Egan v Posman[2018] QDC 53

DISTRICT COURT OF QUEENSLAND

1. [1]
   This is an application for default judgment pursuant to Rule 283 UCPR. Two substantive issues arise:

1. (a)
   Whether the claim and statement of claim were able lawfully to be served in Papua New Guinea without the Court’s leave; and
2. (b)
   Whether the claim and statement of claim have been served on the defendant.

Background

2. [2]
   The proceedings were issued in this Court on 3 February 2017. The plaintiff was, until recently, a well-known barrister practicing in Brisbane and on occasions in Papua New Guinea. The defendant was, and is, the principal of a law firm located in Port Moresby, Papua New Guinea. The plaintiff seeks default judgment for his claim for $329,874.52 plus interest as money due and owing under three retainer agreements with the defendant.

3. [3]
   The statement of claim relevantly provides:

1. The Plaintiff (Egan):
   1. Was at all material times a Barrister resident in, and duly admitted to practice, in, Queensland.
   2. Was at all material times a Lawyer duly admitted to practice as Overseas Counsel in Papua New Guinea.
   3. Was at all material times the holder of a practising certificate issued by the PNG Law Society entitling him to practice as Overseas counsel in PNG.

2. At all material times the Defendant (Posman):
   1. Was a Lawyer duly admitted to practice in Papua New Guinea (PNG).
   2. Was the registered business owner of the PNG law firm which the Defendant traded under the name and style of “Posman Kua Aisi” (the firm).
   3. Carried on the business of the provision of legal services by and through the firm.

3. In his capacity as Overseas Counsel, Egan has been briefed and retained by the firm to represent its PNG clients on many occasions since in or about 1999.

4. The bases upon which Egan was on each occasion so retained since 1999, as agreed to by Egan and duly authorised members of the firm who had approached him to be retained, were as follows:
   1. A duly authorised partner or employee of the firm would, from PNG, contact Egan in Australia, either by email, fax or telephone, and ask him if he was prepared to be retained by and briefed by the firm to represent a named client of the firm.
   2. Egan would then, by telephone, discuss the nature of the matter the subject of the offered retainer with the member of the firm who had called him, and thereafter state that he would agree to accept the retainer subject to the following terms:
      1. The firm would pay Egan’s return business class airfares from Australia to PNG as well as associated travel costs on each occasion of his travel to PNG for the purpose of his representation of one or more of the firm’s clients.
      2. The firm would pay Egan’s accommodation and meal costs on each occasion of his travel to PNG for the purpose of his representation of one or more of the firm’s clients.
      3. The firm, and not the client, would be responsible for the payment of Egan’s stipulated daily fee for each day or part thereof spent by him out of Australia, as well as extra fees rendered on an hourly basis and any fees for outstanding costs and outlays relating to work performed by him on behalf of the respective clients of the firm on whose behalf he had been retained by the firm.
      4. After rendering professional services pursuant to the retainer, Egan would, at intervals during the course of the retainer, and at the end of the retainer, prepare a Fee Note (expressed in AUD) detailing the professional services which had been performed by him pursuant to the retainer, and thereafter, the firm would accept delivery of such Fee Note by either fax or email.
      5. The firm would pay Egan’s fees by either electronic bank transfer or by bank draft within a reasonable time after the delivery of the Fee Note to the firm.
      6. The member of the firm to whom Egan had stipulated the terms on which he would accept the retainer would then cause to be confirmed to Egan, either in writing or orally, that his terms of engagement were acceptable to the firm.
      7. Upon confirmation to Egan that his stipulated terms of the retainer were acceptable, Egan would then commence providing professional services to the firm in his capacity as Overseas Counsel.
   3. The firm would cause Egan’s fees to be paid within a reasonable time.

5. Between in or about November 2014 and in or about December 2015, Egan was retained by members of the firm, as pleaded in paragraph 4 hereof, to represent three (3) clients (the clients) of the firm, namely:
   1. Fly River Provincial Government – November 2014
   2. Governor Amkat Mai – October 2015
   3. Governor Anderson Agiru – December 2015

6. Egan duly provided professional services to the firm on behalf of the clients in his capacity as Overseas Counsel, as set out in fee notes subsequently delivered by him to the firm.

4. [4]
   The statement of claim then proceeds to particularise the invoices unpaid in respect of each of the three retainers alleged.

5. [5]
   The plaintiff’s service of the proceedings in Papua New Guinea was sworn to in the following terms in the affidavit of Mr Mel filed on 31 January 2018:

3.On or about 10 February 2017 at or about 12:00 pm, I personally attended the office of the Defendant’s legal practice, located at Level 1, Mogoru Moto Building, Champion’s Parade, Port Moresbey, National Capital District in Papua New Guinea. The firm Posman Kua Aisi is one of the most prominent legal firms in PNG.

4.At the time of my attendance at the said office on 10 February 2017, I was able to confirm that Posman Kua Aisi Lawyers held instructions to accept service of the bundle of documents marked TM – 1 on behalf of the defendant because:

1. I asked the receptionist “Is Mr. Posman here? I have some documents to serve on him in a claim made by Mr Greg Egan.”
2. The receptionist replied by stating that she would check whether Mr Posman was on the premises
3. Mrs Mary Mora of Posman Kua Aisi Lawyers, a senior litigation secretary with the firm well known to me, then came to the reception desk and said to me “Mr Posman has instructed me to accept service of the legal documents on his behalf”
4. I then handed the Claim and Statement of Claim filed by the Plaintiff in the current proceedings on 3 February 2017 to Mr. Mary Mora. A true copy of the Claim and Statement of Claim appears at page 1 of the Exhibit.
5. I then requested that Mrs. Mary Mora sign the acknowledgement of service form appears at page 11 of the Exhibit.
6. In Papua New Guinea, the Defendant, Mr Posman, is a very senior lawyer who is described as being a “Big Man”. It is part of PNG culture that “Big Men” rarely allow personal service of documents to be made on them because it would be seen as a considerable loss of face and as an insult.
7. Even though the acknowledgement of service document only refers to service of the “Claim”, I can confirm that I did in fact serve the Claim and Statement of Claim by handing them both to Mary Mora. In PNG, when service of a Writ takes place, even though the Writ is served with the Statement of Claim to it, the Acknowledgement of Service document prepared in advance of any such service only ever records service of the Writ, and acknowledgement of such service, even though both such documents were in fact served. The same thing has happened here where even though both the Claim and Statement of Claim were served, only service of the Claim was acknowledged.
8. I have been serving legal process in PNG for approximately 5 years and can attest to the practice relating to service in PNG as referred to above.

[Underlining added]

6. [6]
   I make two preliminary observations about this evidence. First, the underlined passage contains an irrelevant conclusion. Second, the evidence about personal service on a so-called “Big Man” is irrelevant to the determination of this application.

7. [7]
   On the same day, the plaintiff’s solicitors filed a request for default judgment under Rule 283 UCPR. The registrar refused default judgment on the basis that the proceedings were required to be personally served and had not been so served. There was also a query as to calculation of interest.

8. [8]
   On 15 February 2018, the plaintiff filed an amended request for default judgment which made a number of corrections to the interest calculation, along with submissions on the validity of service by Mr Mel. The registrar again refused to grant default judgment because the registrar considered personal service under Rule 105 UCPR was required and had not been effected.

9. [9]
   Further, the registrar declined to refer the application to the Court despite the Plaintiff’s solicitors’ request to do so. The registrar’s view was that the request for default judgment has been determined, so it could not be referred to the Court for determination (whether under Rule 455(2) UCPR which does not seem to apply to Rule 283 or under Rule 982, which does seem to apply).

10. [10]
    Thereafter, the Plaintiff filed the application under Rule 283 which was listed for hearing before me on 28 February 2018.

11. [11]
    On 26 February 2018 at 5.25pm the Court received an email from Mr Gileng, who identified himself as a partner of Posman Kua Aisi Lawyers. Mr Gileng is shown as a partner of the defendant’s practice on the practice website. The email was sent in response to an email from the Court to the general email address of Mr Posman’s practice seeking submissions on the application.

12. [12]
    The 26 February email from Mr Gileng is important. It states:

Dear Ms Allan,

I refer to your email dated 26 February 2018 which was sent at 4.30pm.

I am a Partner of the Defendant trading as Posman Kua Aisi Lawyers.

We operate a legal practice in Port Moresby, Papua New Guinea.

The Plaintiff, Justice Greg Egan (now an Australian Federal Court Judge [sic]) who then practiced as a Barrister out of the Brisbane Bar was engaged by us on some matters here in PNG with the understanding that our clients will pay him. There are some fees outstanding for payment by our clients to which he sued us for recovery. We (Plaintiff and the Defendant) agreed to mutually resolve payment once we receive payments from our clients as initially understood by parties. Though we instructed the arrangement was that our clients will pay him. Accordingly, we understood that the claim will be held in abeyance and not pursued until parties can resolve. It is based on this understanding that we did not take any steps to defend the claim in court.

It is now apparent that the Plaintiff wishes to pursue the claim in Court despite our understanding. Please note that we will instruct a lawyer in Brisbane to defend the claim or alternatively speak with the Plaintiff to resolve it. We therefore, kindly request that His Honour Justice [sic] Porter QC takes this matter out of his list on Wednesday, 28 February 2018 and adjourn the claim for six weeks to Wednesday 17 April 2018 to enable us time to properly brief counsel or alternatively talk to Justice Egan.

Please kindly let me know by return email.

Kind regards,

Goiye Gileng (Mr) 

13. [13]
    On 27 February 2018, Mrs Temani-Chauka from Posman Kua Aisi sent an email to my associate seeking confirmation of receipt of Mr Gileng’s email. My associate confirmed receipt.

14. [14]
    Later that day, Mr Springer of the Plaintiff’s solicitor, with the consent of the Posman Kua Aisi and copied to that firm, informed my associate that the parties had agreed for the matter to be heard on 28 March 2018. My associate emailed both parties confirming that the application would be heard on that date. Mr Springer swears that he has heard nothing more from the defendant.

15. [15]
    The defendant did not appear when the matter was called on 28 March 2018.

Was the application properly brought?

16. [16]
    The application seeks default judgment under Rule 283 UCPR. That rule relevantly provides:

(1)This rule applies if the plaintiff’s claim against the defendant in default is for a debt or liquidated demand, with or without interest.

(2)The plaintiff may file a request for judgment for an amount not more than the amount claimed, together with—

(a)if interest is claimed—interest calculated, to the date of judgment, at the rate specified in the claim or in a practice direction for the Civil Proceedings Act 2011, section58 ; and

(b)the following costs—

(i)costs for issuing the claim;

(ii)costs for obtaining judgment;

(iii)any other fees and payments, to the extent they have been reasonably incurred and paid.

(3)If the plaintiff files a request for judgment under subrule (2), the court, as constituted by a registrar, may give judgment.

(4)For this rule, a debt or liquidated demand includes interest if the rate of interest is—

(a)limited to the rate specified in, and calculated in accordance with, an agreement; or

(b)not higher than the rate specified in a practice direction for the Civil Proceedings Act 2011, section58 .

(5)Subrules (6) to (8) apply if interest is claimed under the Civil Proceedings Act 2011, section58.

(6)If the plaintiff elects to abandon the claim for the interest, the claim is taken to be a claim for the debt or liquidated demand without interest.

(7)If the plaintiff elects to accept interest at a rate not higher than that specified in a practice direction for any period mentioned in the direction, the registrar may award interest under the direction, whether or not the defendant has paid the debt or liquidated demand after the proceeding is started.

(8)If the plaintiff seeks to recover a higher rate of interest than that specified in a practice direction for any period mentioned in the direction, the court may—

(a)decide the interest, if any, that is recoverable; and

(b)direct that judgment be given for the interest, whether or not the defendant has paid the debt or liquidated demand after the proceeding is started; and

(c)direct that judgment be given against the defendant under this rule.

(9)If the period for which interest is to be awarded is not specified in the statement of claim, interest is recoverable only from the date of the issue of the claim.

(10)If the court as constituted by a registrar is considering whether to give judgment, the registrar is not required to consider the merits of the plaintiff’s claim against the defendant.

Example: Under rule 982, the matter could be referred to a judge or magistrate for disposal, or for consideration and referral back, if the circumstances set out in that rule apply.

17. [17]
    I note that Rule 283(2) does not expressly provide for an application to the Court (it refers rather to a request) and it contemplates by Rule 283(3) that the Court as constituted by the registrar may give judgment. This raises the question of whether the matter has been properly brought before the Court by the application.

18. [18]
    Rule 982 provides one method for bringing a request for default judgment before a judge of the Court. As noted above, however, the amended request for default judgment was refused by the registrar. Accordingly, the registrar took the view (rightly in my opinion) that the matter could not then be referred to a judge of the Court under Rule 982.

19. [19]
    In that circumstance, it would have been open to bring the matter before a judge of the Court pursuant to Rule 791 UCPR, by way of appeal of the registrar’s refusal to grant default judgment on the amended request for default judgment.

20. [20]
    That Rule relevantly provides:

(1)A party to an application who is dissatisfied with a decision of a judicial registrar or registrar on the application may, with the leave of the court, have the application reheard by the court.

(2)If the court grants leave, it may do so on condition, including, for example, a condition about—

(a)the evidence to be adduced; or

(b)the submissions to be presented; or

(c)the nature of the rehearing.

(3)This rule does not apply to a review under rule 742.

21. [21]
    In my view, that Rule would apply notwithstanding that Rule 283 UCPR does not speak of an application for default judgment but rather speaks of a request for default judgment. It seems improbable that the intention of the drafters of Rule 791 was that it be construed in such a narrow manner as to exclude the decision of a registrar on a request for default judgment under Rule 283 (or the other similar Rules making similar provision in Rules 284-287). That conclusion is consistent with Justice Muir’s observation in MQF v Corry [2000] QSC 416 at [11] that a request to the registrar to renew a claim under Rule 24 UCPR was an application for the purposes of Rule 791 notwithstanding that that Rule 24 did not expressly provide for any request or application to the registrar to renew the claim.

22. [22]
    I also consider that the fact that the application in this case is an ex parte application would not take the matter outside the scope of Rule 791. I make that observation because Muir J (as his Honour was then) tentatively stated a contrary view in MQF v Corry. There his Honour expressed the tentative view that Rule 791 had no application to ex parte applications. He then observed:

[12]It is plain, I think, that the words "the application", in both cases, mean the application to which reference is first made in the sub-rule. It is not necessary for a party to a proceeding to be a party to an application brought in the proceeding. It will often be the case that one party seeks interlocutory relief against one (or more) of a number of respondents but not against all. Where an application is ex parte, it is made by one party without notice to and in the absence of the other. The other party may well be adversely affected by the application but it would not normally be described as being a party to it. R791(1) thus appears to confer a right of appeal from a decision made on the hearing of an application to persons who were parties to that application.

23. [23]
    Although I respectfully agree with his Honour’s tentative view that Rule 791 does not apply to a person seeking to appeal an ex parte decision where that person was not the applicant, I think the position would be different where the person seeking to appeal was the applicant.  

24. [24]
    However, that an appeal might have been able to be brought under Rule 791 does not lead to the conclusion that the application was wrongly brought by the plaintiff under Rule 283. In my view it is open to a party to bring an application to a judge of the Court for a default judgment under Rule 283. Rule 283(3) expressly provides that if a request for judgment is filed, the Court, as constituted by a registrar, may give judgment. However, it is to be noted that the rule confers power on “the Court” to give judgment and it is improbable that the drafters would have intended, by the express reference to the registrar, to thereby limit the power of the Court as constituted by a judge to give like relief. This conclusion is reinforced by the consideration that Rule 288 contemplates expressly that the Court will hear and determine applications for default judgment where no entitlement to apply to the registrar arises under rules 283 to 286.

25. [25]
    Further, any suggestion that a contrary conclusion arises from the express provision for appeals (Rule 791) and referrals to a judge of the Court (Rule 982) in respect of requests under Rule 283 is answered by reference to Rule 367(1), which permits the Court to direct that a request under Rule 283 be heard by a judge rather than a registrar.

26. [26]
    It might be contended that the application was not properly brought because there had already been two previous unsuccessful requests for default judgment. I do not think there is merit in that contention. A request for a default judgment is interlocutory in character. There is no prohibition on bring a further interlocutory application seeking the same relief, except to the extent that such further application is an abuse of process. Ordinarily, in a contested application, that is likely to require that there be a change in circumstances and/or evidence becomes available which could not have been put before the Court in the previous application. However, those considerations do not confine the circumstances in which a second interlocutory application could be brought. Each case depends on its particular circumstances, there are no absolute rules.^[1]I can see no reason why the further application in this case could be characterised as an abuse of process. As it is an ex parte application, the other party has not been previously vexed by the requests for default judgment. Further, the 26 February email is important evidence on the service issue and it was not available at the time of the amended request.

27. [27]
    In my view, it was open to the plaintiff to bring the application to a judge of the Court for relief under Rule 283 UCPR. In case there be any doubt about that, I direct under Rule 367(1) that the application be heard and determined by a judge of the Court.

Service outside Australia

28. [28]
    The defendant was not served in Queensland nor has he entered an appearance. However, service outside Australia is permitted without the Court’s leave under Rule 124 UCPR.

Rule 124(1)(g) provides that originating process may be served on a person outside Australia without the Court’s leave, relevantly, if it is for:

(g)a proceeding relating to a contract—

(i)made in Queensland; or

(ii)made by 1 or more parties carrying on business or residing in Queensland; or

(iii)made by or through an agent carrying on business or residing in Queensland on behalf of a principal carrying on business or residing outside Queensland; or

(iv)governed by the law of Queensland;

29. [29]
    The statement of claim demonstrates that the proceeding relates to a contract of retainer with a person who resided in Queensland. It is therefore a proceeding which falls within the scope of Rule 124(1)(g)(ii). Other paragraphs of Rule 124(g) could well apply, but one is sufficient to sustain the lawfulness under the Rules of service outside Australia in this case.

Has the defendant been properly served?

30. [30]
    Rule 129 UCPR applies Parts 1 to 5 of Chapter 4 of the UCPR (being Rules 100 to 122) to service of an originating process outside Australia. Rule 105(1) requires personal service of originating process. There is no doubt that Mr Posman was not personally served with the claim and statement of claim. However, Rule 129 permits service to be effected in any manner permitted for originating process under Rules 100 to 122. If service of the originating process occurs in a manner authorised by one of those rules, including Rule 117^[2], it will be proper service for the purposes of Rule 124.

31. [31]
    Of particular relevance to this application is Rule 117 which provides:

If—

(a)for any reason, a document is not served as required by this chapter but the document or a copy of it came into the possession of the person to be served; and

(b)the court is satisfied on evidence before it that the document came into the person’s possession on or before a particular day;

the court may, by order, decide that the possession of the document is service for these rules on the day it came into the person’s possession or another day stated in the order.

32. [32]
    Let it be assumed, as the registrar found, that the claim and statement of claim had not been served as required by Rule 105(1) because it was accepted by a litigation secretary at Mr Posman’s firm rather than served on him personally. If that is so, then so long as I am satisfied the proceedings came into his possession, on or before a particular day, I may order that the document was served on that day.

33. [33]
    In my view, the evidence of Mr Mel plainly sustains the conclusion that the document came into Mr Posman’s possession. It is extremely improbable that a litigation secretary who received a formal legal document for the principal of the firm at the firm’s premises, and who accepted the document expressly on Mr Posman’s behalf, would not give the document to Mr Posman. While I recognise that care must be exercised in an ex parte context in drawing inferences, I am satisfied on the evidence that Mr Posman received the proceedings on the day Mr Mel served them.

34. [34]
    Even if that were not thought to be enough to meet the requirements of Rule 117(b), reference may also be made to the email of 26 February. That email was sent by Mr Posman’s litigation partner, Mr Gileng. He acknowledges receipt and review of the claim. It is hard to imagine that this occurred without Mr Posman and Mr Gileng reviewing the claim and statement of claim. Even if it did not, the proceedings were clearly in the possession of the firm and therefore in Mr Posman’s actual possession as the principal of the firm.

35. [35]
    In those circumstances, I am satisfied that the claim and statement of claim had come into Mr Posman’s possession, at the latest, by 26 February 2018.

36. [36]
    Further, I consider that I ought to exercise my discretion conferred by Rule 117 for the following reasons:

1. (a)
   Actual service has been reasonably attempted;
2. (b)
   The defendant received the claim and statement of claim in a manner recognised as proper mode of service of originating process both in Queensland (Rule 115 UCPR) and in Papua New Guinea (see Order 6 Rule 8 National Court Rules 1983 (PNG));
3. (c)
   The defendant is a legal practitioner who has responded through his law practice to the proceedings, albeit informally; and
4. (d)
   The defendant has had a long standing connection with the plaintiff who resides in Queensland. It is a situation quite unlike that considered by Justice Jackson in AMCI P/L v Corcoal Management P/L & Ors [2013] QSC 50 at [30] to [33].

37. [37]
    Even if one assumes service under Rule 117 as at 26 February 2018, no defence has been filed in the time specified by the Rules.

38. [38]
    There are two other possible bases upon which proper service might have been disclosed on the material before the Court.

39. [39]
    The first basis is service under Rule 115. It provides:

(1)Despite parts 2, 3 and 4, a solicitor may accept service of a document for a party.

(2)The solicitor must make a note on a copy of the document to the effect that the solicitor accepts service for the party.

(3)The document is taken to have been served on the party, unless the party proves the solicitor did not have authority to accept service for the party.

(4)This rule applies whether or not personal service of the document is required under these rules.

40. [40]
    It could be argued that service was effected on Mr Posman in accordance with this Rule.

41. [41]
    However, my tentative view is that this rule would not apply to service on a person who was not a solicitor of this State. Even where legal practitioners practice under the title solicitor in a foreign jurisdiction, the term might not have the same precise meaning. Further, a solicitor of this State is familiar with the implications of accepting service under the rules as interpreted here. A solicitor in a foreign jurisdiction will not necessarily be subject to the same rules and even if they are, differences in practice and interpretation might exist.

42. [42]
    The second basis upon which service might be established is Rule 113 UCPR. This basis was advanced in submissions by the plaintiff’s solicitors to the registrar.

(1)This rule applies if—

(a)a proceeding is brought against a person in relation to a business carried on by the person under a name other than the person’s name; and

(b)the name is not registered on the Business Names Register; and

(c)the proceeding is started in the name under which the person carries on the business.

(2)The originating process may be served by leaving a copy at the person’s place of business with a person who appears to have control or management of the business at the place.

43. [43]
    There was evidence before me from the register maintained under the Business Names Act 1963 (PNG) that Mr Posman carries on business under the name of his firm. That was sufficient evidence to meet the requirements of Rule 113(1)(a). However, there was no evidence that that name was not registered on the Business Names Register maintained under the Business Names Registration Act 2011 (Cth) (unlikely as that might seem). Accordingly, service under that rule could not be established on the material before me.

44. [44]
    Finally, I should note that there is a without prejudice letter from Mr Posman’s practice and a reply from the plaintiff’s Papuan lawyers exhibited to the affidavit of Mr Mel. I have not read those letters.

Conclusion

45. [45]
    The orders I make are as follows:

1. (a)
   Pursuant to Rule 367(1) that the application for an order under Rule 283 UCPR be heard and determined by a Judge of the Court;
2. (b)
   Pursuant to Rule 117 UCPR that that the claim and statement of claim be taken to be served on the defendant on 26 February 2018;
3. (c)
   That judgment be entered against the defendant pursuant to Rule 283(3) in the amount of $329,874.52 plus interest pursuant to Section 58 Civil Proceedings Act 2011 in the amount of $55, 134.92; and 
4. (d)
   That the defendant pay the plaintiff’s costs on a standard basis.