FEDERAL COURT OF AUSTRALIA Jackson v Citimark Japan Pty Ltd [2008] FCA 786 Federal Court of Australia Act 1976 (Cth) s 43 Federal Court Rules O 22 r 2(1)(b) SIMON JACKSON and KUBUSHIKI KAISHA RAD REGISTRATION NUMBER 4334-01-000342 v CITIMARK JAPAN PTY LTD (ACN 120 903 326), KUBUSHIKI KAISHA BABCOCK & BROWN REGISTRATION NUMBER 026606, BABCOCK & BROWN LIMITED (ACN 108 614 955), CITIMARK PROPERTIES PTY LTD (ACN 066 613 349), ROBERT JAMES PULLAR and ANGUS WILLIAM JOHNSON NSD 2521 of 2007 GYLES J 27 MAY 2008 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 2521 of 2007 BETWEEN: SIMON JACKSON First Applicant KUBUSHIKI KAISHA RAD REGISTRATION NUMBER 4334-01-000342 Second Applicant AND: CITIMARK JAPAN PTY LTD (ACN 120 903 326) First Respondent KUBUSHIKI KAISHA BABCOCK & BROWN REGISTRATION NUMBER 026606 Second Respondent BABCOCK & BROWN LIMITED (ACN 108 614 955) Third Respondent CITIMARK PROPERTIES PTY LTD (ACN 066 613 349) Fourth Respondent ROBERT JAMES PULLAR Fifth Respondent ANGUS WILLIAM JOHNSON Sixth Respondent JUDGE: GYLES J DATE OF ORDER: 27 MAY 2008 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1 The proceeding be dismissed. 2 The applicants pay the respondents' costs of the proceeding. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using eSearch on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 2521 of 2007 BETWEEN: SIMON JACKSON First Applicant KUBUSHIKI KAISHA RAD REGISTRATION NUMBER 4334-01-000342 Second Applicant AND: CITIMARK JAPAN PTY LTD (ACN 120 903 326) First Respondent KUBUSHIKI KAISHA BABCOCK & BROWN REGISTRATION NUMBER 026606 Second Respondent BABCOCK & BROWN LIMITED (ACN 108 614 955) Third Respondent CITIMARK PROPERTIES PTY LTD (ACN 066 613 349) Fourth Respondent ROBERT JAMES PULLAR Fifth Respondent ANGUS WILLIAM JOHNSON Sixth Respondent JUDGE: GYLES J DATE: 27 MAY 2008 PLACE: SYDNEY REASONS FOR JUDGMENT 1 In this matter, the applicants do not wish to pursue the litigation. Statements have been made from the bar table as to why that is so, which indicate a commercial, rather than a legal, basis for that decision. That, I think, is collateral to the questions which have to be answered by me here. It is submitted on behalf of the applicants that they can discontinue if they wish, pursuant to O 22 r 2(1)(b) of the Federal Court Rules. 2 The debate turns on two matters. It is accepted by the applicants that they must pay costs, but on the ordinary basis. The respondents, firstly, seek costs on an indemnity basis and, secondly, seek dismissal of the proceeding rather than discontinuance, because of the procedural history. As to the latter, counsel for the first and fourth respondents handed up a procedural chronology which I will have marked for identification number 1. That will be retained with the papers. 3 There is a real question as to whether or not the Court has power to order indemnity costs in a case where O 22 r 2(1)(b) is applicable. It is arguable that s 43 of the Federal Court of Australia Act 1976 (Cth) would be wide enough to encompass such an order. I do not need to resolve that matter as, in my opinion, there is no case made out for indemnity costs in the present circumstances. The procedural history has been unfortunate, however on two separate occasions orders were made for payment of costs to deal with the defaults. There is no sufficient basis on which I can say that the proceeding was quite misconceived, or mischievous. Certainly the pleading required attention; that was accepted by the applicants themselves, but it is a long step to say that it was so without merit as to amount to vexation and thus warrant an order for indemnity costs. 4 The next question is whether or not the proceeding should be dismissed. There has been no notice of discontinuance filed and it seems to me that the best solution is to dismiss the case. The effect of filing a notice of discontinuance is not entirely clear because whether this is a matter continuing on the pleadings in the strict sense within the meaning of O 22 r 2(1)(b) may be open to some doubt. It seems to me that the effect of a dismissal otherwise than on the merits is, so far as future estoppel is concerned, indistinguishable from the effect of a notice of discontinuance under the Federal Court Rules. The failure of the applicants to comply with the directions of the Court provides a proper basis for dismissal, and in any event it is clear that they do not wish to proceed with the matter. 5 The order of the Court is that the proceeding is dismissed. The applicants are to pay the respondents' costs. It is noted that the existing costs orders remain. I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles. Associate: Dated: 28 May 2008 Counsel for the Applicants: Mr H Altan Solicitor for the Applicants: Berrigan Doube Lawyers Counsel for the First and Fourth Respondents: Mr I Jackman SC Solicitor for the First and Fourth Respondents: Mallesons Stephen Jaques Solicitor for the Second and Third Respondents: Mr C Hanson of Freehills Date of Hearing: 27 May 2008 Date of Judgment: 27 May 2008