FEDERAL COURT OF AUSTRALIA Walker v Telstra Corporation Limited (No 2) [2007] FCA 1112 KELL WALKER v TELSTRA CORPORATION LIMITED NSD 153 OF 2007 ALLSOP J 24 JULY 2007 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 153 OF 2007 BETWEEN: KELL WALKER Applicant AND: TELSTRA CORPORATION LIMITED Respondent JUDGE: ALLSOP J DATE OF ORDER: 24 JULY 2007 WHERE MADE: SYDNEY THE COURT ORDERS THAT: (1) The application, filed on 2 February 2007, be stayed. (2) The applicant pay the costs of the notice of motion and of the proceedings on an indemnity basis. (3) The respondent provide a copy of these reasons and orders to Ms Sue Owens as reasonably soon after they become available in final form as is possible. (4) The notice of motion insofar as it seeks orders in paragraph 4 against Ms Owens be stood over to a date to be fixed for hearing. (5) The respondent have leave to tax the orders forthwith. (6) Leave be granted to Telstra to communicate with my chambers once they have served Ms Owens, informing me of that fact and accompanying that letter with an affidavit of service, my chambers will then fix a day for hearing, sufficiently past that date, to ensure that both parties have an opportunity to prepare for the argument. (7) The motion to the extent necessary is adjourned to a date to be fixed. 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 NSD 153 OF 2007 BETWEEN: KELL WALKER Applicant AND: TELSTRA CORPORATION LIMITED Respondent JUDGE: ALLSOP J DATE: 24 JULY 2007 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This matter was commenced by application on 2 February 2007. From the commencement, Telstra has indicated openly to the applicant through the person appearing for him, a Ms Sue Owens, that the case was an abuse in that it was substantially similar to a case that had been dealt with by this Court in the Queensland District Registry and by the Victorian Supreme Court in Victoria. 2 I do not propose to go through the matter in detail. What has been brought on today is a motion that was filed originally on 28 February 2007. Relevantly what is sought is, amongst other things but presently for today's purpose, that an order dismissing or permanently staying the proceedings be granted and that the applicant and his solicitor pay Telstra's costs of and incidental to the notice of motion. 3 Since early 2007 when the matter first came before the Court, I have been plied with a number of requests for an adjournment by Ms Owens who says she appears for Mr Walker. She has indicated her instructions on a number of occasions. Mr Walker presently languishes in a gaol in Vanuatu on serious charges. I indicated on earlier occasions that I would be prepared to adjourn the motion for a reasonable length of time to enable Mr Walker's present predicament to be resolved one way or the other. Ms Owens appeared on a number of occasions and told me various things about the state of that litigation. Eventually I set the motion down for hearing on 20 July 2007; that is, last Friday. 4 For reasons connected with the running of another case it was apparent in the middle of last week that I would not be able to have the time on Friday to hear this matter. I therefore adjourned it until this afternoon. Earlier in July Ms Owens had sent a letter to my chambers indicating that she did not propose to appear on the 20th, that is, last Friday, being the time at which the matter had been set down for hearing. 5 Last week solicitors for Telstra informed or reminded Ms Owens that one of the orders sought in the notice of motion was a personal order for costs against her for the costs of the notice of motion. Ms Owens reacted in writing in a somewhat hostile style to this, indicating that Telstra was bullying her. On Monday, that is, yesterday, 23 July 2007, Ms Owens was told that the matter had been adjourned until today. I am not satisfied that Ms Owens has had sufficient practical notice of the risk and danger of a costs order being made against her and for those reasons I propose to make an order which simply puts her on notice that she will need to show cause why she herself should not pay the costs of the notice of motion. 6 Turning to the notice of motion, the evidence before me, in particular the careful and helpful affidavits of Zaven Mardirosssian, a partner of Arnold Bloch Leibler, sworn 21 February 2007 and 23 July 2007, together with the exhibits to his affidavits, make it tolerably plain that what is being litigated in this Court is substantially similar, if not identical, to earlier proceedings. Not only were similar proceedings commenced in Queensland and dealt with by Kiefel J, but they were commenced in Victoria and have suffered the fate of repeated orders for strike-out by the Master of the Victorian Supreme Court with consequential orders for costs that have not been paid. 7 A purported discontinuance in apparent nonconformity with the rules of the Victorian Supreme Court has been filed and much of the same proceeding has been sought to be brought here, it goes without saying, without the payment of any of the costs in either the Queensland or Victorian proceedings. Prima facie from the nature of the matters pleaded and the circumstances I have related, I would characterise these proceedings as an abuse and as such should be stayed. There was no appearance either in Melbourne or Sydney today, this matter being heard by videolink. 8 Order 35 rule 7(2) paragraph (a) would entitle a person against whom an order has been made in their absence to approach the Court to seek to have the order set aside. This is so (in the original jurisdiction of the Court) even if the order has been entered. 9 Telstra brought this motion on promptly. It was my reluctance to see the position of Mr Walker prejudiced without argument that has led to the delay. Mr Walker still appears to languish in a Vanuatu gaol. I can do nothing about that, but I do not see why a plainly reasonably founded motion should perpetually await his release from gaol after either an acquittal or the serving of a sentence. In those circumstances, I took the view that it was appropriate that the notice of motion be dealt with. As I said, if good cause is shown by Mr Walker on a later occasion, the rules provide for the setting aside of these orders on appropriate terms. 10 As to Ms Owens, the background material which I have identified throws up a sufficiently strong case, unless answered, for a legal practitioner who was involved in the propounding of this case to be at risk as to costs personally. I do not propose to make an order against Ms Owens without giving her the opportunity to put forward to the Court evidence and any submissions as to why she says these orders of the kind I have identified should not be made against her. 11 She has said from the bar table on a number of occasions that an identified senior counsel in Sydney drafted the pleadings and gave advice to bring the proceeding in this Court inferentially, if not expressly said, in the fullest of knowledge of what had gone on previously in Queensland and Victoria. If that is the case, Ms Owens will need to not merely state this from the bar table but put on evidence as to any relevant matter and be subject to cross-examination. 12 This raises the question that is always difficult in these kinds of application for personal costs against the lawyer; that is, the client's legal professional privilege intrudes. It is not Ms Owens' to abandon or waive. I will leave that problem for another day. It may be that the question can be answered by recognising that even if senior counsel took the view that this was an appropriate course, that may not protect the solicitor from having undertaken a course which is clearly inappropriate. It may simply identify another person who is personally liable. 13 Now, those last comments are said without any reflection on Ms Owens or the senior counsel in question but I will need to be persuaded why a solicitor, appearing for Mr Walker, thought it appropriate to commence these proceedings in the circumstances that have occurred. I do not, for the moment, place any great weight on the fact that Ms Owens may not have had a practising certificate. That may, of itself, be a serious matter, but the matter to which I'm directing my attention at the moment is whether or not she should pay what will be the known considerable costs of this notice of motion. Therefore, the orders I will make are: (1) The application, filed on 2 February 2007, be stayed. (2) The applicant pay the costs of the respondent of the notice of motion and of the proceeding. (3) The respondent provide a copy of these reasons and orders to Ms Sue Owens as reasonably soon after they become available in final form as is possible. (4) The notice of motion insofar as it seeks orders in paragraph 4 against Ms Owens be stood over to a date to be fixed for hearing. 14 Application is made for the costs of the motion and the proceeding to be on an indemnity basis. A reasonable offer was made prior to anything really being done in the proceedings by Telstra indicating that it would walk away from the proceeding if it was discontinued promptly. Due warning was given for the use of that letter. 15 The respondent also points to the nature of the proceedings as being one which should, on the usual principles, attract an order for indemnity costs. That usual principle is that the applicant properly advised, or the party properly advised, could not possibly thwart the proceeding. In my view on the material before me at the moment, the combination of the reasonable offer to withdraw from the matter and the apparent abusive nature of the proceedings inherently, is such that an award of indemnity costs appears to be manifestly reasonable and I amend order 2 that I have made, such that the costs of the notice of motion and of the proceedings generally, be paid by the applicant on an indemnity basis. To the extent necessary, that it might be said that the orders are proposed, they are not final, it is appropriate that the respondent have leave to tax the orders forthwith and I make that order. 16 I grant leave to Telstra to communicate with my chambers once they have served Ms Owens, informing me of that fact and accompanying that letter with an affidavit of service, my chambers will then fix a day for hearing, sufficiently past that date, to ensure that both parties have an opportunity to prepare for the argument. 17 The motion to the extent necessary is adjourned to a date to be fixed. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate: Dated: 10 August 2007 Counsel for the Applicant: Mr R Peters Solicitor for the Applicant: Arnold Bloch Leibler Date of Hearing: 24 July 2007 Date of Judgment: 24 July 2007