FEDERAL COURT OF AUSTRALIA

Sydney Medical Service Co-operative Limited v Lakemba Medical Services Pty Ltd (No 2) [2016] FCA 1188

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to r 1.34 of the Federal Court Rules 2011 (Cth), compliance with r 41.06 is dispensed with to the extent that the initial service of the Orders did not bear the endorsement as required by r 41.06.

2.    The Respondent is to pay a fine in the sum of $30,000.

3.    In the event of any future non-compliance with the Orders made on 29 June 2016 and varied on 15 July 2016, as from 14 October 2016 the Respondent is also to pay an additional fine of $500 for each and every day upon which there has been non-compliance with any of those Orders.

4.    The fine payable by the Respondent pursuant to Order 2 is to be paid into the Consolidated Revenue Fund within 14 days.

5.    Any daily fine payable by the Respondent pursuant to Order 3 is to be paid into the Consolidated Revenue Fund within 14 days from the date of any continuing contravention.

6.    The Respondent is to pay the costs of the Applicant of the hearing on 28 September 2016 on an indemnity basis.

7.    Subject to Order 6, the Respondent is to pay the costs of the Applicant.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    In March 2016 the Applicant, Sydney Medical Service Co-operative Limited (“Sydney Medical Service”) filed an Originating Application in this Court. The Respondent was Lakemba Medical Services Pty Ltd (“Lakemba Medical Services”).

2    In very summary form, Sydney Medical Service alleged that Lakemba Medical Services had:

    engaged in misleading or deceptive conduct in contravention of s 18 of the Australian Consumer Law, which forms Sch 2 to the Competition and Consumer Act 2010 (Cth); and/or

    made a false or misleading representation that its services have an affiliation with those of the Applicant in contravention of s 29(1)(h) of the Australian Consumer Law; and/or

    made a false or misleading representation in contravention of s 29(1)(h), being a representation that the Respondent is accredited by Australian General Practice Accreditation Limited (“AGPAL”); and

    engaged in conduct which seeks to pass off its practice as that of the Applicant.

3    Reasons for decision were published on 29 June 2016: Sydney Medical Service Co-operative Limited v Lakemba Medical Services Pty Ltd [2016] FCA 763. The case advanced on behalf of Sydney Medical Service, it was concluded, had been substantially made out. Orders were then made restraining Lakemba Medical Services from engaging in specified conduct. There has been no appeal filed in respect to the decision then made and the orders as then made or as subsequently varied.

4    Sydney Medical Service now alleges that there has been non-compliance with those orders. By way of an Interlocutory Application filed on 18 August 2016 declaratory relief was sought that Lakemba Medical Services is guilty of contempt, and further sought both the imposition of a fine and costs. That application came before the Court on 8 September 2016. Given what were perceived to be potential difficulties then confronting the application as made, Counsel for Sydney Medical Service sought an adjournment. Lakemba Medical Services was represented by Counsel, who also requested an adjournment. The proceeding was stood over to 28 September 2016 for hearing. By that stage, an Amended Statement of Charge was filed together with an Amended Interlocutory Application. On that date the Respondent was represented by a solicitor who accepted that both of those documents had been served.

5    In summary form, it is concluded that the facts set forth in the original Statement of Charge and the Amended Statement of Charge have been made out and that a fine should be imposed in the sum of $30,000. In addition, it is further concluded that a daily fine of $500 should be imposed as from 14 October 2016 in the event that there is future non-compliance with any of the orders as previously made and as varied.

The Court’s powers in respect to contempt

6    The Court’s power in respect to contempt is set forth as follows in s 31 of the Federal Court of Australia Act 1976 (Cth):

Contempt of Court

(1)    Subject to any other Act, the Court has the same power to punish contempts of its power and authority as is possessed by the High Court in respect of contempts of the High Court.

(2)    The jurisdiction of the Court to punish a contempt of the Court committed in the face or hearing of the Court may be exercised by the Court as constituted at the time of the contempt.

7    The manner of exercise of that power is further addressed in Part 42 of the Federal Court Rules 2011 (Cth) (the “Federal Court Rules”).

8    Within Pt 41, which deals with “Enforcement”, r 41.06 provides as follows:

Endorsement on order

If an order requires a person to do, or not to do, an act or thing, whether within a certain time or not, and the consequences of failing to comply with the order may be committal, sequestration or punishment for contempt, the order must carry an endorsement that the person to be served with the order will be liable to imprisonment, sequestration of property or punishment for contempt if:

(a)    for an order that requires the person to do an act or thing—the person neglects or refuses to do the act or thing within the time specified in the order; or

(b)    for an order that requires the person not to do an act or thing—the person disobeys the order.

In Titan Support Systems Inc v Nguyen (No 2) [2015] FCA 359, an application for a finding of contempt arising out of the failure to comply with orders previously made failed. The orders as served did not contain the endorsement required by r 41.06. In respect to the need for compliance, Murphy J concluded:

[27]    … in my view r 41.06 indicates that enforcement by way of committal, sequestration and punishment for contempt is not available unless the order is endorsed as required and served or otherwise notified as provided by the Rules.

[28]    Rule 41.06 necessitates an endorsement on orders that require the person bound to do, or not to do, an act or thing, and r 41.07(1) requires that the order (in my view carrying the required endorsement) be personally served on the person bound by it (unless the person has had other notice of the order as provided under r 41.07(2)). I consider that unless the required endorsement is included in the order served (or otherwise notified in accordance with Division 41.1) the order may not be enforced by way of committal, sequestration or punishment for contempt.

The order made by his Honour was to vary the prior orders to include an endorsement, and to stand over the interlocutory application for punishment of contempt for further hearing on a future date.

9    Within Pt 42 of the Federal Court Rules, Div 42.2 provides in relevant part as follows:

Division 42.2 – Applications for contempt

42.11    Procedure generally

(1)    If a party alleges that a contempt has been committed by a person in connection with a proceeding in the Court, an application for punishment for the alleged contempt must be made by the party by interlocutory application in the proceeding.

...

42.12     Statement of charge

An application alleging that a contempt has been committed must be accompanied by:

(a)    a statement of charge, in accordance with Form 137, specifying the contempt with sufficient particularity to allow the person charged to answer the charge; and

(b)    the affidavits on which the person making the charge intends to rely to prove the charge.

The former O 40, r 6 of the now-repealed Federal Court Rules 1979 (Cth) required a “statement specifying the contempt”. The former rule and the current r 42.12 is a recognition of the principle of law that “no person should be punished for contempt of Court, which is a criminal offence, unless the specific offence charged against him be distinctly stated”: Australian Building Construction Employees' and Builders Labourers' Federation v Viner (1982) 63 FLR 253 at 275. Rule 1.34 of the current Federal Court Rules also provides that the Court “may dispense with compliance with any of these Rules, either before or after the occasion for compliance arises”.

10    The current r 42 also relevantly provides:

42.13    Service

The person charged must be served personally with:

(a)    the application (whether originating or interlocutory); and

(b)    the statement of charge; and

(c)    the affidavits on which the party making the charge intends to rely.

…

42.15    Procedure on the hearing

(1)    The person charged may apply to the Court for an order:

(a)    that the hearing of the charge proceed by way of oral evidence; or

(b)    for the cross-examination of the deponents to the affidavits to be relied on by the person making the charge.

(2)    The person charged may file affidavits in answer to the charge.

(3)    The person charged may:

(a)    give oral evidence; and

(b)    call witnesses to give oral evidence without first filing any affidavit sworn by the person charged or by those witnesses.

11    The present case requires no detailed exposition of the principles to be applied when a contempt is alleged, the range of penalties open to the Court or the principles to be applied. But some brief exposition is nevertheless prudent.

12    First, in Pelechowski v Registrar, Court of Appeal (NSW) [1999] HCA 19, (1999) 198 CLR 435 at 463 McHugh J observed:

[88] … In considering the appropriateness or otherwise of a sentence imposed for a contempt of court, it must always be borne in mind that the jurisdiction to commit for contempt exists so that the authority of the courts of law can be maintained. If breaches of the orders of the courts were regarded as of little moment, respect for and observance of the law would inevitably deteriorate and, ultimately, pose a threat to social order.

13    Second, the necessary elements to make good a charge of civil contempt have been identified as follows by Gillard J in Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201:

[31]    In order to prove a civil contempt of court involving a breach of an order of the court, the plaintiff has to prove the following:

(i)    that an order was made by the court;

(ii)    that the terms of the order are clear, unambiguous and capable of compliance;

(iii)    that the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules of Court;

(iv)    that the alleged contemnor has knowledge of the terms of the order;

(v)    that the alleged contemnor has breached the terms of the order.

[32]    It is necessary for the plaintiff to prove each element beyond reasonable doubt. In accordance with the principles of the criminal law, in proving element (v) it must be proven that the act or omission which constituted the breach of the order was deliberate and voluntary.

Although reference is there made to the need for an order to be expressed in terms which are “clear, unambiguous and capable of compliance”, it has nevertheless also been concluded that an order may be “clear and unambiguous” even though questions may arise as to the construction of the terms of an order: Australian Competition and Consumer Commission v ACN 117 372 915 Pty Ltd (in liq) (formerly Advanced Medical Institute Pty Limited) [2015] FCA 1441 at [52] per Moshinsky J. A “direct intention to disobey an order is not a necessary element in a finding of wilful disobedience or a deliberate commission or omission in relation to an order”: Hurd v Zomojo Pty Ltd [2015] FCAFC 148 at [91] per Besanko and Gilmour JJ.

14    Third, the Court has a wide range of penalties open to it: Australian Competition and Consumer Commission v INFO4PC.Com Pty Ltd [2002] FCA 949, (2002) 121 FCR 24 at 54. R D Nicholson J there observed:

[138]    The Federal Court has a wide range of penalties open to it … and includes the power to:

(a)     commit a contemnor to prison for an indefinite period of time ...

(b)     to impose a fine for a wilful breach of an order or undertaking ...

(c)     to impose a daily fine ...

(d)     to order the sequestration of the assets of a contemnor …

(e)     to suspend on condition any sentence of imprisonment that it might impose in respect to contempt ...

Cited with approval: Hughes v Australian Competition & Consumer Commission [2004] FCAFC 319 at [55] per French, Emmett and Dowsett JJ; Titan Support Systems Inc v Nguyen (No 2) [2015] FCA 359 at [12] per Murphy J. Besanko J, it may be noted by way of example, has imposed a fine and also a daily fine for any continuing contempt in Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2014] FCA 637 at [85].

15    Fourth, in Australian Competition and Consumer Commission v World Netsafe Pty Ltd [2003] FCA 1501, (2003) 133 FCR 279 at 283 Spender J observed:

[16]    Considerations which are relevant in deciding what is the appropriate penalty include:

(a)    The relative seriousness of the contempt, which is determined by the extent to which the contemnor appreciated that a contempt was being committed ...

(b)    Whether the contemnor subjectively intended to disobey the order ...

(c)    The importance of bringing home to the contemnor the seriousness of the contempt ...

(d)    Whether the contemnor has offered any explanation or apology for his conduct ...

(e)    An acknowledgment by the contemnor that a contempt was committed may be a mitigating factor ...

This list of considerations is, obviously enough, not exhaustive. Palmer J in Australian Securities & Investments Commission v Michalik [2004] NSWSC 1259, (2004) 52 ACSR 115 at 123 has expressed the considerations of relevance, albeit again in a non-exhaustive fashion, as follows:

[29]    For present purposes the relevant factors to be considered may be summarised thus:

(i)    the seriousness of the contempt proved;

(ii)    whether the contemnor was aware of the consequences to himself of what he proposed to do;

(iii)    the actual or potential consequences of the contempt on the proceedings in which the contempt was committed;

(iv)    whether the contempt was committed in the context of a proceeding alleging crime or conduct seriously prejudicial to the public interest …

(v)    the reason or motive for the contempt;

(vi)    whether the contemnor has received, or sought to receive, a benefit or gain from the contempt;

(vii)    whether there has been any expression of genuine contrition by the contemnor;

(viii)    the character and antecedents of the contemnor;

(ix)    what punishment is required to deter the contemnor and others of like mind from similar disobedience to the orders of the court;

(x)    what punishment is required to express the court’s denunciation of the contempt.

Apprv’d: Australian Competition and Consumer Commission v Levi (No 3) [2008] FCA 1586 [19] per McKerracher J. A further centrally relevant consideration is the effect of the contempt on the administration of justice. See: Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83 at [83] per Merkel J; Metcash Trading Limited v Bunn (No 6) [2009] FCA 266 at [7] to [8] per Finn J; Alfred v Construction, Forestry, Mining and Energy Union (No 2) [2011] FCA 557 at [14] per Tracey J.

The orders as made and as varied

16    The orders made on 29 June 2016 were as follows:

1.    The Respondent is restrained from distributing any pamphlets bearing the words “Sydney Medical Services 2020”.

2.    As from no later than 4pm on 6 July 2016 the Respondent is restrained from trading using the words “Sydney Medical Services 2020” or the words “Sydney Medical Services”.

3.    Further to Order 2, as from no later than 4pm on 6 July 2016 the Respondent is to:

a.    remove the words “Sydney Medical Services 2020” from the exterior of the motor vehicle with the registration number BX 17 TX;

b.     remove the words “Sydney Medical Services” and “Sydney Medical Services 2020” from the website http://www.lakembamedicalservices.com.au/after-hours/;

c.    cease using the domain name http://www.sydneymedicalservices2020.com.au, and remove the words “Sydney Medical Services” and “Sydney Medical Services 2020” from that website;

d.    remove or cause the words “Sydney Medical Services” and “Sydney Medical Services 2020” to be removed from the website http://healthengine.com.au; and

e.    cease using the words “Sydney Medical Services” and “Sydney Medical Services 2020” in any email account.

4.    The parties have liberty to apply by no later than 8 July 2016 to vary the terms of the orders made.

5.    The Respondent is to pay the costs of the Applicant.

Liberty was reserved to the parties to vary the terms of the orders primarily because the orders as made (and as sought by Sydney Medical Service) did not seem to correspond to the evidence – particularly in relation to the websites.

17    Those orders were indeed varied on 15 July 2016 to accommodate those discrepancies and were as follows:

BY CONSENT, THE ORDERS OF 29 JUNE 2016 ARE VARIED SUCH THAT:

1.    The Respondent is restrained from distributing any pamphlets bearing the words “Sydney Medical Services 2020”.

2.    As from no later than 4pm on 6 July 2016 the Respondent is restrained from trading using the words “Sydney Medical Services 2020” or the words “Sydney Medical Services”.

3.    Further to Order 2, as from no later than 4pm on 6 July 2016 the Respondent is to:

a.    remove the words “Sydney Medical Services 2020” from the exterior of the motor vehicle with the registration number BX 17 TX;

b.     remove the words “Sydney Medical Services” and “Sydney Medical Services 2020” from the website http://www.lakembamedicalservices.com.au/after-hours/;

c.    cease using the domain name http://www.sydneymedicalservices 2020.com.au, and remove the words “Sydney Medical Services” and “Sydney Medical Services 2020” from that website;

d.    remove or cause the words “Sydney Medical Services” and “Sydney Medical Services 2020” to be removed from the website http://healthengine.com.au; and

e.    cease using the words “Sydney Medical Services” and “Sydney Medical Services 2020” in any email account.

4.    The parties have liberty to apply by no later than 8 July 2016 to vary the terms of the orders made.

5.    The Respondent is to pay the costs of the Applicant.

18    The orders as made on 29 June 2016 were also varied on 15 July 2016 to accommodate what was then presented to the Court as the need for further time to comply. The orders extending the time for compliance, and as made on 15 July 2016 were as follows:

1.    On the application of the Respondent, the time for compliance with the Orders of 29 June 2016 and as varied on 15 July 2016 be extended to 5pm on 16 July 2016.

2.    The Respondent is to file and serve, by no later than 4pm on 18 July 2016, an affidavit setting forth all steps taken to ensure compliance with the Orders of 29 June 2016 and today, including:

a.    such steps as were taken to ensure that any instructions given to implement the Orders made on 29 June 2016 were in fact taken;

b.    all steps taken between 29 June 2016 and 14 July 2016 to ensure compliance with the orders made; and

c.    all steps taken on or after 10am 15 July 2016 to ensure compliance with the Orders as varied on 15 July 2016.

3.    The proceeding is stood over for mention or hearing at 10am on 19 July 2016.

4.    Costs reserved.

No affidavit was filed in accordance with Order 2.

The Amended Statement of Charge as filed by Sydney Medical Service

19    The Amended Statement of Charge as filed on behalf of Sydney Medical Service on 22 September 2016 sets forth six Charges. The amendments were largely directed to amending the period of time during which the contempt was said to have occurred. One of the amendments was to allege that in respect to Charges 2, 4 and 5 the non-compliance with the orders as varied was “ongoing”.

20    Omitting the Particulars provided in respect to each Charge, the Charges as amended were expressed as follows:

Charge 1 – Sign at the Premises

1.    Between 8After 5 pm on 16 July 2016 and up until on or about 7 September 2016 16 August 2016, you, whether by your servants, agents or otherwise, have displayed a sign outside your place of business at 27-31 Railway Parade, Lakemba, in the State of New South Wales, 2195 (the Premises) bearing the words ‘Sydney Medical Services’, in breach of order 2 made by Flick J on 29 June 2016 and as varied on 15 July 2016 in proceeding NSD 349 of 2016 (Order 2).

Charge 2 – Facebook page

2.    Between After 5pm on 16 July 2016 and still ongoingon or about 10 August 2016, you, whether by your servants, agents or otherwise, maintained or caused to be maintained a Facebook page using the words ‘Sydney Medical Services 2020’, in breach of Order 2.

Charge 3 – First Motor vehicle

3.    On 27 July 2016, you, whether by your servants, agents or otherwise, maintained a motor vehicle registration number CZR 86K with the words “Sydney Medical Services 2020” on the exterior of that vehicle, in breach of Order 2.

Charge 4 – Lakemba Medical Services website

4.    Between 7 July 2016 and 10 August 2016 After 5pm on 16 July 2016 and still ongoing, you, whether by your servants, agents or otherwise, operated the website with the domain name http://www.lakembamedicalservices.com.au, which included use of the words “Sydney Medical Services” and “Sydney Medical Services 2020”, in breach of order 3(b) made by Flick J on 29 June 2016 and as varied on 15 July 2016 in proceeding NSD 349 of 2016 (Order 3(b)).

Charge 5 – Sydney Medical Services 2020 Website

5.    Between 7 July 2016 and 10 August 2016 After 5pm on 16 July 2016 and still ongoing, you, whether by your servants, agents or otherwise, operated the website with the domain name http://www.sydneymedical services2020.com.au, in breach of order 3(c) made by Flick J on 29 June 2016 and as varied on 15 July 2016 in proceeding NSD 349 of 2016 (Order 3(c)).

Charge 6 – Health Engine Website

6.    Between 18 July 2016 and 26 July 2016, you, whether by your servants, agents or otherwise, displayed or caused the words “Sydney Medical Services’ and “Sydney Medical Services 2020” to be displayed on the website http://healthengine.com.au in breach of order 3(d) made by Flick J on 29 June 2016 and as varied on 15 July 2016 in proceeding NSD 349 of 2016 (Order 3(d)).

The Amended Statement of Charge conforms to Form 137, as required by r 42.12(a) of the current Federal Court Rules.

21    Although the Particulars have not been set forth, it should nevertheless be noted that the terms with which each Charge is expressed and the Particulars provided in respect to each Charge comply with the requirement imposed by r 42.12(a) of the current Federal Court Rules to specify “the contempt with sufficient particularity to allow the person charged to answer the charge”.

The facts

22    The evidence relied upon by Sydney Medical Service when the contempt proceeding was first before the Court on 8 September 2016 comprised affidavits either sworn or affirmed by:

    Ms Breanna Knight, a legal clerk employed by the solicitors for Sydney Medical Service;

    Ms Julia Sorbara, a solicitor employed by the solicitors for Sydney Medical Service; and

    Mr Adel Badawy, the Chief Executive Officer of Sydney Medical Service.

Of relevance to the hearing which was adjourned on 8 September 2016 was the fact that the initiating documents as served upon the Respondent did not include a copy of the orders as made bearing the endorsement as required by r 41.06 of the Federal Court Rules.

23    During the course of the adjourned contempt hearing, further affidavits were filed, being affidavits either sworn or affirmed by:

    Ms Breanna Knight, sworn on 25 August and 5 September 2016;

    Ms Julia Sorbara sworn on 22 September 2016; and

    Mr Adel Badawy affirmed on 22 September 2016.

24    The solicitor previously appearing for Lakemba Medical Services (Mr Bengura of KelvinLaw) filed a Notice of Ceasing to Act on 18 August 2016. There was no evidence filed on behalf of Lakemba Medical Services for the purposes of the hearing on 8 September 2016.

25    By the time of the hearing on 28 September 2016 the Respondent had secured new legal representation and three affidavits were filed on 28 September 2016, those affidavits being affidavits each affirmed on 22 September 2016 by:

    Dr Elsadig Mohammed, a director of the Respondent;

    Mr Bassam Eldabousi, a “Sign Writer”; and

    Mr Ahmed Garad, an “IT Specialist”.

Service of those affidavits was well beyond the time previously directed for the filing and service of evidence. All deponents were required for cross-examination – but only Dr Mohammed attended. A submission understood to have been advanced by the solicitor for the Respondent that Messrs Eldabousi and Garad should be excused from attendance by reason of the lateness of the notice requiring them to attend was without merit. Given the lateness of the service of the three affidavits, the lateness of the notice requiring their attendance for cross-examination was hardly unexpected. Rather than not permitting the affidavits of Messrs Eldabousi and Garad to be read, the Respondent was permitted to rely upon those additional affidavits. Given the disputed factual content of those two affidavits and the absence of detail as to the facts deposed to, however, limited weight can be given to them. Even in the absence of cross-examination, the absence of detail provided in those two affidavits rendered both affidavits singularly unhelpful.

26    It was not put in issue at the hearing on 28 September 2016 that Lakemba Medical Services has been served personally with:

    the Interlocutory Application and the Amended Interlocutory Application dated 22 September 2016;

    the Statement of Charge and the Amended Statement of Charge; and

    the affidavits upon which Sydney Medical Service seeks to rely.

Compliance with r 42.13 was thus not in question. And the Orders as were subsequently served on or about 13 September 2016 did in fact bear the endorsement required by r 41.06 of the Federal Court Rules.

27    Without being exhaustive, the evidence filed on behalf of Sydney Medical Service establishes that:

    on 8, 10 and 23 July 2016 photographs of the exterior of the premises of Lakemba Medical Services retained a reference to “Sydney Medical Services 2020” but that on on 18 July 2016 newspaper had been taped over the words “Sydney Medical Services 2020” and on 27 July 2016 those words had been covered over altogether. On both occasions, however, the web address www.sydneymedicalservices.com.au remained uncovered;

    on 25 and 26 August 2016 (and until 8 September 2016) photographs of the exterior of the premises of Lakemba Medical Services retained a reference to the website www.sydneymedicalservices.com.au;

    on 27 July 2016 photographs of a vehicle located at the premises of Lakemba Medical Services (registration number CZR 86K) displayed on the rear windscreen and the driver’s door the words “Sydney Medical Services” (and possibly “2020”); and

    on 1 September 2016 a motor vehicle was seen exiting from the premises of Lakemba Medical Services retained the sign on its side and a reference to “Sydney Medical Services 2020”, but the registration number of that vehicle is unknown.

The evidence also establishes that:

    on 22 August 2016, within the premises of Lakemba Medical Services, there remained a sign on the wall directly behind the front desk at reception which contained the words “Sydney Medical Services 2020”. That sign was, in all probability, the same sign as was present in March 2016.

28    What is disturbing about these findings is that Lakemba Medical Services:

    took no steps within any reasonable period of time and certainly not within the time as specified in the Orders as made and varied to remove references to “Sydney Medical Services” or “Sydney Medical Services 2020”;

    took some belated steps to comply by at least 18 July 2016 and (at the very least) was indifferent to the effectiveness of covering with newspaper the words the subject of the Orders as made and varied;

    did not change the sign on the exterior of its premises until about 8 September 2016;

    complied with Order 3(a) by covering over the words “Sydney Medical Services 2020” on a motor vehicle with the registration number BX 17 TX but did not delete those words from a second motor vehicle registration number CZR 86K; and

    failed by 22 August 2016 to take steps to remove a sign which was more readily accessible than the sign on the exterior of its premises, namely the sign behind the reception area.

29    With respect to the information disclosed on the websites, the evidence filed on behalf of Sydney Medical Service establishes that:

    the image which appeared on the website for Lakemba Medical Services was removed by 27 July 2016 but the words “Sydney Medical Services” and “Sydney Medical Services 2020” still appeared on the website; and

    as at 18 July 2016, the website http://healthengine.com.au still contained a reference to “Sydney Medical Services”.

Moreover, as at 22 September 2016 Lakemba Medical Services was continuing to use the words “Sydney Medical Services” or “Sydney Medical Services 2020” by:

    using those words in its website http://www.lakembamedicalservices.com.au; and

    its Facebook page using those words, together with contact information about its services.

30    Ms Sorbara’s affidavit of 12 August 2016 further deposes to the following conversation that took place on 27 July 2016 between herself and Mr Bangura who was employed by the then solicitors for Lakemba Medical Services:

Bangura:    ‘I am at Lakemba. All of the website references have been taken down.’

Sorbara:    “I am on the website of Lakemba Medical Services as we speak and although you are telling me that all references to Sydney Medical Service 2020 have been removed, I am looking at references still there on the website.’

Bangura:    ‘I spoke personally to the IT guy’

Sorbara:    ‘This might be the case but I am looking at the website and what you are saying is not correct.’

Bangura:    ‘When did you last look at the website?’

Sorbara:    ‘I am on the website right now. It is on my screen. You can understand my client’s frustration when it keeps being told that the website references have been removed but each time I do a search, the references are still there. His Honour was very clear this morning about the seriousness of the Respondent not complying with the Court’s orders.’

Bangura:    ‘It is not the doctors’ fault, they are not IT specialists.’

Sorbara:    ‘The orders require the Respondent to comply. They are responsible for checking whether the orders have been complied with but it is apparent they have not done this because they have not looked at their own website which clearly contains the references which they keep insisting have been removed.’

Bangura:    ‘This is not the doctors’ fault because they have instructed the IT guy to remove the references and he personally spoke to the IT guy today.’

Sorbara:        ‘Have you actually looked at the Respondent’s website?’

Bangura:    ‘I have not but the doctors have tried to comply.’

Sorbara:    ‘I am also aware that there is a motor vehicle parked outside the premises today with the words Sydney Medical Services 2020 on it. I have a photograph of that vehicle. Did you see the vehicle at the premises? While you might be receiving instructions that the orders have been complied with, appropriate steps have not been taken to comply.'

Whatever else this evidence may establish, there can be no doubt that as at 27 July 2016:

    the Respondent was on notice as to asserted non-compliance with the Orders; and that

    reliance was, even at that early stage, being placed upon an asserted lack of “fault” on the part of the doctors by reason of their having spoken to “the IT guy”.

31    On no occasion did the Respondent seek to have the matter re-listed before the Court to vary the Orders made, with a view (for example) to seek more time in which to comply.

32    Ms Sorbara’s further affidavit sworn on 22 September 2016 stated that there had been no change to the Respondent’s websites since 9 September 2016. After the close of final submissions on 28 September 2016, however, a further affidavit of Ms Sorbara was forwarded to the Court which stated that the Respondent’s website www.sydneymedicalservices2020.com.au had “changed” since her previous affidavit of 22 September 2016. The more recent affidavit states that as from 28 September 2016, the website contains only the words “Under construction. Will be back soon”. A covering e-mail submitted that “the website only displayed its full content from 16 July 2016 to 17 July 2016, and from 9 September 2016 to 27 September 2016”. An oral submission during the course of the hearing that the conduct in respect to Charge 5 was “ongoing” was, accordingly, revised.

33    What is also disturbing in respect to the present Amended Interlocutory Application is that:

    there has been non-compliance with Order 2 as made on 15 July 2016 requiring an affidavit to be filed by no later than 18 July 2016 setting forth “all steps taken to ensure compliance with the Orders of 29 June 2016”; and

    such evidence as was filed belatedly by the Respondent fails to address in any satisfactory detail the steps taken to attempt compliance with the Orders as made and as varied.

In the absence of any affidavit being filed by 18 July 2016, an inference is readily available that Lakemba Medical Services took no immediate steps to ensure compliance with the Orders made on 29 June 2016 – at least prior to 18 July 2016 when newspaper partly concealed the reference to “Sydney Medical Services 2020”.

34    The contrary evidence of Dr Mohammed has been considered, as has his further oral evidence and cross-examination. It is regrettably concluded that little weight can be placed upon that evidence. It is further concluded that in cross-examination he was deliberately evasive in the answers given and displayed little willingness to answer the questions put to him. More importantly, he displayed a disturbing unwillingness to accept responsibility for either past or continuing contraventions of the Orders as initially made and as varied. He sought to divert responsibility to his fellow director, Dr Sayid, who was said to be unavailable to give evidence. He also sought (for example) to divert responsibility to the “IT guy” for ensuring compliance with those aspects of the Orders requiring deletion of material from the internet facilities and websites. Attempts to secure a sign-writer to paint over the signage on the exterior of the building were (on the view most favourable to the Respondent) equally directed to removing the signage at “mates’ rates” rather than ensuring timely compliance with the Court’s Orders.

35    Particular reference should also be made to the circumstances in which Dr Mohammed came to express an apology to the Court on behalf of the Respondent. There was no apology in his affidavit affirmed on 22 September 2016. Before any evidence was called at the hearing on 28 September 2016, specific reference was made to the absence of any apology. Dr Mohammed was then called by his solicitor – but even then he proffered no apology during examination in chief. His apology came only when, in final submissions being made on behalf of the Respondent, the Court again referred to the absence of any apology or any expression of contrition or remorse. Leave was then granted for Dr Mohammed to be recalled, and the following exchange occurred with his solicitor:

Dr Mohammed, do you understand the severity of what’s before the court today? — Yes.

Do you think you willingly disregarded the court? — I don’t want to disregard the court at all. I was trying my best. I thought I was complying with the court.

Do you have anything else to say to the court about the omissions your company and yourself have? — Yes, I apologise what all has happened. And we have not intentionally done. And I’m willing to take serious step to remove all the noncompliant points. And apologise for the other company. And the court.

Did you deliberately falsify things in your evidence? — Not at all. I’m not – I don’t – I don’t – definitely I’m not – I – whatever I’ve done I thought is truthfully. I wasn’t trying to do false things or to change the truth. I was trying to do my best to do the right things. I’m not aware about any – of lying or so I wasn’t – this is not my character at all to lie at all. But maybe like so how is understanding things and what point from this point to another point. But not at all. I’m not intentionally to – to say untrue things.

Irrespective of the absence of the Respondent proffering an apology from the outset without prompting, it is concluded that little weight can be given to the apology ultimately expressed. Reservation is expressed as to the genuineness of the apology, especially given the reservations otherwise expressed with respect to the evidence of Dr Mohammed. Moreover, little weight can be given to an apology from someone who repeatedly sought to deflect responsibility to another.

CONCLUSIONS

36    It is concluded that Lakemba Medical Services has not complied with the Orders made on 29 June 2016 and as varied on 15 July 2016 and has thus committed a contempt of this Court.

37    The contempt the subject of Charge 3, it should be noted, is not a Charge that the Respondent has failed to comply with Order 3(a) as made on 29 June 2016 and as subsequently varied. Order 3(a) was confined to motor vehicle registration number BX 17 TX. And such evidence as was available, namely in Dr Sayid’s affidavit filed in the principal proceeding, revealed the deletion of the words “Sydney Medical Services 2020” from the exterior of that motor vehicle. The contempt the subject of Charge 3 related to the other motor vehicle registration number CZR 86K. But the Order which was said to have been breached was not Order 3(a) – but Order 2. No submission was advanced on behalf of the Respondent that that alleged contempt did not fall within Order 2. Nor was any submission advanced that the evidence relied upon by the Applicant as to a motor vehicle continuing to display the words “Sydney Medical Services 2020” did not relate to motor vehicle CZR 86K.

38    Charge 3, it is thus concluded, has been made out.

39    It is further concluded that each of the other Charges have also been made out.

40    Moreover, the contempt the subjects of Charges 2 and 4 is on-going.

41    Given the manner in which the Charges have been expressed and the detail provided in the Particulars to each Charge, and the findings that have been made, it is not considered necessary to grant declaratory relief.

42    It is also concluded that:

    every opportunity has been extended to Lakemba Medical Services to comply with the Orders as made on 29 June 2016 and as varied, including the extension of time made by consent on 15 July 2016; and

    the time necessary to give effect to the Orders has been adequate, including the time necessary to secure the deletion of all necessary references on the internet facilities and websites

and that the failure to comply has been:

    in deliberate and intentional disregard of the need to comply with those Orders.

Moreover, and even assuming that more time may have been required to effect deletions to the internet facilities and websites than compliance with other steps ordered to be taken, the failure on the part of Lakemba Medical Services to effect the deletion of references to “Sydney Medical Services” and “Sydney Medical Services 2020” from the signage on the exterior of the premises of Lakemba Medical Services, the signage displayed on motor vehicle CZR 86K and from the signage behind the reception desk only reinforces a conclusion that the failure to comply:

    deservedly attracts a not insignificant fine.

In the absence of not only a fine, but also a daily fine, it is further concluded that Lakemba Medical Services will continue to flout the orders of this Court.

43    The repeated occasions upon which this proceeding has been before the Court, and the repeated occasions upon which Lakemba Medical Services has been informed of the serious consequences of non-compliance with Court orders, it is further concluded, provide a sufficient reason to dispense with compliance with the requirement imposed by r 41.06 in respect to the initial service of the Orders of 29 June 2016. It was accepted that a copy of the Orders bearing the endorsement required by that rule has subsequently been served together with the Amended Statement of Charge.

44    The need for compliance by Lakemba Medical Services with the Orders as made and as varied, it is respectfully considered, is necessary “so that the authority of the courts of law can be maintained” and breaches of orders made cannot be regarded as of “little moment”: cf. Pelechowski.

45    Although the steps taken to effect compliance with one or other of the Orders as made and as varied may well have been different and may well have been more easily capable of ensuring compliance, it is concluded that a fine of $5,000 for each of the Charges is considered appropriate. Viewed more globally and viewed in its entirety as non-compliance with the Orders as made and as varied, it is further concluded that a fine in the sum of $30,000 is manifestly appropriate. Even assuming the Court has power to make an order that a fine be paid to an applicant, the appropriate order in the present proceeding is that the sum of $30,000 should be paid into the Consolidated Revenue Fund within 14 days: cf. Brookfield Multiplex FSH Contractor Pty Ltd v McDonald [2013] FCA 1380 at [35] to [38] per Gilmour J.

46    This total amount, it is further concluded, gives effect to those considerations relevant to the assessment or quantification of the fine to be imposed as set forth in World Netsafe and other considerations discussed in the authorities. In particular, it is noted that Lakemba Medical Services ultimately offered an apology for its conduct, but the circumstances in which the apology was given provide little (if any) reason to reduce the quantum of the fine otherwise thought to be appropriate.

47    A daily fine of $500 is also considered appropriate in respect to any on-going non-compliance with the Court orders. There is little reason not to impose a daily fine in circumstances where the Respondent has already been given more than adequate time in which to comply with those Orders and where there is continuing failure to comply with aspects of those Orders, and little sense of urgency on the part of the Respondent to ensure compliance.

48    Liberty is reserved to the parties to apply on 48 hours’ notice. In the event that there remains on-going non-compliance, questions may arise as to the power of the Court to make further orders to ensure compliance and whether any such further order should be made as a matter of discretion.

49    There is no reason why Lakemba Medical Services should not pay the costs of Sydney Medical Service. Costs of the final hearing on 28 September 2016 should be paid on an indemnity basis; otherwise the Respondent should pay the costs of the Applicant. The adjournment of the hearing on 8 September 2016, it may be noted, was not attributable to any fault of the Respondent.

THE ORDERS OF THE COURT ARE:

1.    Pursuant to r 1.34 of the Federal Court Rules 2011 (Cth), compliance with r 41.06 is dispensed with to the extent that the initial service of the Orders did not bear the endorsement as required by r 41.06.

2.    The Respondent is to pay a fine in the sum of $30,000.

3.    In the event of any future non-compliance with the Orders made on 29 June 2016 and varied on 15 July 2016, as from 14 October 2016 the Respondent is also to pay an additional fine of $500 for each and every day upon which there has been non-compliance with any of those Orders.

4.    The fine payable by the Respondent pursuant to Order 2 is to be paid into the Consolidated Revenue Fund within 14 days.

5.    Any daily fine payable by the Respondent pursuant to Order 3 is to be paid into the Consolidated Revenue Fund within 14 days from the date of any continuing contravention.

6.    The Respondent is to pay the costs of the Applicant of the hearing on 28 September 2016 on an indemnity basis.

7.    Subject to Order 6, the Respondent is to pay the costs of the Applicant.

Associate:    

Dated:    6 October 2016