FEDERAL COURT OF AUSTRALIA

Robertson v Knott Investments Pty Ltd [2010] FCA 619

THE COURT ORDERS THAT:

1.                  The Notice of Motion as filed on 1 June 2010 is dismissed.

2.                  The Applicant on the Motion, Mr Robertson, is to pay the costs of the Respondent.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

1                                             On 8 March 2010 Raphael FM of the Federal Magistrates Court of Australia delivered judgment in Robertson v Knott Investments Pty Ltd [2010] FMCA 142. That Court dismissed an application seeking damages pursuant to s 82 of the Trade Practices Act 1974 (Cth) (“the Act”) and the alternative order sought pursuant to s 87 of the Act for breach of s 53B. The damages ultimately claimed is understood to be less than $100,000.

2                                             The Respondent is apparently a company that designs and manufacturers Winnebago Motor Homes. The claim sought to be advanced by Mr Robertson (“the Appellant”), and the grounds upon which those claims were resisted, were summarised by the Federal Magistrate at the outset of his reasons for decision as follows:

Introduction

[1] The applicant in this proceeding seeks relief by way of damages pursuant to s 82 or an order (unspecified) pursuant to s 87 for breach of s 53B of the Trade Practices Act 1974 (the “Act”) which prohibits a corporation from engaging in conduct that is liable to mislead persons seeking employment as to the availability, nature, terms or conditions of or any other matter relating to the employment. The misleading conduct which the applicant alleges was a representation as to the length of his employment which was a representation as to a future matter so that the provisions of s 51A of the Act were applicable. In order to resolve this matter evidence was received from the applicant, from the respondent’s recruitment agent, from two directors of the respondent and two other members of the respondent’s staff. The respondent put in issue the making of the representations, the applicant’s reliance upon them if they were made, their reasonableness if they were made and whether any loss or damage was suffered by the applicant that could be the subject of an order for damages under s 82. …

The Federal Magistrate thereafter set forth the elements of those matters to be established and, in addressing questions as to the reliance placed by the now Appellant upon the representations made and the basis upon which those representations were made, concluded in part as follows:

[23] … He now seeks to say that he signed the contract relying on the previous representations. How could he have done that when the terms of the representations were not translated into the contractual document and when he had received no further representations? … In my view Mr Robertson signed the contract because he had no reason to believe that he could not competently carry out the demands of the position and because he believed that this would add to the success of the Winnebago company who would have no reason not to continue to employ him. This is not the same as signing it on the basis of the representations that he claims he relied upon.

…

[25] The second point which is fatal to the applicant’s case is that Mr Binns appears to have had reasonable grounds for making the representations that Mr Robertson would remain with the company for three or more years. That a promise or prediction is not fulfilled is alone insufficient to establish that it was misleading or deceptive: … A prediction will only amount to misleading conduct in circumstances where the person making the statement knew it to be false or made the statement with reckless disregard as to whether the statement was true or false … [citations omitted]

The Federal Magistrate was clearly not satisfied, for the reasons he provided, that Mr Robertson had relied upon any representation; nor was he satisfied that there was an absence of reasonable grounds for the making of any representation.  

3                                             In addition to dismissing the application, the Federal Magistrate further ordered:

(2)           Applicant to pay Respondent’s costs to be assessed in accordance with Pt 21 r 21.02(2)(b) and Sch 1 of the FMC Rules.

Given the dismissal of the application, the order as to costs was hardly surprising.

4                                             A Notice of Appeal was filed in this Court on 29 March 2010.

5                                             Now before the Court is a Notice of Motion, filed on 1 June 2010, seeking an order staying the orders made by the Federal Magistrate “until further order of this Court”. The appeal, it is further understood, is listed for hearing on 23 August 2010.

6                                             That Motion was heard on 10 June 2010 when the Applicant on the Motion, the Appellant in the proceeding, properly only sought an order staying the costs order as made by the Federal Magistrate. In support of the Motion an affidavit of the solicitor for the Appellant, Mr Atkinson, was relied upon. The Respondent relied upon an affidavit of one of the solicitors for the Respondent, Ms Fetherston. Ms Fetherston calculated the quantum of costs of the Respondent relevant to the order made by the Federal Magistrate to be $53,605.72.

7                                             Given the amount of costs that have already been incurred, and the quantum of the amount claimed in the proceeding before the Federal Magistrate, it is stating the obvious to acknowledge that it does not reflect well on (potentially) either party that the proceeding has not been settled or compromised.

8                                             Be that as it may, the Appellant advanced two propositions in oral submissions, namely:

·                    the “additional costs in having the Respondent’s costs assessed will be substantial to each party” and if the Appellant “is successful on appeal then those costs associated with the assessment will in effect be thrown away”; and

·                    the hearing of the appeal is imminent and such prejudice as may be suffered by the Respondent in being denied the benefit of the costs order is thus minimal.

9                                             The Respondent disputed the proposition that any assessment of costs would be a difficult process and further opposed the stay on the bases that:

·                    the Appellant, although he has present residence in Australia, is not the registered owner of any property in Australia and his wife and son remain residents in the United States of America;

·                    the Appellant does not have any real prospects of success on appeal; and

·                    the Respondent carries on a substantial business in Australia and there islittle prospect that the Appellant would not be able to recover from the Respondent any monies payable to him should he be successful on appeal.

There was no evidence filed on behalf of the Appellant disputing the quantification of costs annexed to the affidavit of Ms Fetherston. The simplicity of the process of calculation adopted, and the quantum of the calculation, is thus presently accepted.

10                                          Notwithstanding the imminence of the hearing of the appeal, it is not considered that any stay should be granted. Although the Appellant may only have questionable prospects of success on appeal, that can remain a matter to be more fully explored on the hearing of the appeal. For present purposes, it is sufficient to conclude that there is little reason why the Respondent should presently be denied the benefit of the order as to costs which it presently has in its favour. There is no basis upon which any conclusion could be reached that the Respondent is not able to account to the Appellant for any monies paid prior to the resolution of the appeal should the Appellant ultimately prevail. The balance of convenience is against any stay now being granted.

ORDERS

11                                          The Orders of the Court are:

1.                  The Notice of Motion as filed on 1 June 2010 is dismissed.

2.                  The Applicant on the Motion, Mr Robertson, is to pay the costs of the Respondent.

Associate:

Dated:         17 June 2010