FEDERAL COURT OF AUSTRALIA

Revian v Dasford Holdings Pty Ltd [2001] FCA 777

PROCEDURE – application in representative proceeding – application in form 5 – application required to be in form 129 – whether applicant should be granted leave to amend application – whether irregular application should be struck out – whether court entitled to treat irregular application as invoking its jurisdiction – whether irregularity invalidates proceeding

Federal Court of Australia Act 1976 ss 33H, 33J, 51

Sereika v Cardinal Financial Securities Ltd [2001] FCA 208 cited

Re Healey; Re Inquiry into Election in Australian Workers Union, South Australian Branch (1992) 40 IR 110 referred to

Re Federated Furnishing Trade Society of Australasia (1993) 113 ALR 137 cited

KANDI LEE REVIAN (FOR AND ON BEHALF OF HERSELF AND AS JOINT TRUSTEE FOR THE GKDK TRUST AND AS A REPRESENTATIVE OF THE GROUP MEMBERS REFERRED TO IN THE APPLICATION) v DASFORD HOLDINGS and ORS

W 101 of 2001

RD NICHOLSON J

27 JUNE 2001

PERTH

THE COURT ORDERS THAT:

1.                  The motion on behalf of the first, second and third respondents dated 17 May 2001 is refused.

2.                  The time limited by the Rules of the Federal Court for the filing and service of the applicant’s motion dated 24 April 2001 be abridged.

3.                  Paragraph 2 of the applicant’s motion dated 24 April 2001 is granted and leave is granted to the applicant to amend her application by substituting the application identified as annexure KLAR 1 to the applicant’s affidavit sworn on 24 April 2001 and which otherwise complies with the requirements of the Federal Court Rules.

4.                  Paragraph 3 of the applicant’s motion dated 24 April 2001 be dismissed.

5.    (a)   The respondents pay the applicant’s costs in respect of the applicant’s motion referred to in order 3.

5.  (b)   The first to third respondents pay the applicant’s costs of their motion referred to in order 1.

6.                  It is declared that this proceeding is not invalid by reason of the irregularity in the applicant filing an application in Form 5 rather than Form 129.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

1                     For the applicant a motion is brought seeking leave to substitute for the original application filed an application now tendered to the Court.  Additionally, leave is sought to dispense with the requirements of compliance with s 33J of the Federal Court of Australia Act 1976 on certain conditions.

2                     In response to the applicant’s motion the first, second and third respondents bring a motion seeking to have the originating application set aside and further or consequential orders.

3                     The applicant comes before the Court as a person who is one of the seven or more persons alleging claims against the same respondents and as representing some or all of them.  She is unrepresented.

4                     The original application as filed on 6 April 2001 was an application in the form of an application generally used before the Court but not one qualifying in respect of the requirements set out in s 33H in respect of originating process in a representative proceeding.  That section reads as follows:

“33H(1)          An application commencing a representative proceeding, or a document filed in support of such an application, must, in addition to any other matters required to be included:

(a)               describe or otherwise identify the group members to whom the proceeding relates; and

(b)               specify the nature of the claims made on behalf of the group members and the relief claimed; and

(c)                specify the questions of law or fact common to the claims of the group members.”

The applicant’s motion is supported by a proposed application which, it is not disputed, would meet the requirements of s 33H.

5                     The applicant relies upon the Court’s powers in O 13 r 2(1) of the Federal Court Rules (“FCR”) as the source of power for the Court to substitute the application.  That Rule reads:

“2(1)   Subject to the following provisions of this rule, the Court may, at any stage of any proceeding, on application by any party or of its own motion, order that any document in the proceeding be amended, or that any party have leave to amend any document in the proceeding, in either case in such manner as the Court thinks fit.”

That is to be read subject to O 13 r 2(2), which reads:

“2(2)   All necessary amendments shall be made for the purpose of determining the real questions raised by or otherwise depending on the proceeding, or of correcting any defect or error in any proceeding, or of avoiding multiplicity of proceedings."

Other sub-rules contemplate amendments to the document rather than substitution of the document itself.  However, O 13 r 2(7) reads:

“An amendment may be made notwithstanding that the effect of the amendment will be to add or substitute a new claim for relief or another foundation in law for a claim for relief if the new claim for relief or foundation in law for that claim arises out the same facts or substantially the same facts as those already pleaded to support existing claims for relief by the party applying for leave to make the amendment.”

6                     The form of amendments proposed would in effect utilise Form 129, being the form prescribed for applications in relation to representative actions rather than the Form 5 wrongly utilised in the original process.  The identical relief is sought in both applications. 

7                     In support of the motion for the first to the third respondents it is submitted that because the original application did not comply with the requirements of s 33H, the proceeding was not properly commenced.  Accordingly, it is said no leave should be given to amend the original process by substituting the proposed form of amended application.  It is also submitted that the application as filed and the statement of claim which accompanied it failed to comply with the provisions of FCR O 11 r 1A in that they did not set out the name of the person who prepared the pleading or include a statement by the person who did so identifying him or herself.  It is submitted that it is open to the Court to infer that the person who did so was a person who had been found by the Legal Practitioners Complaints Committee to be guilty of unprofessional conduct resulting in his suspension from practice and a recommendation by the Legal Practitioners Disciplinary Tribunal to the Supreme Court that he be no longer permitted to practice as a legal practitioner.  The importance of compliance with O 11 and with s 33H was a matter referred to by the Court in Sereika v Cardinal Financial Securities Ltd [2001] FCA 208 at [2] per Tamberlin J.  Given the alleged circumstances of the person said to be the author of the application and claim, it is said the Court should infer that there was a deliberate non-compliance with FCR O 11.  Generally it is submitted that either the application should be struck out or leave should be given to withdraw it and to commence a fresh application in terms of the proposed amended application.

8                     Counsel for the fourth and fifth respondents generally supported these submissions for the first to third respondents.  He referred to FCR O 13 r 3(1) which provides that a party may, without leave, amend any pleading of his once at any time before the pleadings are closed.  However, the word “pleading” is defined in O 1 r 4 excludes an application.

9                     Section 33K(1) of the Federal Court Act provides that the Court may at any stage of a representative proceeding, on application made by the representative party, give leave to amend the application commencing the representative proceeding so as to alter the description of the group.  That is a specific power of amendment contained in Pt IVA relating to representative proceedings.  Given that the power to which it relates concerns a specific aspect of representative proceedings (namely, the description of the group) I do not consider that the presence of that power in that section precludes the application of the powers arising under FCR O 13.

10                  The power to commence a representative proceeding provided for in s 33C(1) is “subject to this Part” – that is the provisions of Pt IVA.  Included in that Part is s 33H.  The terms of s 33H, which have been set out above, are on their face mandatory.  That is, it is a requirement of the Act that an application commencing a representative proceeding “must” comply with the requirements of that section.  Does non-compliance (in this case by the filing of an application in compliance with Form 5 rather Form 129) invalidate the proceeding? 

11                  Section 51(1) of the Federal Court Act provides that no proceedings in the Court are invalidated by “a formal defect or an irregularity” unless the Court is of the opinion that substantial injustice has been caused by the defect or irregularity and that the injustice cannot be remedied by an order of the court.  Subsection (2) provides that the Court or a Judge may, on such conditions (if any) as the Court or Judge thinks fit, make an order declaring that the proceeding is not invalid by reason of a defect that it or he or she considers to be formal, or by reason or an irregularity.

12                  In Re Healey; Re Inquiry into Election in Australian Workers Union, South Australian Branch (1992) 40 IR 110 at 118 – 19, O’Loughlin J said (at 118):

“Historically, the word “proceedings” has meant the “invocation of the jurisdiction of a court by a process other than writ”: Herbert Berry Associates Ltd v IRC [1977] 1 WLR 1437 at 1446 per Lord Simon of Glaisdale; or “any application by a suitor to a court in its civil jurisdiction for its intervention or action”: Cheney v Spooner (1929) 41 CLR 532 at 538-9 per Starke J.”

O’Loughlin J considered that the application in Re Healey in which irregularities were involved had clearly invoked the jurisdiction of the court and should be treated as a “proceeding”.  This was followed in Re Federated Furnishing Trade Society of Australasia (1993) 113 ALR 137 at 149 so that an application involving failures to comply with mandatory provisions of regulations as to form and with such matters as failure to supply information required and lack of verification, were matters capable of being rectified by application of s 51 in its application to irregularities.

13                  In my opinion the same approach is applicable here.  The application is in irregular form because it does not comply with the requirements of s 33H and Form 129.  It is, however, clearly an attempt to invoke the Court’s jurisdiction.  There is no evidence that substantial injustice has been caused by the irregularity.  I consider that s 51(1) of the Federal Court Act applies and that it is appropriate to make an order (for the purpose of removing any doubt) that the proceeding is not invalid by reason of the irregularity.

14                  As a consequence of having reached this view, it is not necessary for me to consider the issue which might otherwise have arisen as to whether a fee which was paid in relation to the original application would have been refundable to the applicant or whether there is power to transfer it to a new application complying with the requirements of s 33H. 

Conclusion

15                  For these reasons I consider the applicant should be granted leave to amend the original application by substituting the further application and that the motion of the first to third respondents should be refused.

Associate:

Dated:              27 June 2001