O'Brien v Michel's Patisserie (WA) P/L & Anor and Calmer P/L & Ors v Michel's Patisserie (WA) & Anor (No.2) [2010] FMCA 94 (12 February 2010)

Last Updated: 7 July 2010

FEDERAL MAGISTRATES COURT OF AUSTRALIA

O'BRIEN v MICHEL'S PATISSERIE (WA) PTY LTD & ANOR and CALMER PTY LTD & ORS v MICHEL’S PATISSERIE (WA) PTY LTD & ANOR (No.2)

[2010] FMCA 94

PRACTICE AND PROCEDURE – Strike-out application – contrary to Court’s approach to pleadings – largely unsuccessful strike-out claim. COSTS – Broad discretion as to costs – respondents to pay seventy-five per cent of applicants’ costs in each matter.

Federal Magistrates Act 1999 (Cth), s.79 Federal Magistrates Court Rules 2001 (Cth), Part 21

O'Brien v Michel's Patisserie (WA) Pty Ltd & Anor and Calmer Pty Ltd & Ors v Michel’s Patisserie (WA) Pty Ltd & Anor [2010] FMCA 7

Applicant:

ALAN AND JOANNE O'BRIEN

First Respondent:

MICHEL'S PATISSERIE (WA) PTY LTD

Second Respondent:

GRANT CADDY

File Number:

PEG 144 of 2008

Judgment of:

Lucev FM

Hearing date:

12 February 2010

Date of Last Submission:

12 February 2010

Delivered at:

Perth

Delivered on:

12 February 2010

First Applicant:

CALMER PTY LTD AS TRUSTEES FOR THE MERCAL FAMILY TRUST

Second Applicant:

VICKI MERRITT

Third Applicant:

GLENN ALEXANDER CALDWELL

First Respondent:

MICHEL'S PATISSERIE (WA) PTY LTD

Second Respondent:

GRANT CADDY (WA) PTY LTD

File Number:

PEG 146 of 2008

Judgment of:

Lucev FM

Hearing date:

12 February 2010

Date of Last Submission:

12 February 2010

Delivered at:

Perth

Delivered on:

12 February 2010

REPRESENTATION

Counsel for the Applicant:

Mr J. Robertson

Solicitors for the Applicant:

Williams & Hughes

Counsel for the Respondents:

Ms K. Levy

Solicitors for the Respondents:

QBM Lawyers

ORDERS
PEG 144 OF 2008

(1) The respondents pay the applicants’ costs of the respondents’ application in a case of 3 February 2009 in the sum of $1593.75 by 12 March 2010.
(2) The respondents file and serve its amended defence and any counter-claim by 5 March 2010.
(3) The applicants file and serve any reply and amended defence to any counter-claim by 26 March 2010.
(4) The respondents file and serve any reply to any defence to a counter-claim by 16 April 2010.
(5) The matter thereafter be referred for mediation before a Registrar of this Court, that mediation to occur on or before 14 May 2010.
(6) The matter be listed for a further directions hearing at 9:30am on 28 May 2010, if mediation has been unsuccessful.
(7) There be liberty to apply.
(8) The costs of today be reserved.

PEG 146 OF 2008

(1) The respondents pay the applicants’ costs of the respondents’ application in a case of 3 February 2009 in the sum of $1593.75 by 12 March 2010.
(2) The respondents file and serve its defence and any counter-claim by 5 March 2010.
(3) The applicants file and serve any reply and defence to any counter-claim by 26 March 2010.
(4) The respondents file and serve any reply to any defence to a counter-claim by 16 April 2010.
(5) The matter thereafter be referred for mediation before a Registrar of this Court, that mediation to occur on or before 14 May 2010.
(6) The matter be listed for a further directions hearing at 9:30am on 28 May 2010, if mediation has been unsuccessful.
(7) There be liberty to apply.
(8) The costs of today be reserved.

FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PERTH

PEG 144 of 2008

ALAN AND JOANNE O'BRIEN

Applicant

And

MICHEL'S PATISSERIE (WA) PTY LTD

First Respondent

GRANT CADDY

Second Respondent

PEG 146 of 2008

CALMER PTY LTD AS TRUSTEES FOR THE MERCAL FAMILY TRUST

First Applicant

VICKI MERRITT

Second Applicant

GLENN ALEXANDER CALDWELL

Third Applicant

And

MICHEL'S PATISSERIE (WA) PTY LTD

First Respondent

GRANT CADDY (WA) PTY LTD

Second Respondent

REASONS FOR JUDGMENT

(Ex tempore reasons revised and edited from the transcript)

The strike-out application

1. The strike-out application[1] sought to strike out in their entirety the two statements of claim in these matters.
2. The strike-out application was broad in its reach, argued seemingly every conceivable point – in the Court’s view, unnecessarily so – taking an excessively legalistic and formalistic approach contrary not only to the approach in this Court with respect to pleadings, but also the approach in other courts as well, and in some degree was perhaps lacking in that modicum of commonsense which ought occasionally to infuse the approach to such matters. By way of example, there were complaints about the meaning of ordinary English words to be interpreted. There were attempts to use or apply the law of contract with respect to implied terms in support of the strike-out claim on approach, which was described by the Court at para.52 of its reasons for judgment as misconceived.[2] There was, as counsel for the applicants mentioned, the attempt to strike out parts of the statement of claim on the basis that the activities were not in trade and commerce, and as the Court observed at para.58 of O’Brien (No. 1):
   • ...It is difficult to imagine a commercial activity more rooted in civilised human history than baking, albeit, in this case in the form of a retail patisserie.

There were attempts to strike out parts of the statement of claim with respect to future representations, which the Court described as resting upon “...an extremely narrow and isolationist reading...” of the relevant paragraphs,[3] and there were other comments in similar vein.

3. Overall, as observed to both counsel, as a result of the strike-out application there was barely a dint in the primary trade practices claim, and whilst the negligence and contract claims were struck out in their entirety, the cure for those was by relatively minor amendments.

Costs

4. The Court has, under the Federal Magistrates Act 1999 (Cth)[4] and under the Federal Magistrates Court Rules 2001 (Cth),[5] a broad discretion as to costs. Having considered the submissions of both counsel with respect to the quantum of costs that ought to be awarded, the Court takes the view that there ought to be an apportionment of the costs to reflect the relative degree of success of both parties. The respondents ought to pay the applicants’ costs in this manner at the rate of 75 per cent of the total costs which would otherwise be ordered. The Court considers that to be a fair reflection of the outcome in both matters.
5. Although the matter was argued on one statement of claim, there were nevertheless submissions filed with respect to both statements of claim, and it was necessary for both of the parties in preparation for the case, and ultimately the Court, to go through both statements of claim. Ultimately the judgment reflected the fact that there were slightly different rulings in each matter.
6. Having regard for the percentage quantum that the Court has just indicated, in each application the costs can be set as follows:
   1. at stage 2 for an interim application, $1465;
   2. plus a half-day daily hearing fee, which will be divided in half given that there was effectively only one argument at the end of the day, at $440 for that in each application;
   100. an advocacy loading, given the nature of the matter and the manner in which it was argued it is appropriate to certify for that, at half the usual fee in each application of $440 reduced to $220,

so the total amount of costs in each application will therefore be 75 per cent of $2125.

7. There will be an order that the respondents pay the applicants’ costs of the respondents’ application of 3 February 2009 in the sum of $1593.75. That order will be in each application.

Conclusion

8. With respect to the future conduct of the matter generally, and orders with respect to that, what the Court proposes is that there be orders that:
   1. the respondent file and serve a defence or amended defence, as appropriate, and any counter-claim by 5 March 2010;
   2. that the applicant file and serve any reply to the defence or amended defence, as appropriate, and in defence to the counter-claim, by 26 March 2010; and
   100. that the respondent file any reply to the counter-claim by 16 April 2010;
   4. the matter thereafter be referred for mediation before a Registrar of this Court, that mediation to occur on or before 14 May 2010; and
   5. that the matter be listed for a further directions hearing at 9:30am on 28 May 2010 if mediation has been unsuccessful;
   6. there be liberty to apply; and
   7. the costs of today be reserved.

I certify that the preceding eight (8) paragraphs are a true copy of the reasons for judgment of Lucev FM

Associate: S. Dinon

Date: 16 February 2010

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[1] Application in a case filed 3 February 2009 in both matters (“strike-out application”).
[2] O'Brien v Michel's Patisserie (WA) Pty Ltd & Anor and Calmer Pty Ltd & Ors v Michel’s Patisserie (WA) Pty Ltd & Anor [2010] FMCA 7 at para.52 per Lucev FM (“O’Brien (No. 1)”).
[3] O’Brien (No. 1) at para.64 per Lucev FM.
[4] Section 79.
[5] Part 21.