Richards v Macquarie Bank Limited [2011] FCA 1085

FEDERAL COURT OF AUSTRALIA

Richards v Macquarie Bank Limited [2011] FCA 1085 Citation: Richards v Macquarie Bank Limited [2011] FCA 1085

Parties: TRACEY RICHARDS v MACQUARIE BANK LIMITED ABN 46 008 583 542

File number: QUD 590 of 2010

Judge: REEVES J

Date of judgment: 2 August 2011

Date of hearing: 1 August 2011

Place: Brisbane

Division: GENERAL DIVISION

Category: No Catchwords

Number of paragraphs: 12

Counsel for the Applicant: Mr J Lee with Mr G Donnellan

Counsel for the Respondent: Mr D Kelly

Solicitor for the Respondent: Allens Arthur Robinson

IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY GENERAL DIVISION QUD 590 of 2010

BETWEEN: TRACEY RICHARDS

Applicant

AND: MACQUARIE BANK LIMITED ABN 46 008 583 542

Respondent

JUDGE: REEVES J DATE OF ORDER: 2 AUGUST 2011 WHERE MADE: BRISBANE

THE COURT ORDERS THAT:

1. The respondent pay the applicant's costs of and incidental to the notice of motion dated 22 July 2011. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011

IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY GENERAL DIVISION QUD 590 of 2010

BETWEEN: TRACEY RICHARDS

Applicant

AND: MACQUARIE BANK LIMITED ABN 46 008 583 542

Respondent

JUDGE: REEVES J DATE: 2 AUGUST 2011 PLACE: BRISBANE

REASONS FOR JUDGMENT 1 As I indicated yesterday, because this application involves a matter of practice and procedure and a discretionary decision as well, from which there is no right of appeal, I propose to say what my decision is and to state, in brief summary form, why it is I have reached that decision. As I also indicated yesterday, if either of you wants me to provide detailed reasons, you can indicate that after I deliver my decision and I will decide whether or not I accede to that request. 2 My decision is that the applicant should be given leave to amend the originating application and the statement of claim, essentially in the form appearing as annexure A to the affidavit of Mr Imlay filed 22 July 2011 upon these conditions. 3 In relation to any allegation of constructive knowledge by Macquarie Bank Limited, the applicant is to incorporate in the final version of the statement of claim particulars of the facts and circumstances from which she says Macquarie Bank ought to have acquired its knowledge about those things in compliance with Rule 16.43(2). It is obviously a matter for counsel to assess what aspects of constructive knowledge are involved, but I think they particularly include those contained in paras 46 and 50. 4 The second condition is that any item of particulars that constitutes a material fact is to be pleaded by the applicant as such in the statement of claim. Again, it is a matter for counsel to assess – and I acknowledge that this sometimes involves a fine line – but it appears to me that examples include those particulars contained in paras 46(d), (e) and (g), or at least some of them. For example, the statement that the stock market performed in a certain way, it seems to me, is a material fact. But, again, that is a matter for counsel to assess. I will review these matters at future directions hearings. Since the applicant's counsel has indicated that there may be some other corrections that need to be made in the final form of a statement of claim, I will hear counsel as to the final forms of the orders that I make. 5 My reasons for this decision, in brief summary form, are as follows. Dealing with the three issues raised in the submissions, first, on the individual claims issued, I consider the applicant is entitled to add what Mr Kelly refers to as "a collection of idiosyncratic individual claims" to these proceedings. There is nothing in Pt IVA of the Federal Court of Australia Act 1976 (Cth) ("the Act") that prevents a representative applicant pursuing personal claims in representative proceedings. 6 To the contrary, I consider the text of the relevant provisions, and the context of other provisions in that part, indicate to the contrary. In particular, I refer to s 33C(2)(b), which refers to separate contracts, transactions, acts or omissions involving individual group members; s 33Q, which refers to subgroup claims; and s 33R, which refers to claims by an individual group member. All of these references suggest to me that individual or personal claims can be pursued in representative proceedings under Pt IVA of that Act. 7 As to the criteria set out in ss 33C(1)(b) and 1(c), I do not consider those sections require that all the claims of all the persons in the class have to meet the criteria set out therein, only that the claims of all the persons in the class meet those criteria. I consider this is an important distinction. Mr Kelly submitted for the former, and I consider that is an incorrect construction of those provisions. As to the particular claims the applicant wishes to add, they involve traditional causes of action: damages for breach of contract and unconscionable conduct. 8 It follows that the amendments to add those claims cannot be successfully opposed on futility grounds, that is, that the claims, per se, are not maintainable. If, as Mr Kelly submits, these amendments result in the proceedings being transformed from genuine representative proceedings under Pt IVA of the Act, that, I consider, does not provide a ground to successfully oppose the amendments. Rather, the respondent's remedy lies in an application under s 33N of the Act for the proceedings not to continue as representative proceedings. 9 As to the submissions Mr Kelly made that I should act on my own motion under s 33N, in the circumstances where both parties are represented by experienced counsel, I do not consider there is any justification for that course. Moreover, there is nothing before me that could allow me to be satisfied about the matters set out in s 33N(1)(a) to (1)(d) such that I could take that course, even if I were minded to, which I am not. On the particulars issue, I have already dealt with the particulars of constructive knowledge and the particulars that appear to plead material facts, otherwise I consider the applicant has properly pleaded and particularise the respondent's actual knowledge in accordance with Rule 16.43. 10 Even if Macquarie Bank considered that the applicant had not done that and it still seeks particulars, the actual knowledge, or other aspects of the pleading, it is well-established that that, in itself, provides no justification for refusing leave to amend or, for that matter, delaying the delivery of a defence. Moreover, if Macquarie Bank makes an application for particulars, it will have to contend with the provisions of the new Rules, specifically Rule 16.45, which makes it clear particulars are now only ordered in limited circumstances, as stated in Rule 16.45(2). 11 Finally, as to para 62, Macquarie Bank criticises that paragraph because it does not involve any allegation of material fact but rather is a statement of intention, on the applicant's behalf. I was told that para 62 represents an attempt by the applicant to satisfy s 33H(1)(b) of the Act to "the degree possible at this early stage of the proceedings". Section 33H(1)(b) requires, among other things, that an applicant must specify the nature of the claims being made on behalf of the group members, and the relief claimed. While it may be quite general in its terms, I consider para 62 does meet those requirements, particularly when it is read with para 4 of the proposed amended originating application. 12 I order that the respondent pay the applicant's costs of and incidental to that notice of motion. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Reeves.