FEDERAL COURT OF AUSTRALIA Maxims Entertainment Pty Ltd v Chinatown Enterprises Pty Ltd [2000] FCA 1485 PRACTICE & PROCEDURE – application for extension of time to file and serve notice of appeal – whether "special reasons" to extend time. EVIDENCE – dispensing with rules of – whether matters "not bona fide in dispute" at ex parte hearing of which party had notice – whether matters are only "not bona fide in dispute" if admitted. Federal Court Rules, O 33 r 3, O 35 r 7(2)(a), O 52 r 10(2)(b), O 52 r 15(2), O 52 r 15(6), O 62 r 11 Deighton v Telstra Corporation Limited (FCA: Lee, Heerey and RD Nicholson JJ, 17 October 1997, unreported) referred to Maxims Entertainment Pty LTd v Chinatown Enterprises Pty LTd NG 918 of 1995 KATZ J 23 OCTOBER 2000 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NG 918 of 1995 BETWEEN: MAXIMS ENTERTAINMENT PTY LTD First Applicant LONG SHONG PICTURES (HK) LTD Second Applicant PRO-VISION ENTERTAINMENT LTD Third Applicant POWER WORLD PRODUCTION LTD Fourth Applicant RISING SUN PICTURES LIMITED Fifth Applicant AND: CHINATOWN ENTERPRISES PTY LTD First Respondent MANDARIN FILMS (AUSTRALIA) PTY LTD Second Respondent WING CHEUNG Third Respondent THO VINH HUYNH Fourth Respondent JUDGE: KATZ J DATE OF ORDER: 23 OCTOBER 2000 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The third respondent's application be dismissed. 2. The third respondent pay the applicants' costs of the application. 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 NG 918 of 1995 BETWEEN: MAXIMS ENTERTAINMENT PTY LTD First Applicant LONG SHONG PICTURES (HK) LTD Second Applicant PRO-VISION ENTERTAINMENT LTD Third Applicant POWER WORLD PRODUCTION LTD Fourth Applicant RISING SUN PICTURES LIMITED Fifth Applicant AND: CHINATOWN ENTERPRISES PTY LTD First Respondent MANDARIN FILMS (AUSTRALIA) PTY LTD Second Respondent WING CHEUNG Third Respondent THO VINH HUYNH Fourth Respondent JUDGE: KATZ J DATE: 23 OCTOBER 2000 PLACE: SYDNEY REASONS FOR JUDGMENT 1 There is before the Court an application under O 52, subr 15(2) of the Federal Court Rules ("the FCRs") for an extension of time within which to file and serve a notice of appeal. The application was filed on 29 June 2000 by Mr Wing Cheung and sought an extension of time in respect of three separate judgments of Burchett J. Those judgments had been given on 16 December 1998, 9 September 1999 and 9 May 2000 respectively. 2 In an earlier set of reasons in this matter (Maxims Entertainment Pty Ltd v Chinatown Enterprises Pty Ltd [2000] FCA 1260 (5 September 2000, unreported)), I referred to the nature of each of the three judgments the subject of the present application. For present purposes, I repeat the following matters. 3 The first judgment was in favour of the respondents to the present application (who I will refer to in these reasons simply as "Maxims") and (relevantly) against Mr Cheung. The judgment determined a claim for copyright infringement and awarded Maxims $15,680 in damages, together with seven-eighths of its costs of the proceeding. It appears from Burchett J's reasons for judgment that, although Mr Cheung had been aware of the scheduled hearing before Burchett J of Maxims' claim, Mr Cheung had not appeared at that hearing. 4 The second judgment dismissed an application which had been made by Mr Cheung under O 35, par 7(2)(a) of the FCRs that Burchett J set aside his earlier judgment. 5 The third judgment dismissed an application which had been made by Mr Cheung, apparently under O 62, r 11 of the FCRs, to review the taxation of seven-eighths of the costs of the first proceeding, those costs having been taxed at $79,252.25. 6 Order 52, r 15(2) of the FCRs requires an applicant for leave to appeal out of time to show "special reasons" why such leave should be given and O 52, r 15(6) of the FCRs requires the applicant for leave to accompany the application for leave with an affidavit showing, among other things, "the reason why leave should be given" (par (c)). 7 Mr Cheung's application for leave was accompanied by an affidavit in which his solicitor deposed to reasons why Mr Cheung should be given leave to appeal out of time. Those reasons were: "(a) [Mr Cheung] is liable to pay a substantial sum of money pursuant to the orders made. (b) [Mr Cheung] was not heard on his notice [of] objection [to the bill of costs in the first proceeding]. (c) Questions of public importance arise where a party has been refused the opportunity to be heard. (d) Questions of law arise for determination in this case." 8 In so far as the reasons to which I have just referred were being proffered as special reasons why Mr Cheung should be granted leave to appeal out of time, it is manifest that they failed so to qualify. 9 As to the first and fourth of the reasons, it is a commonplace that judgments sought to be appealed from are for the payment of substantial sums of money and almost universal that judgments sought to be appealed from are said to have been attended by errors of law. 10 As to the second and third of the reasons given, they obviously relate only to the third of the three judgments sought to be appealed from and amount to saying that whenever one seeks to appeal on the ground of a denial of natural justice, the case is a special one for the purpose of an application for an extension of time within which to appeal. Not only is that not so, but the reasons given misstate what would be the relevant issue on any appeal from Burchett J's third judgment. Burchett J found that Mr Cheung had not filed in accordance with the FCRs a requisite notice of objection to the bill of costs served by Maxims in respect of the first proceeding (a finding accepted by Mr Cheung as correct at the hearing before me) and declined, on discretionary grounds, to permit Mr Cheung to reopen the matter, so that a full taxation could then take place. Any appeal from Burchett J's judgment would need to establish some error in the exercise of his discretion by Burchett J. 11 As well as the matters to which I have referred above about what was actually set out in the affidavit accompanying the application for an extension of time within which to appeal, I note the absence from that affidavit of any evidence as to a significant matter, namely, an explanation both of the failure to appeal within time and of the delay in seeking an extension of time within which to appeal. 12 It will be apparent from what I have already said that I am not persuaded by the material in the supporting affidavit that there exist special reasons for granting the leave which Mr Cheung seeks. 13 Nor was Mr Cheung's position so far as the need to establish special reasons is concerned improved by the oral submissions made on his behalf at the hearing before me, since the meaning and the application in the present circumstances of the notion of "special reasons" was not mentioned at all in those submissions. 14 The matter of delay was, on the other hand, mentioned in those submissions, but only in a somewhat peculiar way. It was submitted in effect that the delay associated with seeking an extension of time in respect of the third judgment was minor, compared to the delay associated with seeking an extension of time in respect of the first and second judgments. So it was, but I am unable to see how that assists Mr Cheung so far as seeking to appeal from the third judgment is concerned, especially when there was, as I have already said, no evidence of the reasons for delay in connection with the third judgment. 15 In addition to the problems with Mr Cheung's application to which I have already referred, there are a number of other problems with his application which I should mention as well. 16 First, all other things apart, I would not have been prepared to grant Mr Cheung leave to appeal out of time against Burchett J's first judgment, when Mr Cheung elected in the first instance to apply to Burchett J to have it set aside and then had that application determined. 17 Secondly, Mr Cheung's application proceeded on the basis that all three judgments of Burchett J were final. It is by no means apparent to me that that was so, particularly in respect of the second and third of those judgments. To the extent to which the judgments were interlocutory, rather than final, Mr Cheung's application was misconceived and would fail for that reason alone. (Of course, if Mr Cheung had instead made application under O 52, par 10(2)(b) of the FCRs for an extension of time in which to seek leave to appeal from one or more interlocutory judgments, his position would not have been improved: see Deighton v Telstra Corporation Limited (FCA: Lee, Heerey and RD Nicholson JJ, 17 October 1997, unreported) at 4.) 18 Finally and all other things apart, I have not been persuaded by Mr Cheung that there exist any real prospects for success of an appeal against any of Burchett J's three judgments. 19 On the question of the prospects for success of an appeal against Burchett J's first judgment, the sole error alleged by Mr Cheung in oral submissions before me to have been made by Burchett J in that judgment was his Honour's dispensing with the rules of evidence under O 33, r 3 of the FCRs. That rule provides: "The Court may at any stage of the proceedings: (a) dispense with compliance with the rules of evidence for proving any matter which is not bona fide in dispute; or (b) dispense with compliance with the rules of evidence where such compliance might occasion or involve unnecessary or unreasonable expense or delay, including, but without limiting the generality of this power, compliance with the rules relating to proof of handwriting or of documents and the proof of the identity of parties or of authority." 20 Burchett J relied on both paragraphs of O 33, r 3 of the FCRs in dispensing with the rules of evidence in the proceeding which led to his first judgment. As to the first of those paragraphs, Burchett J took the approach that the facts which the applicants were required to prove before him in order to succeed were "not bona fide in dispute" within the meaning of that paragraph in circumstances in which Mr Cheung, with notice of the hearing, had not attended it. Although Mr Cheung conceded before me that he had no authority to suggest that Burchett J's approach in that respect had been wrong, he nevertheless submitted that a matter could not be said to be "not bona fide in dispute" within the meaning of O 33, par 3(a) of the FCRs unless it had been admitted by the party against which it was sought to be proved. Of course, if it had been admitted in that way, then there would be no need to use the provision at all; instead, the admission could be relied on. That shows that Mr Cheung's allegation of error by Burchett J regarding the latter's use of O 33, par 3(a) of the FCRs was itself erroneous. Further, since O 33, pars 3(a) and (b) of the FCRs are disjunctive, Burchett J relied on both of them and no error is disclosed in his reliance on the first of them, it is unnecessary to trouble oneself about Burchett J's reliance on the second of them. 21 Turning now to the second of Burchett J's three judgments, the sole error alleged by Mr Cheung in oral submissions before me to have been made by Burchett J in that judgment was his Honour's failure to give adequate reasons for concluding that Mr Cheung had not made out any bona fide defence which he ought to be permitted to litigate. However, even assuming for present purposes that that criticism is correct, it ignores the fact that Burchett J expressly founded his decision on, not one, but two grounds. His Honour said, "Both because it does not appear to me that there is any explanation which I should accept as a reasonable justification in the circumstances [for the delay in bringing the application to set aside the first judgment], and because I am not satisfied that any bona fide defence has been made out which [Mr Cheung] ought to be permitted, even in the present circumstances, to litigate, I dismiss the motion with costs." No submission was made before me that Burchett J had erred in any respect in relying on the first of the two grounds which he put forward. In those circumstances, any error by him so far as the second of the two grounds is concerned would be immaterial and the prospects of its being established therefore need not be considered for present purposes. 22 Turning now to the third of Burchett J's three judgments, the sole error alleged by Mr Cheung in oral submissions before me to have been made by Burchett J in that judgment was his Honour's reliance, in exercising his discretion against permitting the reopening of the costs matter, on the fact that Mr Cheung had made no payment either of the sum owing under Burchett J's first judgment or of any of Maxims' costs of the first proceeding. I must confess that I did not quite follow how it was said that that was an error by Burchett J, but it was plain to me in any event that the submission was based on a misconception. On 9 May 2000, when Burchett J gave his third judgment, his first judgment remained effective, having been given on 16 December 1998 and having not been set aside on 9 September 1999. There was no proceeding then on foot challenging that decision and Burchett J was fully entitled to proceed on the basis that Mr Cheung then accepted that he owed Maxims $15,680 in damages. Further, Burchett J was told during the third proceeding that, if Mr Cheung were permitted to reopen the costs matter, he would succeed in reducing seven-eighths of the taxed costs of the first proceeding from $79,252.25 to $26,480. Burchett J was therefore fully entitled to proceed on the basis that Mr Cheung then accepted that he owed Maxims $26,480 in costs for the first proceeding. It was those two sums of $15,680 and $26,480, totalling together about $42,000, that Burchett J had in mind when exercising his discretion against Mr Cheung in his third judgment and, at the time at which he took them into account, he had every right to do so. 23 In all the circumstances, Mr Cheung's application is dismissed with costs. I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Katz. Associate: Dated: 23 October 2000 Counsel for the Applicants: Ms J Pentelow Counsel for the Third Respondent: Ms R Winfield Solicitor for the Third Respondent: William Chan & Co Solicitors Date of Hearing: 20 October 2000 Date of Judgment: 23 October 2000