Croker v Philips Electronics Australia Limited [2000] FCA 991

FEDERAL COURT OF AUSTRALIA

Croker v Philips Electronics Australia Limited [2000] FCA 991 PRACTICE AND PROCEDURE – pleadings – whether reasonable cause of action pleaded – whether statement of claim should be struck out – whether leave to replead should be granted

Trade Practices Act 1974 (Cth) CLAYTON ROBERT CROKER v PHILIPS ELECTRONICS AUSTRALIA LIMITED & OTHERS N 197 of 2000 BRANSON J SYDNEY 17 JULY 2000

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 197 of 2000

BETWEEN: CLAYTON ROBERT CROKER

Applicant

AND: PHILIPS ELECTRONICS AUSTRALIA LIMITED AND ORS

Respondents

JUDGE: BRANSON J

DATE OF ORDER: 17 JULY 2000

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The statement of claim be struck out. 2. The applicant have leave to file and serve an amended application and a fresh statement of claim by no later than 4:00pm on Monday 21 August 2000. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 197 of 2000

BETWEEN: CLAYTON ROBERT CROKER

Applicant

AND: PHILIPS ELECTRONICS AUSTRALIA LIMITED AND ORS

Respondents

JUDGE: BRANSON J

DATE: 17 JULY 2000

PLACE: SYDNEY

REASONS FOR JUDGMENT

INTRODUCTION 1 The respondents have today moved on notices of motion for orders that the proceeding be stayed or dismissed, or as the alternative, that the statement of claim be struck out. I have decided that it would not be appropriate at this stage to stay or dismiss the proceeding. However, there will be an order striking out the statement of claim. The applicant will be given leave to amend the application and to file and serve a fresh statement of claim. Before giving the reasons for my decisions on the motions before me today, it is appropriate to set out a little of the history of this matter. 2 The applicant initiated this proceeding by an application, incompletely dated, which was filed on 9 March 2000. The applicant has given his occupation in certain affidavits filed by him in the proceeding as "student at law". I assume that the applicant is not well advanced in his legal studies. His application does not fully comply with the requirements of O 4 r 1(2) of the Federal Court Rules, nor does it comply fully with O 4 r 3(1)(b) of the rules. It is infected with errors of spelling and syntax and discloses a lack of understanding of the nature of interlocutory relief. The body of the application is as follows: "The Applicant seeks damages in respect to the Trade Practices Act 1974(cth) Section 82, for a breach by Philip' s Electronices Australia Limited and Dick Smith Electronices Limited in respect to trade and commerce. 1. Both Electronices Australia Limited and Dick Smith Electronices Limited have breached the Trade Practices Act 1974(Cth) Section 52(1),(2) and 53(a),(b),(c) and (ea). 2. The Applicant seeks damages in Trade Practices Act 1974(cth) Section 82, for a breach by the Philip' s Electronices Australia Limited and Dick Smith Electronices Limited respect to the claim has procrastinated in the Fair Trading Tribunal. B. Claim for interlocutory releif and the Applicant claims by way of interlocutory relief: 1. A claim for costs associated with the several appeals is requested. 2. Recession of the contract that the applicant is engaged in with Telstra which was a result of the breach of the Trade Practices Act1974(Cth) Section 52(1), (2) and 53. By Dick Smith Electronices Limited." 3 The relief claimed against Telstra by the application gives rise to the possibility that the applicant may wish to place reliance on s 87 of the Trade Practices Act 1974 (Cth) ("the TPA"). In the circumstances, at the first directions hearing I did not consider that it was appropriate to transfer the matter to a state court of inferior jurisdiction (s 86A(2) of the TPA) particularly as the Federal Magistrates Court was at that time soon to commence sitting. 4 At the time of the first directions hearing, I urged Mr Croker to give serious consideration to obtaining the advice of a qualified legal practitioner with respect to the subject matter of his application. As it was apparent from an affidavit filed by Mr Croker in support of his application that he had initiated his proceeding in this Court because of his dissatisfaction with a single mobile telephone, I also urged Mr Croker, if he was determined to proceed with his claims, to give consideration to seeking relief in a more appropriate forum. I drew his attention to the provisions of O 62 r 36A of the Federal Court Rules which provide for a reduction in the costs otherwise payable where a party is awarded judgment for less than $100,000 on a claim for damages or where the Court or a judge is of the opinion that a proceeding could more suitably have been brought in another court or in a tribunal. 5 I gained the clear impression that Mr Croker resented my attempts to counsel him concerning his proceeding in the Court. He responded by filing an affidavit by which he sought to "repeal" one paragraph of his earlier affidavit and replace it with a paragraph worded as follows: "XVIA. The applicant now seeks a claim for damages of the amount of $100,000.00 in the following domains: punitive; negligence; disappointment; equity; misrepresentation for; inconvenience for; interest; restitution; injured feelings." 6 On 10 May 2000, I ordered that the matter proceed on pleadings. I set a timetable for the completion of pleadings which included an order that the applicant file and serve a statement of claim by 24 May 2000. On 25 May 2000, the applicant filed a document which purports to be a statement of claim. It does not conform with O 11 r 2 which provides that a pleading shall contain a statement in summary form of the material facts upon which the applicant relies but not the evidence on which those facts are to be proved. The document is largely a recital of narrative facts but it includes also conclusions of law apparently based on such narrative facts. 7 By the time of the third directions hearing, the first and second respondents had filed a notice of motion seeking an order that the proceeding be stayed or dismissed generally. The third respondent had filed a notice of motion seeking an order that the application be dismissed against the third respondent or alternatively that the application as against the third respondent be struck out. 8 At the third directions hearing held on 4 July 2000, I again urged the applicant to seek legal advice. I drew his attention to his vulnerability to orders for costs made in favour of the respondents including the possibility of orders that costs be paid forthwith, notwithstanding that the proceeding is not concluded (O 62 r 3(1)). I suggested that even if he were not willing to seek legal advice that he might consider consulting a text on court pleadings from his Law School's library. As the applicant has not sought leave to amend either his application or his statement of claim, I have today heard argument on the respondents' notices of motion. 9 It is convenient to deal first with the motion of the third respondent, Telstra Corporation Limited. Neither the application nor the statement of claim contains allegations that the third respondent has engaged in or has been involved in any conduct in contravention of a provision of Part IV, Part IVA, Part IVB or Part V of the TPA. The claim in the application against the third respondent, which appears under the heading "Claims for Interlocutory Relief", is a claim for the recision of a contract between the applicant and the third respondent. 10 Both counsel for the third respondent and I had assumed that the applicant's claim against the third respondent was a claim for relief pursuant to s 87(1A) of the TPA. However, Mr Croker has today advised that it was in fact a claim under s 75A of the TPA. Section 75A provides as follows: "(1) Where: (a) a corporation supplies goods to a consumer in the course of a business; and (b) there is a breach of condition that is, by virtue of a provision of Division 2, implied in the contract for the supply of the goods; the consumer is, subject to this section, entitled to rescind the contract by: (c) causing to be served on the corporation a notice in writing signed by him or her giving particulars of the breach; or (d) causing the goods to be returned to the corporation and giving to the corporation, either orally or in writing, particulars of the breach. (2) Where a consumer purports to rescind under this section a contract for the supply of goods by a corporation, the purported rescission does not have any effect if: (a) the notice is not served or the goods are not returned within a reasonable time after the consumer has had a reasonable opportunity of inspecting the goods; (b) in the case of a rescission effected by service of a notice, after the delivery of the goods to the consumer but before the notice is served: (i) the goods were disposed of by the consumer, were lost, or were destroyed otherwise than by reason of a defect in the goods; (ii) the consumer caused the goods to become unmerchantable or failed to take reasonable steps to prevent the goods from becoming unmerchantable; or (iii) the goods were damaged by abnormal use; or (c) in the case of a rescission effected by return of the goods, while the goods were in the possession of the consumer: (i) the consumer caused the goods to become unmerchantable or failed to take reasonable steps to prevent the goods from becoming unmerchantable; or (ii) the goods were damaged by abnormal use. (3) Where a contract for the supply of goods by a corporation to a consumer has been rescinded in accordance with this section: (a) if the property in the goods had passed to the consumer before the notice of rescission was served on, or the goods were returned to, the corporation – the property in the goods re-vests in the corporation upon the service of the notice or the return of the goods; and (b) the consumer may recover from the corporation, as a debt, the amount or value of any consideration paid or provided by him or her for the goods. (4) The right of rescission conferred by this section is in addition to, and not in derogation of, any other right or remedy under this Act or any other Act, any State Act, any law of a Territory or any rule of law." 11 Mr Croker has told the Court that he relies on the supply by Telstra to him of a SIM card. No mention of any such supply is made in either the application or the statement of claim. Nor do the application or the statement of claim allege that Mr Croker has taken action to rescind any contract between him and the third respondent. In the circumstances it is appropriate to give consideration to s 87(1A) of the TPA. 12 Section 87(1A) of the TPA provides as follows: "(1A) Without limiting the generality of section 80, the Court may, on the application of a person who has suffered, or is likely to suffer, loss or damage by conduct of another person that was engaged in (whether before or after the commencement of this subsection) in contravention of a provision of Part IVA, IVB or V or on the application of the Commission in accordance with subsection (1B) on behalf of such a person or 2 or more such persons, make such order or orders as the Court thinks appropriate against the person who engaged in the conduct or a person who was involved in the contravention (including all or any of the orders mentioned in subsection (2)) if the Court considers that the order or orders concerned will compensate the person who made the application, or the person or any of the persons on whose behalf the application was made, in whole or in part for the loss or damage, or will prevent or reduce the loss or damage suffered, or likely to be suffered, by such a person." There is no allegation in either the application or the statement of claim that the third respondent engaged in any conduct in contravention of Parts IVA, IVB or V of the TPA. 13 Although I have grave misgivings about whether the applicant has a reasonable cause of action against the third respondent, I am not satisfied that it would be appropriate at this stage to stay or dismiss the proceeding against the third respondent. Having regard to the finality of an order staying or dismissing the proceeding, I consider that the applicant should be given one further opportunity to plead a case against the third respondent. He should understand, however, that this may be his last opportunity to do so. 14 I turn to consider the notice of motion of the first and second respondents which has today been amended to include a reference to O 11 r 16 of the Federal Court Rules. I am not at this stage satisfied that the proceeding should be stayed or dismissed as against the first and second respondents on the ground that the claims sought to be made against them are manifestly groundless or on the basis of an issue estoppel arising from a determination of the Fair Trading Tribunal of New South Wales. However, as I have already mentioned, the statement of claim does not comply with the requirements of the Federal Court rules for the pleading of statements of claim. It is so defective that it would be plainly embarrassing to require any respondent to answer it. As to all respondents, I am satisfied that the statement of claim in its present form has a tendency to cause prejudice, embarrassment and delay to the proceeding. It is not a document capable of being sensibly amended. The whole of the statement of claim should be struck out. 15 The order of the Court on each of the notices of motion is that the statement of claim be struck out. The applicant will have leave to amend his application and to file and serve a fresh statement of claim by 28 August 2000 but not thereafter without leave. I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Branson.