being due to his inexperience, to him having inappropriately included in the affidavit material supporting the original application much material which is largely irrelevant to the issues the Court will have to determine. He also puts before the Court a letter from his solicitors in which they express some criticism of the sufficiency of Dr Broadbent's statement of facts, issues and contentions to encapsulate the matters relevant to the determination the Court is asked to make. 7 It is apparent from the statement of facts, issues and contentions, which Dr Broadbent has prepared and filed in compliance with a direction I earlier gave, that there is a range of factual matters which will need to be agreed, or, if not agreed, established by evidence before the questions of law central to the dispute can sensibly be resolved. There may not be a large area of factual dispute, at the end of the day, ie, by the time the hearing commences. But the possibility remains that there may be an area of factual dispute, and the dealings between Pacific Air Freighters and the Civil Aviation Safety Authority were conducted in relevant part by Dr Broadbent personally. I do not, however, set a great deal of store on the fact that Dr Broadbent may be in the situation of both advocate and witness if the application were to be granted, though it is one consideration that I do take into account. 8 So the position is that there is simply no material before the Court on the important issue of the financial capacity of the application to fund legal representation other than that produced by the respondent who opposes the application. Its material shows, as I have said, that the company has a substantial paid up capital. Secondly, the issues for determination involve matters of some considerable legal complexity, and I have reservations about whether Dr Broadbent, notwithstanding his recent legal qualifications, is in a position to properly present the applicant's case, given the matters I have referred to and, in particular, the lack of focus displayed by Dr Broadbent in preparing the material originally put before the Court in support of the application. 9 There is also a possibility, exacerbated to some extent by the attitude of the parties to each other, in which there is a degree of hardening of attitudes on both sides, that the Court may have to determine some contentious factual matters, and if that happens, Dr Broadbent will almost certainly be in the position of witness as well as advocate if the application were to be granted. That, in the circumstances of the case, would be an immensely undesirable situation. 10 There is a further consideration arising from the application that Dr Broadbent be given leave to represent the company and the reliance placed on Dr Broadbent being legally qualified. Reference was made to the duties of counsel to the Court and I was referred to Grimwade v Meagher [1995] 1 VR 446, particularly at 452 and 453. That was a case in which the Court took the most unusual step of enjoining particular counsel from continuing to appear as prosecutor in a criminal case, there being real questions as to whether he would act with proper objectivity in presenting the case. 11 This is not, of course, a case in which the Court would be justified in enjoining Dr Broadbent from representing the company and counsel for the respondent acknowledges that. No such question, of course, arises because before it could, Dr Broadbent would have to succeed in obtaining the leave sought today to represent his company. But there is some substance in the proposition advanced by counsel for the respondent that, given Dr Broadbent's close involvement as a director of the company and in its flying operations, out of which the dispute arises, there is a real question as to whether he would be in a position, if granted leave to appear as advocate for the company, to display the objectivity expected from a legal practitioner. 12 The motion will be dismissed. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Drummond. Associate: Dated: 23 March 2000 Counsel for the Applicant: The applicant appeared in person Counsel for the Respondent: Mr B Porter Solicitor for the Respondent: Mallesons Stephen Jaques Date of Hearing: 20 March 2000 Date of Judgment: 20 March 2000