FEDERAL COURT OF AUSTRALIA

The Food Improvers Pty Limited v BGR Corporation Pty Ltd (No 5)

[2007] FCA 466

PRACTICE AND PROCEDURE – Federal Court of Australia – judgments and orders – amendment of – correction under slip rule – where original order was the result of an accidental slip or omission – where original order does not reflect the intention of the Court

Federal Court Rules 1979 (Cth) O 35 rr 7(2)(e), 7(3)

Storey & Keers Pty Ltd v Johnstone (1987) 9 NSWLR 446 followed

THE FOOD IMPROVERS PTY LTD (ACN 003 474 280) AND ANOR v BGR CORPORATION PTY LTD (ACN 059 820 807) AND ORS

NSD 1140 OF 2005

RARES J

29 march 2007

SYDNEY

THE COURT ORDERS THAT:

1.                  Pursuant to the slip rule and O 35 r 7(3), order 1 made on 28 February 2007 be varied by deleting ‘The second and third defendants pay to the first defendant 90%’ and

(a)        substituting ‘Ninety percent’;

(b)        adding after the words ‘these proceedings’ the following: ‘be paid by the second and third defendants to each respective one of the first, fourth, fifth, sixth, seventh or eighth defendant which made each such payment’.

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

REASONS FOR JUDGMENT

1                     When preparing order 1 and my reasons for judgment given on 28 February 2007 (The Food Improvers Pty Ltd v BGR Corporation Pty Ltd (No 4) [2007] FCA 220), I overlooked that the plaintiffs had argued, as is shown in their written submissions dated 13 February 2007, that costs paid not just by BGR but the BGR group should be repaid by Triad and Cordato Services Partners.  Because of my oversight I framed order 1 in terms which limited the repayment to be made to BGR of what it was out of pocket.

2                     Earlier I had found that by causing BGR to pay their legal costs associated with the proceedings, Triad and Cordato Partners Services had acted oppressively to Food Improvers (see order 3(a) made on 12 February 2007:  The Food Improvers Pty Ltd v BGR Corporation Pty Ltd (No 3) [2007] FCA 97).

3                     If any of the fourth to eighth defendants had paid costs of the defence of the proceedings that would have been equally oppressive to Food Improvers.

4                     On 5 March 2007 the parties stated that they were in agreement that order 1 made on 28 February 2007 should be amended to read:

‘1.        The second and third defendants pay to the first defendant 90% of all amounts paid by the first defendant and/or the fourth to eighth defendants for or in respect of the legal costs and disbursements of any of the defendants in these proceedings.’

5                     The parties said that this amendment was by consent provided that I considered it should be made under the slip rule (and see O 35 r 7(3)).  The Court has an implied or inherent power to correct any clerical mistake or error in a judgment or order if it were the result of an accidental slip or omission:  Storey & Keers Pty Ltd v Johnstone (1987) 9 NSWLR 446 at 449E per McHugh JA.  He said that the power extended to permit a proposed variation of an order which related to a matter that was in issue in the proceedings or something which was incidental to such a matter if the need for such a variation is the result of an accidental omission or mistake (Storey & Keers 9 NSWLR at 452F-G; see too Australian Fisheries Management Authority v PW Adams Pty Ltd (No 2) (1996) 66 FCR 349).

6                     In addition to the power under the slip rule and O 35 r 7(3), under O 35 r 7(2)(e) the Court has power to vary or set aside an order after entry where it does not reflect the intention of the Court.

7                     I intended that my orders restore BGR and its group to the position they should have been in had the oppressive conduct of Triad and Cordato Partners Services in causing the payment of their costs not occurred.  I overlooked the plaintiffs’ submissions that I should frame the relief more generally than just affecting BGR.

8                     I am of opinion that had I been conscious that this was in issue, as I find it was, I would have framed the relief to ensure that whichever company within the BGR group had paid costs of the proceedings should be recouped 90% of those costs.

9                     My mistake was one which I am satisfied is within my powers under the slip rule and O 35 r 7(3) to correct and that the interests of justice require me to do so.

10                  The difficulty with the way in which the parties have proposed the correction is that there is a potential that BGR would be paid money that should be repaid to one of its subsidiaries.  Since all relevant members of the BGR group are in liquidation, the proper order to be made is one which restores to the payer 90% of what it paid.  That is the order which I would have made had I considered the matter properly on 28 February 2007.  Accordingly I will make an order varying order 1 so that it will read, when varied:

‘1.        Ninety percent of all amounts paid by each of the first, fourth, fifth, sixth, seventh and eighth defendants for or in respect of the legal costs and disbursements of any of the defendants in these proceedings be paid by the second and third defendants to each respective one of the first, fourth, fifth, sixth, seventh or eighth defendants which made each such payment.’

Associate:

Dated:         29 March 2007