Wu v Avin Operations Pty Ltd [2007] FCA 882

FEDERAL COURT OF AUSTRALIA

WU V AVIN OPERATIONS PTY LTD [2007] FCA 882

JUN XUE WU V AVIN OPERATIONS PTY LTD &ORS VID 187 OF 2006

RYAN J

14 JUNE 2007

MELBOURNE IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY VID187 OF 2006

BETWEEN: JUN XUE WU

Applicant

AND: AVIN OPERATIONS PTY LTD (ACN 076 956 913)

BARRIE ARMITAGE

CHRISTOPHER JAMES ARMITAGE

JOAN DOROTHY ARMITAGE

ASIA PACIFIC COATING PTY LTD (ACN 089 840 728)

Respondents

JUDGE: RYAN J DATE OF ORDER: 14 JUNE 2007

WHERE MADE: MELBOURNE

THE COURT ORDERS THAT:

1. Unless the costs of the applicant, Jun Xue Wu, of and incidental to the hearing of 18 May 2006, have been comprehended by the consent order made on 26 February 2007 in proceedings numbered (P) VID 372 of 2003, the said costs, in default of agreement be taxed before the conclusion of the principal proceeding and paid by the second respondent, Barrie Murdoch Armitage, forthwith upon taxation or agreement. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY VID187 OF 2006

BETWEEN: jun xue wu

Applicant AND: AVIN OPERATIONS PTY LTD (ACN 076 956 913)

BARRIE ARMITAGE

CHRISTOPHER JAMES ARMITAGE

JOAN DOROTHY ARMITAGE

ASIA PACIFIC COATING PTY LTD (ACN 089 840 728)

Respondents

JUDGE: RYAN J

DATE: 14 JUNE 20077

PLACE: MELBOURNE

REASONS FOR JUDGMENT ON COSTS 1 There was before the Court an application for an extension of time in which to seek to appeal from certain orders made by Kenny J on 3 February 2006, in proceeding numbered VID 327 of 2003 involving the same parties before this Court. Her Honour's orders were in these terms: "1. The applicant prepare a bill of costs in respect of the motion, notice of which was filed on 4 August 2004, and such bill of costs be taxed by Registrar Bardsley at 10.15am on 13 February 2006. 2. The first and second respondents pay forthwith the applicant's costs of and incidental to the motion, notice of which was filed on 4 August 2004, on an indemnity basis, to be taxed pursuant to paragraph 1 hereof. 3. If the first and second respondents do not pay the applicant's taxed costs within 14 days from the date of service upon them of a certificate of taxation, then the applicant have leave to enter judgment against the first and second respondents for $334,000 and interest thereon. 4. The motion, notice of which was filed on 4 August 2004, be otherwise dismissed." 2 The motion on notice dated 4 August 2004 referred to in paras 1 and 2 of those orders was by the present respondent, Ms Wu, the applicant in the substantive proceedings for leave to enter judgment against the first respondent Avin Operations Pty Ltd ("Avin") and the second respondent, Barrie Armitage, who brought the application for an extension of time within which to seek leave to appeal. 3 It is accepted by Mr Armitage that the orders of Kenny J were interlocutory and that pursuant to s 24 of the Federal Court of Australia Act 1976 ("the Act") he requires leave to appeal from those orders. It is also accepted that his application for leave to appeal has been filed outside the seven day time limit imposed by O 52 r 10(1)(b) of the Rules of this Court, and on 27 March 2006 he filed an application for extension of time to apply for leave to appeal, together with a supporting affidavit sworn 27 March 2006. The power to grant such an extension under O 52 r 10(2A) is discretionary. As with other discretions of a similar kind a powerful factor to be taken into account is the applicant's prospects of success if the extension of time were granted; see Pitmann v AAT [2005] FCA 1540. 4 In the present case the orders in respect of which leave to appeal was sought were themselves made in the exercise of a wide general discretion. Accordingly, they would only be set aside on appeal if the primary judge's discretion is shown to have miscarried in accordance with the oft cited principles enunciated by the High Court in House v R (1976) 55 CLR 499 at 504. 5 Counsel for Ms Wu submitted that Mr Armitage had not pointed to any wrong principle applied by her Honour in making the orders of 3 February 2006. Nor could it be suggested that her Honour failed to take into account some material consideration or that she had been influenced by some extraneous or irrelevant matter. It must be borne steadily in mind that, if one puts to one side the self-executing mechanism in para 3 of her Honour's order, all that she did, in effect, was require the first and second respondents to pay forthwith Ms Wu's costs of her motion on notice dated 4 August 2004. Her Honour clearly took the view that the institution or prosecution of that motion was necessary to obtain the limited interlocutory progress of the matter which was subsequently achieved. 6 In these circumstances, I considered that Mr Armitage would, if granted leave, be unable to satisfy the requirements identified by a Full Court of this Court in Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397. In that case the Full Court, at 398 adopted the two limbs of the test enunciated by a Full Court of the Supreme Court of Victoria in Niemann v Electronic Industries Ltd [1978] VR 431: "[t]he first test, which relates to the prospects of the proposed appeal, is 'whether, in all the circumstances, the decision is attended with sufficient doubt to warrant its being reconsidered by the Full Court.' The second 'is whether substantial injustice would result if leave were refused, supposing the decision to be wrong.'" However, it appeared that a more appropriate option for Mr Armitage to follow was to apply in the substantive proceeding before Kenny J, pursuant to O 35 r 7 of the Rules of this Court for an order setting aside or varying her Honour's order of 3 February 2006. I therefore indicated this to Mr Armitage at a directions hearing on 22 March 2006, and subsequently adjourned his application for an extension of time in which to seek leave to appeal. On 12 April 2006 I made the following orders: '1. The application for extension of time for leave to appeal filed 27 March 2006 be adjourned to 18 May 2006. 2. The costs of the respondent, Ms Wu, of this day be reserved. 3. Liberty be reserved to either party to apply on not less than 48 hours notice in writing to the other party.' 7 On 26 April 2006 the parties appeared at a callover before Black CJ, where it was noted that the matter could not proceed until the respondent's application to extend time had been resolved, and an order was made that costs be reserved. 8 On 16 May 2006, Mr Armitage issued a notice of motion, returnable on 15 June 2006, in the substantive proceeding before Kenny J, seeking to have the orders of her Honour of 3 February 2006 set aside. On 18 May 2006, at the hearing of the application for an extension of time to seek leave to appeal in the present proceeding, I made the following orders: '1. The application for an extension of time for leave to appeal be adjourned to a date to be fixed, before 28 July 2006. 2. Costs be reserved.' 9 After the return of the notice of motion before Kenny J on 15 June 2006, her Honour made orders on 27 June 2006, amongst others, that orders 2 and 3 of the orders of 3 February 2006 be set aside, and substituted new orders, affirming the costs order against the first and second respondents, but not requiring payment until a date to be fixed after judgment in the substantive proceeding. 10 In the light of the orders made by Kenny J on 27 June 2006 in the substantive proceeding, the Court wrote on 3 July 2006 to the parties, requesting written submissions in relation to proposed orders dismissing the application for an extension of time within which to seek leave to appeal and dealing with costs of the hearing on 18 May 2006. The parties informed the Court that they agreed to the dismissal of the application for an extension of time and, on 17 July 2006, I ordered that the respondent's application for leave to appeal purportedly made by notice of appeal filed on 24 February 2006 be dismissed.