New South Wales Supreme Court CITATION : Paul's Retail Pty Ltd v Morgan [2009] NSWSC 1343 HEARING DATE(S) : 02/12/09 JUDGMENT DATE : 2 December 2009 JURISDICTION : Equity Division Corporations List JUDGMENT OF : Barrett J EX TEMPORE JUDGMENT DATE : 2 December 2009 DECISION : Application to re-open refused. CATCHWORDS : PROCEDURE - application to re-open after judgment - whether obvious error that should be remedied by trial judge LEGISLATION CITED : Corporations Act 2001 (Cth), s 449E Uniform Civil Procedure Rules 2005, rule 36.16(3A) CATEGORY : Principal judgment Autodesk Inc v Dyason (No 2) [1993] HCA 6; (1993) 176 CLR 300 Oshlack v Richmond River Council [1993] HCA 11; (1993) 193 CLR 72 CASES CITED : Paul's Retail Pty Ltd v Morgan [2009] NSWSC 1222 Twenty-First Australia Inc v Shade (unreported, 31 July 1998, Young J) Wentworth v Rogers [2002] NSWSC 921 Paul's Retail Pty Ltd - First Plaintiff PARTIES : Paul Andrew Dwyer - Second Plaintiff John Maxwell Morgan - Defendant FILE NUMBER(S) : SC 6211/08 COUNSEL : Mr M A Ashhurst SC - Plaintiffs Mr S M Golledge - Defendant SOLICITORS : W Lawyers - Plaintiffs Blake Dawson - Defendant IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST BARRETT J WEDNESDAY 2 DECEMBER 2009 6211/08 PAUL ANDREW DWYER & ANOR v JOHN MAXWELL MORGAN JUDGMENT 1 The plaintiffs, who were largely unsuccessful in the proceedings, apply under rule 36.16 (3A) of the Uniform Civil Procedure Rules 2005 for an order recalling the judgment delivered by me on 13 November 2009: Paul's Retail Pty Ltd v Morgan [2009] NSWSC 1222. They do so on the basis that I "may not have adequately dealt with the plaintiffs' argument that even if the defendant was not precluded by contract or estoppel from seeking a review of his capped fees, the court should not exercise its discretion in favour of a review because the defendant has not adduced any evidence that he had incurred costs of the type that could not have been anticipated when he agreed to having his fees capped on 1 April 2008". 2 The plaintiffs further say that the court did not make clear that a "review" of capped fees pursuant to s 449E of the Corporations Act 2001 (Cth) is not a review at large but is limited only to costs incurred by the administrator that could not have been foreseen at the time he agreed to cap his fees - that proposition being relevant, of course, only to cases in which there is a cap. 3 The case for reopening is put essentially on these bases, although they are amplified, in some ways restated, in the written submissions of counsel for the plaintiffs dated 24 November 2009 which form part of the court file. 4 The defendant does not dispute the power of the court to recall its judgment and to reopen the decision. The defendant emphasises, however, that the power is an extraordinary power that is to be used very sparingly. He says that this is not an appropriate case for the exercise of the power. 5 The principles are, I think, well settled. I would venture to repeat what I said at paragraph 9 of my judgment in Wentworth v Rogers [2002] NSWSC 921 at [9] after reference to relevant High Court authority: "It seems to me that the relevant principles, as they apply in a case such as the present, can be summarised in one basic proposition, namely, that a single judge whose decision is susceptible to appeal through readily available channels (with or without any preliminary need for leave to appeal) should allow re-opening after judgment where it is obvious to that judge that the decision has miscarried and that the miscarriage may be rectified and the situation retrieved by attention to the matter by that judge rather than by an appeal court. What is highly undesirable is that the first instance judge should be cast in the role of hearing what amounts to an appeal against his or her own decision. I adopt, in that connection, the following observation of Rix LJ in Compagnie Noga D'Importation et D'Exportation SA v Abacha [2001] 3 All ER 513: 'I do not wish to say anything against the usefulness of the reconsideration jurisdiction, within its proper limits. I have made use of it myself. However, it is in the nature of the legal process that, once judgment has been rendered, analysis thereafter becomes clarified and refined, and citation of authority is applied to the findings made at first instance so as to illuminate that clarification and refinement of analysis of which I speak. But that is the function of the appeal process. In my judgment, to grant this application that I reconsider my judgment would subvert the appeal process itself. In doing so, it would not answer the interests of justice, but would be the antithesis of justice according to law. There are of course cases where an error of fact or law may be too clear for argument. The best test of that is perhaps – but not necessarily – where the judge himself identifies the error which concerns him. In such a case, it is better that the error is corrected without imposing on the parties the need for an appeal. But no parallel to Noga's application has been cited to me. It is in my judgment wrong for a judge to be treated to an exposition such as would be presented to a court of appeal. If in such circumstances a judge should be tempted to open up reconsideration of his judgment, an appeal would not be avoided, it would be made inevitable. Every case would become subject to an unending process of reconsideration, followed by appeal, both on the issue of reconsideration and on the merits. '" 6 Earlier in that judgment, at [7], I referred to the three matters identified by the High Court as central to the reopening jurisdiction: " first, whether the appellant has shown that, without accident or fault on the appellant's part, he or she has not been heard on a relevant matter; second, whether the appellant has shown an error in the court's reasoning because of a misapprehension of the facts; and third, whether the appellant has shown an error in the court's reasoning because of some misapprehension of the relevant law." 7 The plaintiffs drew attention also, in particular, to another consideration, being a consideration identified by Young J in Twenty-First Australia Inc v Shade (unreported, 31 July 1998, Young J), that is, where the court's reasons for judgment inadvertently did not deal with important matters argued by counsel at the hearing where an appeal to correct this would involve inevitable delay. 8 Mr Golledge, on behalf of the defendant, referred to observations of members of the High Court in Autodesk Inc v Dyason (No 2) [1993] HCA 6; (1993) 176 CLR 300 to the effect that the basic question goes to failure to be heard. 9 The central contention of the plaintiffs is that the judgment of 13 November 2009 proceeded without attention having been given to a particular evidentiary matter, that is, according to the plaintiffs, absence of evidence of the incurring of unanticipated costs. The submission is really that the decision was not warranted by the evidence before the court or was against the weight of the evidence. 10 When one has regard to the defendant's affidavits read in the proceedings, it is by no means obvious that there was a lack of evidence of the kind the plaintiffs say was both crucial and lacking. I refer in particular to paragraphs 11, 29, 30 and 35 of the defendant's affidavit of 5 March 2009 excluding, of course, parts not read or rejected and detailed information elsewhere in that affidavit about the matter in those paragraphs; plus paragraphs 38 to 41 and 43 to 52 of the affidavit of 25 August 2009 excluding a rejected passage. 11 All of that material was squarely before the court upon the application for review. I think this is shown by interchanges between bench and bar on 22 October 2009. 12 The plaintiffs also say the judgment leaves undesirably at large the question whether a review of capped fees is the same as a review of uncapped fees. It is in that context, it is said, that the question of unforeseen work arises. 13 I am inclined to think the matter just mentioned is dealt with in the observations about the nature of a review in paragraphs 74 to 79 of the judgment, viewed in the light of the fact that the existence or non-existence of a cap is but one of the matters directed by s 449E(4) to be taken into account in making the overall assessment of reasonableness that the section requires; also in the treatment of the nature of a "cap" as understood in relevant commercial circles and discussed in the judgment. 14 In short, therefore, it is not obvious that the miscarriage postulated by the plaintiffs has, in reality, occurred in a way that allows the court simply to correct a plainly demonstrated error. 15 For me to go into the question to a greater depth than I have would involve my adopting the altogether inappropriate role of entertaining an appeal from my own decision. 16 The case is not one in which the power to reopen should be exercised. 17 If the matters of concern to the plaintiffs are to be ventilated, they should be ventilated by way of appeal. 18 The notice of motion filed on 19 November 2009 is, therefore, dismissed. [SUBMISSIONS AS TO COSTS] 19 The defendant seeks an order for the costs of the motion and submits that those costs should be assessed on the indemnity basis. 20 In support of the latter proposition, counsel for the defendant refers to a letter sent by the defendant's solicitors to the solicitors for the plaintiffs on the day after the motion was filed inviting withdrawal of the motion and offering not to seek costs of the motion in the event that it was withdrawn. 21 The defendant should have his costs of the motion but I am not satisfied that they should be assessed on the indemnity basis. It does not appear to me that the motion was by any means unarguable and ought to have been recognised at the outset as one that should have been withdrawn. There was no "relevant delinquency" as referred to in Oshlack v Richmond River Council [1993] HCA 11; (1993) 193 CLR 72 on the part of the plaintiffs in pursuing the motion. 22 I therefore order that the plaintiffs pay the defendant's costs of the motion assessed on the ordinary basis. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.