District Court New South Wales Medium Neutral Citation: Aquaqueen International Pty Ltd v Titan National Pty Ltd (No. 3) [2014] NSWDC 219 Hearing dates: 9 October 2014 Decision date: 09 October 2014 Jurisdiction: Civil Before: Gibson Decision: (1) Mrs Penson and Aquaqueen International Pty Ltd called outside Court 13D three times at 9:36am - no appearance. (2) Mrs Penson and Aquaqueen International Pty Ltd called outside Court 13D three times at 10:05am - no appearance. (3) Notice of motion filed on 25 August 2014 dismissed. (4) Applicants pay the respondents' costs on an indemnity basis in the lump sum of $5,700. Catchwords: PRACTICE AND PROCEDURE - application under UCPR r 36.16 to set aside or stay orders made in the applicants' absence - failure to make application in proper form for an adjournment - failure to provide adequate documentary evidence in support - failure to provide material as to reasonable prospects of success - application dismissed COSTS - application for lump sum costs under s 98(4)(c) Civil Procedure Act 2005 (NSW) - prior lump sum costs orders made against the applicants in this litigation - lump sum costs order made Legislation Cited: Civil Procedure Act 2005 (NSW), ss 57(1)(d) and 98(4)(c) Legal Profession Act 2004 (NSW), s 384 Uniform Civil Procedure Rules 2005 (NSW), r 36.16 Vexatious Proceedings Act 2008 (NSW) Cases Cited: Aquaqueen International Pty Ltd v Titan National Pty Ltd [2014] NSWDC 79 Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 Bailey v Marinoff (1971) 125 CLR 529 Coren v Master Builders Association of New South Wales Pty Ltd [2014] NSWCA 244 Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230 Roskott v Commonwealth Bank of Australia [2014] NSWCA 341 Wentworth v Woollahra Municipal Council (No 2) (1982) 149 CLR 672 Texts Cited: - Category: Principal judgment Parties: First Applicant: Aquaqueen International Pty Limited (ACN 094 129 389) Second Applicant: Shirley Penson First Respondent: Titan National Pty Limited (ACN 092 896 029) Second Respondent: Kathryn Wood-Weber Representation: Applicants: No appearance Respondents: Ms C Perry (solicitor) Plaintiffs: No appearance Defendants: Pure Legal File Number(s): 2009/337626; 2014/17976; 2014/137439 Publication restriction: None Judgment 1The applicants, Aquaqueen International Pty Ltd and Mrs Shirley Penson, by notice of motion filed 25 August 2014, seek the following orders: (1)Stay the orders made on 19/08/2014 until further orders of the court; (2)Pursuant to r 36.16 of the UCPR, set aside and/or vary the judgment orders made on 19/08/2014 in matters 2009/337626, 2014/17976 and 2014/137439; (3)Hear the Notices of Motion filed on 15/05/2014, 22/05/2014, 01/08/2014 respectively in matters 2009/337626 and 2014/137439, and the defendants' remaining Notice of Motion filed on 04/04/2014 in 2014/17976; (4)Costs; (5)Any such other orders the court sees fit. 2The applicants rely on the affidavit of Shirley Penson affirmed on 25 August 2014. Background 3The applicants commenced proceedings in 2009. The applicants lost the proceedings and on 24 June 2011 the trial judge made costs orders against them. The costs were assessed and that assessment was referred to the Costs Review Panel. On 28 May 2014 I dismissed an appeal under s 384 Legal Profession Act 2004 (NSW) brought by the applicants (in proceedings 2009/337626). That appeal, although originally brought in relation to the whole of the costs claimed, was limited to a challenge to a few thousand dollars: Aquaqueen International Pty Ltd v Titan National Pty Ltd [2014] NSWDC 79 at [2]. All those costs remain outstanding, apart from the sum of $20,000 which Truss DCJ, in the course of case-managing the appeal, ordered the applicants to pay by way of security for costs. Mrs Perry informs the court that her clients' costs in relation to this litigation, in which they were the defendants, are in excess of $250,000, and that apart from one lump sum costs order in the Supreme Court for $2,500 (in relation to matters not before this court), costs remain unpaid by the applicants. 4I also ordered that the applicants pay the costs of the appeal. The respondents brought an application for those costs to be paid on an indemnity basis and in the form of a gross sum costs order. The applicants responded by bringing a stay application. 5Both these applications came before Balla DCJ for hearing on 1 August 2014. Balla DCJ rejected the application for a stay of proceedings and made orders as follows: (1)Dismiss Notice of Motion filed 11/7/14 and Amended Notice of Motion. (2)Leave given to Plaintiff to file an Amended Notice of Motion in Court today. (3)Notice to Produce set aside. (4)Plaintiff and Ms Penson personally to pay costs of 1st and 2nd Defendants on the Notice of Motion filed 11/7/14 and Amended Notice of Motion on an indemnity basis. (5)1st and 2nd Defendants' application for costs to be paid by way of a fixed costs order s/o before Judge Gibson who is hearing other costs matters on 8/8/14. (6)Affidavit in support of that application to be served on Ms Penson by 7/8/14. (7)Confirm listing before Judge Gibson on 8/8/14. 6This final order referred back to me, for hearing, the respondents' application for a gross sum costs order (s 98(4)(c) Civil Procedure Act 2005 (NSW)). On 8 August 2014, the applicants sought an adjournment on the basis that the affidavit material had been served late, and the proceedings were stood over to 19 August 2014. The applicants also made a fresh application for a stay of proceedings and raised a relatively trivial complaint about the form of the Notice of Change of Address for Service filed by Mrs Perry. 7I made the following orders on that day: (1)Grant leave to Christine Perry of Pure Legal to file a Notice of Change of Address for Service in court today, noting that this applies retrospectively in that Ms Perry has been at all relevant times the solicitor for the defendants. (2)The plaintiff/respondent and plaintiff/applicant is to provide written submissions in relation to all outstanding issues by 4:00pm Monday 18 August 2014. (3)On the application of Ms Penson, by reason of the asserted late service of the documents on 7 August 2014, the hearing of these proceedings has been adjourned and will continue by written submissions. (4)Matter relisted for directions on Tuesday 19 August 2014 at 9:00am on the understanding that her Honour will prepare a judgment based upon the material set out in the written submissions and that if no submissions in reply are received by Monday 18 August 2014 at 4:00pm the orders sought by Titan National Pty Ltd will be made. (5)No further notices of motion are be filed by any party and no further extensions of time will be granted to either party. (6)No further correspondence are to be directed to Gibson DCJ's chambers other than submissions prepared by Ms Penson or her legal representatives. (7)Costs reserved. (8)Note the additional lump sum cost of today, if the lump sum costs order is made, is $1,000 (for all three matters). 8On 19 August 2014 I heard the applications and, following an ex tempore judgment, made the following orders in each of the court files: Aquaqueen International Pty Ltd v Titan National Pty Ltd (2009/337626) (1)The plaintiff's application made on 17 August 2014 for further adjournment of these adjourned proceedings is dismissed with costs. (2)The notice of motion filed by the plaintiffs on 15 May 2014 is dismissed. (3)The plaintiffs are to pay the costs of the costs appeal and subsequent applications including notices of motion in 2009/337626, 2014/17976 and 2014/137439 on an indemnity basis. (4)Plaintiffs pay first and second defendants' costs of the appeal and the proceedings before Balla DCJ in a total gross fixed sum of $77,747.78, giving the plaintiffs credit of $20,000 for security for costs, making a judgment sum of $57,747.78. (5)The defendants pay interests on costs pursuant to s 101(4) and (5) Civil Procedure Act 2005 (NSW). (6)Note that the Notice of Change of Address for Service filed in these proceedings as Exhibit B takes effect retrospectively, and pursuant to s 14 Civil Procedure Act 2005 (NSW), I waive compliance with any failure to comply with the provisions of the Civil Procedure Act 2005 (NSW) or Uniform Civil Procedure Rules 2005 (NSW). (7)Exhibit retained for 7 days. Aquaqueen International Pty Ltd-v-Titan National Pty Ltd (2014/17976) (1)The notice of motion filed 4 April 2014 is dismissed. (2)The notice of motion filed 7 May 2014 is dismissed. (3)The notice of motion filed 25 July 2014 is dismissed. (4)Any costs payable by the plaintiffs are to be paid in accordance with Gibson DCJ's judgment of 19 August 2014 (see 2009/337626) or Balla DCJ's judgment of 1 August 2014. (5)Any application by the plaintiffs for costs from the defendants is dismissed. Titan National Pty Ltd-v-Aquaqueen International Pty Ltd (2014/137439) (1)The notice of motion filed 22 May 2014 is dismissed. (2)The notice of motion filed 1 August 2014 seeking a stay and mediation is dismissed. (3)Any costs payable by Aquaqueen International Pty Ltd and/or Mrs Shirley Penson are to be paid in accordance with Gibson DCJ's judgment of 19 August 2014 (see 2009/337626) or Balla DCJ's judgment of 1 August 2014. (4)Any application by Aquaqueen International Pty Ltd and/or Mrs Shirley Penson for costs from the plaintiffs is dismissed. The history of this motion 9This motion was filed without leave, in circumstances where there was no appeal from either of my judgments or the judgment of Balla DCJ, and listed for hearing on 26 September 2014 by the Registry. Mrs Penson advised the Registry this return date was inconvenient because she was involved in other proceedings in the Supreme Court on that same day. The motion was given a second list date of 5 October 2014. 10On 12 September 2014, the applicants wrote to the court enquiring if the matter was listed for hearing or for directions only. The proceedings were adjourned for a third time, to 9 October 2014, for a hearing fixed before me at 9.30a.m. 11On 26 September 2014, Mrs Penson advised the respondents and this court that she had to travel overseas on business. She also sent the following letter to the respondents in relation to all of the proceedings on foot between them, including the winding up proceedings being brought in the Supreme Court by the respondents: "We refer to the above matter and note that one of the Substituting Creditors, namely, "Kathryn Wood-Weber" has been mentioned in recent documentation as "Kathryn Wood" without qualification or appropriate formality. As you are well aware, Titan National Pty Ltd, a holding company, has transferred the property assets without monetary considerations earlier this year. Furthermore, we have addressed our concerns with your legal representatives in regard to prospective costs that may be ordered against you in the present court proceedings in both the Supreme Court and District Court, as well as costs being assessed in the costs assessment in progress against Titan National Pty Ltd and Kathryn Wood-Weber (in Supreme Court case number 2014/166362). We hereby formally demand that within the next five days, i.e. by 4:00PM 30 September 2014, that you produce reasonable documentation to support the financial position of Titan National Pty Ltd and Kathryn Wood-Weber respectively. Failing receipt of which, we will proceed to issue a subpoena to produce without any further notice to you. This letter is also being sent to the registered office of Titan National Pty Ltd to ensure your safe receipt." 12This letter is of concern to Ms Perry. Her client's change of surname arises from a divorce and should be uncontroversial. There is no basis upon which the applicants are entitled, either in this litigation or in the winding-up proceedings, to information about the second respondent's financial circumstances, or those of the respondents in these proceedings, which are now finalised. The letter does not indicate in which court the subpoena will be issued, but if it were to be issued in this court, given the concluded nature of these proceedings, it could amount to an abuse of process. 13On 1 October 2014 Mrs Penson sent a follow up letter confirming that she would be absent from Australia, and asking for the proceedings to be adjourned to the week commencing 27 October 2014. However, neither the letter of 26 September 2014 nor the letter of 1 October 2014 offer any explanation as to when and in what circumstances Mrs Penson learned she needed to travel to China on Friday 3 October 2014 for "approximately one week" (letter of 1 October 2014). The sole supporting document provided to the court, attached to the letter to the Listing Officer of 26 September 2014, is untranslated correspondence in the Chinese language. Mrs Perry has informed me this morning that this document had not been sent to her by the applicants. She was in no position to have its contents translated this morning. 14The text of this document is as follows: "有关第G951874号商标诉讼案,我方于2014年9月19日寄出的有关案件中止审理申请书, 法院已经受到。 之前法院曾就改案下发«举证通知书»要求在2014年9月26日前提校正据。鉴于该案商标评审案员会作出驳回决定,引证商标为第1265190号商标,且由于该案至今未审,因此本案应没有需要提交的新的证据材料。 该案如有任何新的进展,我方将及时向您转达。 您如有任何问题,请随时与我方联系 顺颂商祺" 15Thanks to my associate, I can assist Mrs Perry's understanding of it, by advising that the letter is written by a Ms Chendong Mao and that the email address is an intellectual property rights office in Beijing (北京安度凯特来知识产权代理有限公司). Contrary to Mrs Penson's claim that this email advises her of an "increasingly urgent" need to "leave Australia as soon as possible", the email does not refer to any urgency at all. It refers to court proceedings pending in China where orders were made for the provision of evidence, that the trademark commission had made a determination, and that there should be no need for the parties to provide evidence in the Chinese court proceedings. 16Ms Mao concludes by inviting Mrs Penson or Aquaqueen to contact her office should they have further questions, language hardly consistent with an expectation that Mrs Penson was planning a trip to China. 17There is thus no reference in this email to what Mrs Penson has called a "China Hearing Date" (Email of 8 October 2014, Exhibit D) or to any expectation that Mrs Penson needed to travel there. Additionally, the document attached is only page 1 of a 6-page email, in circumstances where the whole of the document should, in the interests of fairness, have been provided. The applications before the court 18The applicants seek the adjournment of their stay application. The respondents oppose this application. 19As I was absent overseas when Mrs Penson contacted the court, she was provided with a copy of the decision of the New South Wales Court of Appeal in Roskott v Commonwealth Bank of Australia [2014] NSWCA 341, where, in similar circumstances, a late application was made to adjourn proceedings in the Court of Appeal on the basis that the applicants had to travel interstate on business. Basten JA explains the appropriate course to take in such circumstances as follows (at [14]): "The appropriate course to take in these circumstances is that which was adopted by the Court in Kyriakou v Long [2014] NSWCA 308. In that case the applicant also failed to appear, the Registrar having been advised early on the morning of the hearing by a housemate that the applicant was ill. The application for an adjournment was refused and the application for leave to appeal dismissed. All parties, including, but not limited to, litigants in person, should understand that proceedings listed in this Court will not be vacated on the basis of an email communication to the Registrar at short notice. Where the application before the Court does not appear, on the basis of the documentary material filed, to have reasonable prospects of success, it is almost inevitable that the proceedings will be disposed of adversely to the applicant's interests. Where such adverse orders are made in the absence of a party the Court has power to set aside or vary such an order: Uniform Civil Procedure Rules 2005 (NSW), r 36.16. Generally, however, such a power would only be exercised, upon an applicant - (a) seeking by notice of motion to vary the order made; (b) the motion being supported by affidavit evidence annexing all relevant documentation (such as a detailed medical certificate demonstrating incapacity), and (c) material demonstrating reasonable prospects of success in the substantive application before the court. Where such steps have been taken expeditiously and with proper notice to the other party, the court will entertain an application to vary an order made in the absence of the applicants. Given the existence of such a power, the desirability of disposing of proceedings when they are listed for hearing, and where they appear to have no merit, is a consequence of the need to protect a respondent from wasted costs." 20Although the applicant in these proceedings has given a slightly longer period of notice of her adjournment application, she has failed to comply with the steps required by the Court of Appeal in [14](a) - [14](c) above: (1)Firstly, no application for adjournment in proper form was brought by the applicants prior to Mrs Penson's departure overseas. (2)Secondly, the documentary evidence is limited and contradictory in nature. The provision of an untranslated email which is part of a much longer document cannot constitute "all relevant documentation". The untranslated document is noted on the chain of emails as being page 1 of 6 pages. Further, Ms Perry was denied the opportunity to comprehend the contents of this email; Ms Perry was neither given this document nor is she able to read Chinese. (3)Thirdly, there is no material as to the reasonable prospects of success. 21As to the merits of the application to set aside one or more of the previous orders made by this court, UCPR r 36.16 provides: "36.16 Further power to set aside or vary judgment or order (1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order. (2) The court may set aside or vary a judgment or order after it has been entered if: (a) it is a default judgment (other than a default judgment given in open court), or (b) it has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order, or (c) in the case of proceedings for possession of land, it has been given or made in the absence of a person whom the court has ordered to be added as a defendant, whether or not the absent person had notice of the relevant hearing or of the application for the judgment or order. (3) In addition to its powers under subrules (1) and (2), the court may set aside or vary any judgment or order except so far as it: (a) determines any claim for relief, or determines any question (whether of fact or law or both) arising on any claim for relief, or (b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief. (3A) If notice of motion for the setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may determine the matter, and (if appropriate) set aside or vary the judgment or order under subrule (1), as if the judgment or order had not been entered. (3B) Within 14 days after a judgment or order is entered, the court may of its own motion set aside or vary the judgment or order as if the judgment or order had not been entered. (3C) Despite rule 1.12, the court may not extend the time limited by subrule (3A) or (3B). (4) Nothing in this rule affects any other power of the court to set aside or vary a judgment or order." 22Mrs Perry has referred, in her submissions this morning, to Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 301 - 3 and to Wentworth v Woollahra Municipal Council (No 2) (1982) 149 CLR 672 at 684. The short answer is that, apart from the very narrow exceptions set out in UCPR r 36.16 above, judgments and orders which have been recorded and entered can only be discharged on appeal: Bailey v Marinoff (1971) 125 CLR 529 at 530. As the Court of Appeal noted in Coren v Master Builders Association of New South Wales Pty Ltd [2014] NSWCA 244, the appropriate course was always for the applicants to seek leave to appeal, and not to bring applications for stays or for the setting aside of the orders made by myself and Balla DCJ, which orders have effectively disposed of all issues in these proceedings, including the notices of motion referred to by Mrs Penson in her email of 7 October 2014 (which was on-forwarded to the court on 8 October 2014). The desirability of disposing of proceedings when they are listed for hearing is of particular importance where those proceedings have been the subject of final disposition, as is the case here. Additionally, s 57(1)(d) Civil Procedure Act 2005 (NSW) refers to the timely disposal of proceedings, which in the present circumstances is of particular importance: Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230. In addition, as Basten JA pointed out in Roskott v Commonwealth Bank of Australia, these proceedings clearly have no merit, as there is no basis upon which the applicants should be able to deny the respondents the fruits of their victory given that there is no appeal process on foot. 23For the reasons set out above, the application for adjournment should be refused and the notice of motion dismissed with costs. 24Conformably with my earlier orders in relation to the respondents' application for a gross sum costs order, I propose to make an order, pursuant to s 98(4)(c) Civil Procedure Act 2005 (NSW), that the applicants pay the costs of the respondents for the lump sum sought by Ms Perry in the hearing before me this morning. Those costs are substantial, because of the repeated adjournment of the hearing date and the correspondence between the parties. 25Ordinarily Mrs Perry would be required to set out these costs in detail in an affidavit, but in view of the total lack of merit of the application, the failure of the applicants to provide evidence in English and the contumelious conduct of Mrs Penson, I propose to treat this application as a continuation of the existing gross sum indemnity costs order and to award the total costs of her work in progress, less the same 5% percentage. As the total work in progress figure is rounded off to $6,000, the gross sum costs order is accordingly $5,700. 26Mrs Perry submits that the applicants' conduct of these proceedings has bordered on the vexatious. The court registry cannot stop the applicants from filing notices of motion or subpoenae; appropriate orders for a declaration under the Vexatious Proceedings Act 2008 (NSW) would have to be made in the Supreme Court. I note the respondents' winding up proceedings are listed in the Supreme Court tomorrow for final orders; it will be for Mrs Perry to take this complaint up with the Supreme Court if so instructed. Orders (1)Mrs Penson and Aquaqueen International Pty Ltd called outside Court 13D three times at 9:36am - no appearance. (2)Mrs Penson and Aquaqueen International Pty Ltd called outside Court 13D three times at 10:05am - no appearance. (3)Notice of motion filed on 25 August 2014 dismissed. (4)Applicants pay the respondents' costs on an indemnity basis in the lump sum of $5,700. ********** 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. Decision last updated: 11 December 2014