Nanitsos v Pantzouris [2013] NSWSC 862

Supreme Court New South Wales

Medium Neutral Citation: Nanitsos v Pantzouris [2013] NSWSC 862 Hearing dates: 26 June 2013 Decision date: 26 June 2013 Jurisdiction: Equity Division Before: Lindsay J Decision: 1. Orders for joinder of a defendant. 2. Orders for proceedings to proceed by way of pleadings. 3. Orders for provision of security for costs. 4. Order for dismissal of an application by the plaintiff for disclosure of documents. 5. Order for the plaintiff to pay costs. Catchwords: PROCEDURE - costs - security for costs PROCEDURE - discovery and interrogatories - discovery and inspection of documents PROCEDURE - Supreme Court Procedure - New South Wales - Procedure under Uniform Civil Procedure Rules and other rules of court - Parties - Joinder and addition of parties PROCEDURE - Supreme Court Procedure - New South Wales - Procedure under Uniform Civil Procedure Rules and other rules of court - Parties - Directions Legislation Cited: Corporations Act 2001 (Cth) ss 236-237; 274A Practice Note SC Equity 11 - Disclosure in the Equity Division Cases Cited: Nanitsos v Pantzouris [2012] NSWSC 1396 Category: Procedural and other rulings Parties: D Nanitsos A Pantzouris Representation: D.D Knoll (1st, 3rd to 11th Defendants) D Nanitsos in person Law Corporation Ltd (1st, 3rd to 11th Defendants) File Number(s): 2012/00342791

Judgment - EX TEMPORE 1Before the court today are two notices of motion. The first, in time, is an amended notice of motion filed by the plaintiff on 6 February 2013. The second is a motion filed on behalf of the first and third to 11th defendants (herein after "the defendants") on 8 March 2013. 2With the consent the parties, both motions have today been heard together. 3The plaintiff is self represented. The defendants are represented by counsel and solicitors. 4The second defendant appeared before the court in the character of a witness, or more accurately a potential witness, for the plaintiff. He was invited to participate in the proceedings personally, but he expressed a preference to remain an observer. I infer that, in formal terms at least, his has been a submitting appearance. 5The plaintiff's notice of motion contains a number of claims for relief including, but going beyond, a claim for access to documentation. During the course of the hearing, he expressly abandoned all claims other than that contained in para 5 seeking access to documentation. He did so in the express knowledge, confirmed by a precautionary warning, that that would result in the dismissal of the abandoned claims. 6A consideration of the two notices of motion before the court necessarily, at least incidentally, requires consideration of the nature of the relief sought in the summons filed by the plaintiff on 2 November 2012. 7The claims for relief there made appear, largely, to have been spent during the course of interlocutory disputes that have been litigated to date. 8On 6 November 2012 Justice White, as Equity duty judge, published reasons for judgment which do two things of present relevance. First, they provide general context for the motions before the court today. Secondly, they record undertakings given to the court, by the defendants, relating to access to documentation to be allowed to the plaintiff, in the ordinary course of conduct of the affairs of the company which is central to the proceedings. His Honour's judgment is reported as Nanitsos v Pantzouris [2012] NSWSC 1396. 9The company, Pan Macedonian Greek Brotherhood (Alexander the Great) NSW Limited ABN 92 060 985 953, is not yet a party to the proceedings. The defendants' motion includes an application for its joinder. 10It is, in my assessment, a necessary party to the proceedings. Its books and records lie at the heart of the plaintiff's claims of entitlement to inspect records. 11The plaintiff claims, in a broad sense at least, to be pursuing the principal proceedings for the benefit of the general membership of the company and to preserve the company's property. 12The defendants are sued on the basis of allegations, not fully articulated, of misconduct by them in their character as officers of the company. 13The plaintiff has not, so far at least, articulated a claim of entitlement to bring a "representative action" based upon an application under ss 236-237 of the Corporations Act 2001 (Cth), or otherwise. 14Although he has, in the course of oral submissions, made a range of allegations suggestive of impropriety of one sort or another, or of diversions of property of the company, the allegations thus far made are at a level of generality that cannot be tested. They are accompanied by persistent demands for access to a full, indeterminate range of the company's records. 15The evidence before the court demonstrates that the defendants have actively endeavoured to meet the obligations they assumed in giving undertakings to the court about the availability of documentation to the plaintiff. 16The time is fast approaching when, if he is to maintain the principal proceedings, the plaintiff should be required to plead and particularise a case. Indeed, it has arrived. 17Without the addition of precision to his contentions, it is difficult to justify any order for access to company documentation (under s 247A of the Corporations Act or otherwise) going beyond the ambit of the defendants' continuing undertakings. No such order should be made today. 18If the principal proceedings are to be pursued, regard also needs to be had to the desirability of all parties, including the plaintiff, conforming with the usual practice and procedure of the court in relation to the disclosure of documentation: see Practice Note SC Equity 11 - Disclosure in the Equity Division. 19The defendants' motion includes an application for security for costs. 20The motion has been supported, inter alia, by the service on the plaintiff of a notice to produce documentation relating to his financial affairs. 21In substance, the plaintiff declined to produce any documentation at all when the notice to produce was called upon. He claimed the status of an impecunious pensioner. He also invited the Court to proceed on the basis that, if any order for security were to be made against him, it would stultify the proceedings. 22The plaintiff's declaration of a lack of means led the defendants to moderate their claim for security by proposing a procedure that would permit a small amount of security to be ordered in the first instance, reserving to them an opportunity to apply for further security should they be so advised. 23Having reviewed the summons, the parties' respective notices of motion and the evidence adduced on the hearing of the motions, and having entertained both written and oral submissions (on both sides of the record) referable to the motions, I have formed the view that the plaintiff should be required, at this stage of the proceedings, to provide a modest amount of security for the costs of the defendants. 24One of the factors taken into account in reaching that view is the protestation on the part of the plaintiff that he has no personal interest in the conduct of the proceedings because, he says, he is acting in the interests of his fellow members of the company, albeit members whose identity he cannot or will not specify. 25An element of complexity is added to the plaintiff's case by his insistence that he not be required to disclose to the defendants, or even to the lawyers of the defendants, his residential address. His summons and other Court documentation disclose no more than a post office box address for him and a mobile phone number. 26In the course of debate on the motions, the defendants sought, and the plaintiff agreed, that there be an order of the Court permitting service of documentation and notice on the plaintiff via a nominated e-mail address. Given that I have determined to allow the plaintiff some procedural leeway in connection with disclosure of his residential address, it is appropriate that an order be made, as sought, for service on him via e-mail. 27I propose to make an order that the plaintiff provide, at this stage of the proceedings, security for costs in the sum of $5,000. 28I have little doubt that the costs of the defendants will exceed that sum if the plaintiff chooses to maintain the proceedings by the filing of a statement of claim. It is, accordingly, appropriate, to reserve to the defendants liberty to apply for an increase in the security required of the plaintiff. 29I propose to reserve liberty to apply generally on that topic, but with an indication that the security today ordered is, within the current contemplation of the parties and the Court, intended to serve continuation of the proceedings up to and including the time of the defendants filing a defence. 30I make this observation subject to a qualification. 31That qualification is that recognition must be given to the possibility that, if the plaintiff renews applications for the production of documents before the time arrives for the defendants to file their defence, he will do so against a risk, not only of orders for costs, but also of an application for an increase in his provision of security. 32The defendants seek an order that the plaintiff pay the costs of the motions before the Court. They put their claim of entitlement to costs on a number of bases, one of which is that the plaintiff has endeavoured to re-litigate matters decided by Justice White. 33It is sufficient, for current purposes, to observe that there is, in my assessment, no basis for departure from the general rule of practice that costs follow the event. 34I record the defendants' concern about their exposure to repetitive applications on the part of the plaintiff against the possibility that it may be necessary, at a future stage of the proceedings, to look more closely at the course of the proceedings and the duplication of business conducted. 35I make the following orders and notations: (1) Order that Pan-Macedonian Greek Brotherhood (Alexander the Great) NSW Ltd, ABN 92 060 985 953, be joined in the proceedings as a party defendant. (2) Order that Pan-Macedonian Greek Brotherhood (Alexander the Great) NSW Ltd be designated the twelfth defendant. (3) Order that the proceedings proceed by way of pleadings. (4) Order that, subject to these orders, the plaintiff file and serve a statement of claim (with verification) within 28 days. (5) Order that, subject to compliance with order 6, the plaintiff be at liberty to file that statement of claim without disclosure therein of his residential address. (6) Order that, at the time of filing any statement of claim, the plaintiff provide to the Court a written statement setting out his residential address and other contact details. (7) Order, subject to further order, that any such written statement be retained by the Court, without publication to any party or other person, in a sealed envelope marked "Not to be opened without an order of the Court". (8) Order, subject to further order, that the plaintiff, within 28 days, provide security for costs of the proceedings in the sum of $5,000 by payment into court or otherwise in a form acceptable to the Registrar. (9)Order, subject to further order, that the proceedings be stayed pending the plaintiff's compliance with order 8. (10) Note that the undertaking to the Court given by the 1st and 3rd to 11th defendants (hereinafter "the defendants") recorded in paragraph 20 of the reasons for judgment published by White J on 6 November 2012 (as Nanitsos v Pantzouris [2012] NSWSC 1396) is continuing. (11) Note (without prejudice to such, if any, rights as the plaintiff might in the future have under s 247A of the Corporations Act 2001 (Cth)) that, should the plaintiff hereafter seek orders for discovery or otherwise for the production of documents in the course of these proceedings, consideration will need to be given by the Court, and the parties, to the operation of the Court's Practice Note SC Eq 11 relating to disclosures. (12) Order that the plaintiff's amended notice of motion filed 6 February 2013 be dismissed, including the application made by the plaintiff (by reference to s 247A of the Corporations Act or otherwise) for the disclosure to him of documentation of the twelfth defendant. (13) Order that the proceedings be listed for directions before the Registrar on Wednesday 28 August 2013 at 9am. (14) Order that the plaintiff pay the defendants' costs of his amended notice of motion filed 6 February 2013 and the costs of the defendants' notice of motion filed 8 March 2013, as agreed or assessed, on the ordinary basis. (15) Reserve to the defendants liberty to apply: (a) for a variation of order 8 relating to the quantum of the security for costs to be provided by the plaintiff; or (b) for an order for dismissal of the proceedings should the plaintiff not comply with order 8. (16) Order that the plaintiff notify the solicitor for the defendants, in writing, of the fact of any payment of money into court, or the provision of any other form of security for costs, within 48 hours of the provision of that security. (17) Order, subject to further order, that service of documents and notice on the plaintiff may be effected via an e-mail addressed to xxxxxxxxxxxx@gmail.com.