Peter A Clarke

In Eiros Pty Ltd v St George Bank Ltd [2008] FCA 1475 the inimitable Finkelstein J demonstrates that he is gifted with a turn of phrase.  He can be both witty and legallyanalytical when delving into the arid world of statutory demands and costs. 

The issues in this case relate to the setting off of costs orders & whether an appeal constitutes “other grounds” upon which to set aside a statutory demand. Read the rest of this entry »

In Beston Parks Management Pty Ltd & Anor v Sexton & Anor Hollingworth J considered, on an appeal from a decision of a Master, an application for preliminary discovery under Rule 32.05.  The fact situation is familiar to commercial lawyers; executives enter into a agreement(s) upon leaving a company, presumably in exchange for a pay out.  The terms of the agreement(s) contain restrictive covenants preventing them from competing against their erstwhile employer or using confidential information they acquired during their tenure. The company suspects their formally loyal employees are about to set up in competition when they receive emails inadvertently addressed to the loyal troupers care of their previous address.  

The decision is a useful analysis of a procedure which is not used as often as it should be.   All to commonly the plaintiff will issue proceedings with insufficient information and find out, upon discovery that it needs to recast its case or that the initial suspicion falls at the early evidentiary hurdle.  It is one thing to amend a statement of claim to refine the allegations it is an entirely more difficult and fraught exercise to recast a pleading to essentially change the cause of action.  

The practical problem for a potential applicant is not the first pre requisite, knowing whether it might have a cause of action, but rather whether it has or doesn’t have sufficient information to decide whether to commence an action without preliminary discovery and whether it has made “all reasonable enquiries” before making the application. 

Principles Read the rest of this entry »

Nothing like a global downturn to make lawyers brush up on their insolvency law.  The starting point for a creditor winding up a company is the statutory demand.  The Tax Commissioner is a promiscious user of this particular legal scalpel.  So it is timely to consider two recent decisions on statutory demands; Broadbeach and  West International. The High Court decision in Broadbeach is particularly important in limiting the discretion available to the courts when considering an objection to a statutory demand based on an assessment by the Australian Taxation Office. Read the rest of this entry »

When a family falls out sometimes the emotional stress is the easiest thing to resolve.  When property is involved, watch out.  Sivritas v Sivritas involves a son seeking an interest in the family home held in the name of his parents.  The fact situation is depressing familiar, one memmber of the family provides the capital or pays a significant part of the mortgage while the title holder(s) obtain the mortgage because he/she/they have an income and satisfy the bank’s requirement.  All too often there are real problems with proof of who agreed to do what, who contributed what and when and other matters of proof.  Here the original contribution dated back to 1979 with money being used to upgrade the dwelling and the critical dates being in 1984.  In the wonderful world of cash swirling about the court has to determine who to believe about events 20 odd years ago.  It is little wonder that when documents are found they are embraced by the court with like a lifejacket in a ocean storm. 

Putting aside the dense factual recitations Kyrou J’s judgment contains a very clear and useful analsysis on constructive and resulting trusts as they relate to this garden variety family fall out situation.  Read the rest of this entry »

This decision, on an appeal from a Magistrate’s Court decision, provides a useful analysis on reliance in a Trade Practices claim under section 52 (and 82)  and the adequacy of decisions below.  The plaintiff is a real estate agent chasing commission.  It seems to be a grim sub specialty of Magistrate’s Court work. From experience, in the Magistrate’s court it is a tough case to defend if the plaintiff can show there was a sale, notwithstanding complicating issues of agency and whether the agent actually did the work.

The key lesson here is that a plaintiff has to take care in formulating its case at the outset.  Put another way, pleadings matter.  On appeal the respondent had to concede the case was misconceived as pleaded.  The other issue is that in a misrepresentation case just proving some form of misrepresetation is not enough (though even that was not achieved here). Reliance and causation are equally important.  Simple enough one would think.  Surprisingly common to see.    

Features of the decision.    

• Pleading the case properly & proving reliance and causation of loss.  Reliance  - “I did X based on the representation or I wouldn’t have done X if I had known Y & Z is all too often ignored.  Judd J makes that point when he said:

16 It is critical in most trials, as it was in this case, to carefully define conduct alleged to constitute misleading or deceptive conduct for the purpose of a claim made under the Trade Practices Act. The pleading of misleading or deceptive conduct not only defines the evidence concerning the conduct relied upon but is crucial to the issues of reliance and causation. In this case the Magistrate does not appear to have considered reliance or causation. Nor is it apparent that evidence was directed to those issues. While I accept that evidence of reliance is often formulaic and may be unhelpful, or even contrived, there are cases in which there is a real issue of reliance and causation, where evidence must be weighed and a decision made as to whether or not the conduct was relied upon (in this case to enter into the agency agreement) and caused the loss claimed. This is one such case.

• Obligations in giving reasons for decision.  In this case Judd J critisized the Magistrate’s finding of fact and law, that the lease was incapable of being assigned (it was) but also the inadequacy of the reasons for decision.  Judd referred to Fletcher Constructions Australia Ltd v Lions McFarlane & Marshall Pty Ltd (No2)  (extracted in green below) on the three elements required in a statement of reasons.  They are, at [24} :

• The judge needs to refer to the relevant evidence in his decision.  If it isn’t referred to the appellate court may (read will) infer that it was overlooked or didn’t consider it. 

First, a judge should refer to relevant evidence. There is no need to refer to the relevant evidence in detail, especially in circumstances where it is clear that the evidence has been considered. However, where certain evidence is important or critical to the proper determination of the matter and is not referred to by the trial judge, an appellate court may infer that the trial judge overlooked the evidence or failed to give consideration to it … Where conflicting evidence of a significant nature is given, the existence of both sets of evidence should be referred to.

• Set out the material findings of fact and the conclusions & where there is conflicting evidence why one is preferred over the other.

Secondly, a judge should set out any material findings of fact and any conclusions or ultimate findings of fact reached. … [W]here findings of fact are not referred to, an appellate court may infer that the trial judge considered that finding to be immaterial. Where one set of evidence is accepted over a conflicting set of significant evidence, the trial judge should set out his findings as to how he comes to accept the one over the other. … Further, it may not be necessary to make findings on every argument or destroy every submission, particularly where the arguments advanced are numerous and of varying significance …

• The court needs to provide reasons for making hte findings of fact and the application of the law to those facts in an understandable way.

Thirdly, a judge should provide reasons for making the relevant findings of fact (and conclusions) and reasons in applying the law to the facts found. Those reasons or the process of reasoning should be understandable and preferably logical as well.

What Judd J did not say in detail but hinted at at [29]  & [30}when he said:

29 In my opinion, the lack of commerciality of the transaction also interrupts the causal connection between the alleged conduct, as reformulated, and any loss and damage.

30 It is in the interests of justice that this litigation be brought to an end. I dismiss the claim made by Maximum. I will hear the parties on costs.

was that the costs would have been hidieous in this case.  For a claim of $7,500 it is hard to imagine the professional costs and disbursements being less than $30,000 (probably a lot more).  It is little wonder that he brought a halt to it at the appellate level and did not remit it for rehearing.   

In this relatively short judgment Gordon J provdies a good summary of the relevant principles in setting aside a statutory demand and the hearing of an appeal from a Registrar.

Review of Registrars decision

The Federal Court review’s a decision as a hearing de novo.  On review further evidence can be adduced.  Gordon J said at [6]

6 The function of the Court, on review of a Registrar’s decision under s 35A(5) of the Federal Court Act, is to rehear the case and decide the facts for itself. It is a hearing de novo. That is to say, it is a complete rehearing at which the parties may adduce further evidence. It is for the Court to be satisfied of the matters prescribed by the Act and to exercise the discretion unfettered by the decision of the Registrar. The cases that make good those propositions include: Mazukov v University of Tasmania [2004] FCAFC 159 at [22]-[27]; and Martin v Commonwealth Bank of Australia (2001) 217 ALR 634 at [6] and [12] and Callegher v Australian Securities and Investments Commission (2007) 239 ALR 749 at [46].

Principles applicable in setting aside a statutory demand

To set aside a statutory demand the Court has to be satisfied there is a bona fide genuine dispute and the grounds of the dispute have to be real and not spurious.

7 The principles to be applied by the Court in determining an application to set aside a statutory demand are also not in dispute. The Court must be satisfied that there is a genuine dispute between Ultradrilling and West about the existence or amount of the debt to which the demand relates: s 459H(1)(a) of the Act. That issue is determined at the time the Court hears the application: Andi-Co Australia Pty Ltd v Meyers [2004] FCA 1358 at [16]. For a genuine dispute to exist, the dispute must “be bona fide and truly exist in fact”. The grounds for alleging the existence of a dispute must be “real and not spurious, hypothetical, illusory or misconceived“: Spencer Constructions Pty Ltd v G&M Aldridge Pty Ltd (1997) 76 FCR 452 at 464; see also John Holland Construction and Engineering Pty Ltd v Kilpatrick Green Pty Ltd (1994) 14 ACSR 250 at 253 and TR Administration Pty Ltd v Frank Marchetti & Sons Pty Ltd (2008) 66 ACSR 67 at 79.

The Court looks to the affidavit to determine whether there are facts which support a claim to a genuine dispute.  The court should stop there and not test the facts or the merits.  It can be a fine line.  Gordon J said @ [8]:

8 The manner in which the Court approaches the task is also not in dispute. The Court does not resolve contested questions of fact or determine where the merits lie in any contest: Kortz Ltd v Data Acquisition Pty Ltd (2006) 155 FCR 556 at [40]. The Court determines only whether the supporting affidavits filed and served by West depose to facts from which the Court is able to conclude that a genuine dispute exists. As Young J said in John Holland Construction 14 ACSR at 253, something between mere assertion and the proof of the existence of the disputed debt is required: see also Micha International Pty Limited v Jong Seol Lee [2008] NSWSC 921 at [5] and Solarite Air Conditioning Pty Ltd v York International Australia Pty Ltd [2002] NSWSC 411 at [23].

While the court makes a distinction between working out whether the affidavit contains sufficient material to show there is a genuine dispute and working out the merits of the case the analysis by Gordon J is quite thorough and typical of courts considering the contending claims.  In my experience the court goes further than merely establishing there is a genuine dispute based on reasonable grounds but also tests that evidence to the extent it is able to when dealing with affidavit material.  So it is important to have a thorough affidavit both in terms of the factual basis for a claim and the quantum in dispute, especially if there is an offsetting claim. The affidavit should include all relevant dates and details of work done and not done. 

 As his contemporary at Monash University I have watched with amazement, and disbelief, at the rise and rise of Bill Shorten. He was a minor political hack way back when.  That said, one’s stature in university politics rarely reflects one’s real potential.  I don’t judge him by what he did or didn’t do then. I look at his credentials now and compare them to what he does now and find it amazing that he could be regarded as future prime ministerial material.  He has mastered spin and loves to stick his mug in front of the camera.  But as far as intellectual firepower goes he doesn’t match it with Emerson or Tanner.  He doesn’t cut through like Gillard and is far from the star political back room operators as Arbib or Albanese.

He did make his mark during the Beaconsfield mine collapse and all those hours poring over books of quotations and speeches paid off handsomely.  It also helped having fawning press coverage from the master of pap,  Miranda Devine.  But what exactly did he do post or ante then in a substantial way, policy or political wise.  To my mind, his only real strength is working numbers behind the scenes.  Uggh!  In Victoria that should brand you with the mark of Cain.  What political parties need is fewer numbers scroungers and more doing the heavy political lifting, like Lindsay Tanner.

Where Bill really stands out is being able to create the media mythology of being a star ascendant.  The press splashed details of his fortieth birthday party.  They ran stories about the power couple that he and Deb Beale made.  He hyped himself as a player around the traps and a regular Brad and Angelina of the Melbourne ALP.  If you put your relationship out there, which most pollies don’t, then no surprises that when things go busto that will get a splash.  The interesting question is who leaked the story about him taking up with the Governor General’s daughter.  If I had to guess I would say it is one of his legion of non admirers.  Years ago another veteran of Monash student politics, of the left, ventured his theory of Bill,  Bill, this person said, turns over friends such that there is a steadily growing army of Bill haters out there.  This person likened Bill to a surfer riding into shore with a huge waive behind him.  Sooner or later the wave would come crashing down.  I suspect that might be the case.  I am yet to see the skills that Bill supposedly has to warrant him the moniker “future priministerial material.”

Yesterday’s article A thankless job but somebody’s has to do it rates as one of the most vacuous pieces dealing with the ambivalent attitude Australian voters have with their representatives.  It finishes with:

PROOF that public life can be cruel (see left) to politicians and their families is found in the revelation that a rising star of Labor politics, Bill Shorten, has potentially destabilised his career because of a relationship with a woman who happens to be a daughter of the newly appointed Governor-General, Quentin Bryce. Were Mr Shorten not an elected public figure, his recent split with his wife and his new relationship would be no one else’s business. But, on his own and others’ estimation, he is destined to be a political leader, perhaps even a prime minister. For that reason, his private life may have ramifications for his party — and, in this case, the Federal Government. The fact that the Rudd Government is keeping silent over this affair does not alter that.

What doggerel!  A few minor rejoinders:

• Break up of parliamentarians’ marriages are fairly commonplace.  Most rate no mention in the Australian press.  Anyone remember Kim Beazley’s marriage woes.  The press usually avert their eyes EXCEPT when the pollie holds himself out above or beyond.  Or has big time enemies.  Ross Cameron became mildly notorious for outing his affair.  It was an issue because he wore his family values like a suit of political armor.  Bob Woods’ was outed by a jilted lover over travel rorts so his marital problems came out with his travel claims problems.
• The ramifcations if any will be that Bill puts his private and Hollywood lifestyle into the political arena like some visits the smoke filled room lifestyle.  Bill has enemies and this is a bit of ammo that will shoot him where it hurts, his wannabee political superstar image.  If he did what other ambitous politicians do when their party is in power, like working bloody hard and kicking a few goals (as well as being patient) while keeping their personal lives below the radar, then this issue wouldn’t arise.

Bill doesn’t deserve the attention.  His wife doesn’t deserve the humiliation that goes with the story of the marriage break up. Journo’s who cover this story and write such dross don’t deserve a feed.

The Turnbull v Nelson fight is over.  Turnbull is leader by 2 clear votes.  But so what.  A win by one vote for a challenger is enough.  Nelson is onto the back bench and nobody expects much in the way of a return by the good doctor. Turnbull’s first media conference bespeaks his style, a broad sweep grand commentary and one full of optimism and supreme confidence.  That is half the problem.  Will he flame out.  Methinks yes.

The press coverage is all about Turnbull being a force of nature, a doer rather than a talker and a breath of fresh air.  All of that is good and most of it necessary in a new leader.  But the pre requisite of being a successful political leader is having an ideological base, a belief system consistent with that of the party you lead.  Nelson doesn’t have it.  I generally agree with Gerard Henderson’s view on Nelson in today’s SMH where he says:

Nelson’s difficulties go back to a time before he joined the Liberal Party. As the leader of the AMA, he indicated he wanted to enter politics but it was not clear whether he favoured Labor or the Coalition. Then, campaigning in the 1993 election, Nelson declared that up to that time he had never voted Liberal in his life. This seemed plausible. As a medical practitioner running a small business, Nelson was hit by the high interest rates during the early 1990s when Bob Hawke and then Paul Keating were prime minister. Nelson subsequently revamped his position to be that he voted Liberal for the first time in 1990. Either way, his past political allegiance has been ambiguous - something which cannot be said of Menzies or Howard, Hawke or Rudd.

As Opposition Leader, Nelson has scored some short-term hits. Yet he has made no substantial impact, primarily, it seems, because he has no unambiguous positions on economic or social policy. In recent times, Nelson has failed to state an unqualified position on such issues as climate change and Reserve Bank independence. There are many more such examples….

Where I disagree is where he says:

In spite of his relative political inexperience, Turnbull does have firm positions. That’s why he looks like leadership material now that Costello has walked away from the job and now that the Coalition appears to have an ever so slight chance of victory in 2010.

Turnbull’s may state a range of positions but I can’t see the ideological coherence.  He has come out on a few issues against the pack, eg the Henson photos brouhaha, but  hasn’t contribunted much to the political debate.  He was an ambiguous as they come in the constitutional convention and republican movement.  It was classic Turnbull, the results are all that matter no matter what. Turnbull doesn’t have it. Both Nelson and Turnbull are cut from the same cloth ideologically, their belief system is having their boney fingers wrapped around the levers of power.  That lack of coherence brought Nelson undone, as Henderson notes.  It is one of Turnbull’s flaws too. 

The really interesting story is what to make of Pistol Pete Costello.  He sat this one out and was quite dignified in stating his role as being, well, nothing. Except he made his support for Turnbull clear on Radio National this morning.  But, and there is always at least one in politics, Mitch Fifield and Anthony Smith came out to announce their switch from Turnbull on the last occasion to Nelson on the one finished earlier today.  Both are ex staffers of Costello and serious carers for Pistol Pete.  They don’t pack too much in the way in intellectual firepower but are good aparatchiks and every party needs those foot soldiers.  True Nelson supporters filled the airwaves in the 16 or so hours before the vote but Fifield and Smith’s contribution on today’s AM is something else.  Costello is not a Turnbull hugger. That is hardly new.  Thwarting him would be a plus on so many levels.  Nelson’s leadership would have been low hanging fruit closer to the polls. Well it hasn’t worked but that doesn’t mean it is over vis a vis a Costello try on later.  I agree with the musing of Peter Brent that Costello may be waiting for a last minute change before the next election, especially if he remains the member for Higgins into 2009.  

Whatever the ins and outs of the parlimentary machinations it is going to be a grim 12 months for the Federal Opposition. 

Bill Stefaniak is a good guy.  A good local member of the ACT Legislative Assembly for the Liberal member. I knew Bill Stefaniak when I was chief of staff to the Deputy Chief Minister. 

As an ex solicitor in the office of the ACT DPP he had a made to order constituency - the grumpy law and order line. It didn’t hurt that he was a figure of minor prominence in the local rugby community.  When a minister under Kate Carnell he never had to put his “jail is too good for ‘em” rhetoric into action because Gary Humphries was the Attorney General.  Opposition is best suited to those sort of calls.  And soon enough the Libs were out and the ALP back in, where things remain to date. And since finding himself on the opposition benches Bill sounded off long and loud about how the crims got that proverbial easy run.  Read the rest of this entry »

Self represented litigants are God’s way of telling the court to slow down a bit and that barristers haven’t suffered enough. Cases run on and on, judges bend over backwards giving the punter every opportunity to turn the bags of assertions thrown up into something vaguely representing submissions and evidence.  The horror, oh the humanity! 

There is one form of torture even more excrutiating - the friend of the self represented.  Not a lawyer but a wannabee advocate usually.  Often a family member but sometimes a well meaning friend.  Whoever it is it is usually the worst of all worlds for everybody.  This claytons advocate  run the case for the putner but will happily scurry back to the safety of “I am not a lawyer” land when he or she comes under pressure.  In my experience these people are gnerally motivated by altruism, they are a good friend of the punter and are better educated and/or have a better working knowledge of English. Then there is the McKenzie Friend who can assist but not act as an advocate.  In Apostolou the court had to sort out what role the “friend” played.  It became even more complicated when it was clear that the friend had an interest in the defendant’s case. 

Mandie J made some interesting observations about how to approach the issue: Read the rest of this entry »