Hadan v Jacksolo Pty Ltd[2023] QDC 237

DISTRICT COURT OF QUEENSLAND

1. Introduction

1. [1]
   The applicant seeks an order for substituted service of the proceedings on all three defendants under Rule 116 Uniform Civil Procedure Rules 1999 (Qld) (UCPR) which provides:

3. 116
   Substituted service

3. (1)
   If, for any reason, it is impracticable to serve a document in a way required under this chapter, the court may make an order substituting another way of serving the document.

3. (2)
   The court may, in the order, specify the steps to be taken, instead of service, for bringing the document to the attention of the person to be served.

3. (3)
   The court may, in the order, specify that the document is to be taken to have been served on the happening of a specified event or at the end of a specified time.

3. (4)
   The court may make an order under this rule even though the person to be served is not in Queensland or was not in Queensland when the proceeding started.

2. [2]
   The applicant also seeks an order for substituted service on the corporate first defendant under s. 109X(1)(b) Corporations Act 2001.  
3. [3]
   The applicant seeks the following orders:

3. 2.
   Pursuant to rule 116 of the UCPR and section 109X(1)(b) of the Corporations Act 2001 (Act), in lieu of personal service, sealed copies of the Claim and Statement of Claim filed herein on 2 August 2023 and a sealed copy of this order (Documents) be served on the Defendants by:

3. (a)
   sending the Documents by pre-paid post to the attention of the Second Defendant at Unit 13 “Managers Residence Top Floor”, 104 Miller Street, Bargara QLD 4670;

3. (b)
   affixing the Documents to the front door of the premises at Unit 13 “Managers Residence Top Floor”, 104 Miller Street, Bargara QLD 4670 to the attention of the Second Defendant;

3. (c)
   sending the Documents by pre-paid post to the attention of the First, Second and Third defendants at Unit 4, 82 Miller Street, Bargara QLD;

3. (d)
   affixing the documents to the front door of the premises at Unit 4, 82 Miller Street, Bargara QLD 4670 to the attention of the First, Second and Third Defendants;

3. (e)
   sending the Documents to [email protected];

3. (f)
   sending the Documents to [email protected];

3. (g)
   sending the Documents to [email protected];

3. (h)
   sending a text message to the Third Defendant at 0400 025 153 advising that the Documents have been served in accordance with paragraphs (a) to (g) herein.

3. 3.
   Service of the Documents be deemed to have been effected fourteen (14) days after the Documents have been served in accordance with subparagraphs (a) to (g) herein.              

4. The Law

4. [4]
   The threshold condition for substituted service under Rule 116 is that the applicant demonstrate that it is impracticable personally to serve the proceedings on the respondent.  These words speak for themselves, though reference is frequently made to Kendall v Sweeney [2002] QSC 404, where Justice Wilson said at [15]:

It may well be that the method of service proposed would be effective in bringing the proceeding to the attention of those respondents. However, that is not enough to justify the making of an order for substituted service. It must first be shown that it is impractical to serve the documents in a way required by chapter 4 of the UCPR.

5. [5]
   In Foxe v Brown (1984) 58 ALR 542, 547, Justice Mason, in speaking of “the standard of diligence or effort required of a plaintiff in seeking out a defendant in a case where substituted service is sought”, said:

That standard, however it is expressed, is one of reasonableness so as to show a practical impossibility of personal service. Furthermore, the question is not whether reasonable effort has been shown by the plaintiff over a particular period but whether at the date on which the application for substituted service is made that plaintiff, using reasonable effort, is unable to serve the defendant personally.

6. [6]
   Once the threshold condition is established, the Court’s discretion under Rule 116(2) is enlivened.  The discretion must be informed by the purpose of substituted service, which is to bring the proceedings to the attention of the other party.  Substituted service is not a way to meet the formal requirements of service without effecting actual notice of the proceedings.  If a party cannot be found, or if no reliable form of communication of the documents to the defendant is established, then the proceedings cannot progress.
7. [7]
   There must be a high degree of probability proved on the evidence that the proceedings will come to the attention of the other party by the method of service ordered.  The case frequently cited is Miscamble v Phillips and Hoeflich (No 2) [1936] St R Qd 272, 274 per Starke J, sitting in the High Court, where his Honour observed:

The object of substituted service, the primary object, is to bring to the knowledge of the person in respect of whom substituted service is sought the whole proceedings, so that he can take such steps as he thinks proper to protect his interests and rights. It is not proper to substitute service of process in a court of law when there is no belief that the service will bring the proceedings to the knowledge of the person in question or of any person representing his interests.

8. [8]
   Section 109X Corporations Act relevantly provides:

3. (1)
   For the purposes of any law, a document may be served on a company by:

3. (a)
   leaving it at, or posting it to the company’s registered office; or

3. (b)
   delivering a copy of the document personally to a director of the company who resides in Australia or in an external Territory.

3. (2)
   For the purposes of any law, a document may be served on a director or company secretary by leaving it at, or posting it to, the alternative address notified to ASIC under subsection 5H(2), 117(2), 205B(1) or (4) or 601BC(2). However, this only applies to service on the director or company secretary:

3. (a)
   in their capacity as a director or company secretary; or

3. (b)
   for the purposes of a proceeding in respect of conduct they engaged in as a director or company secretary.

3. (3)
   Subsections (1) and (2) do not apply to a process, order or document that may be served under section 9 of the Service and Execution of Process Act 1992.

9. [9]
   Despite the absolute language used in that provision, it has been held that a document will not be treated as served by post under this provision if there is proof that it was returned by Australia Post. Service may also not be effective if the person who delivered the document to a registered office had actual knowledge that it was not received by the company.^[1]

9. The Facts

10. [10]
    The applicants sue the first defendant (Jacksolo) for sums alleged to be due under a lease.  They sue the second and third defendants (Mr Morris and Ms Slade) as guarantors of the obligations of Jacksolo under the lease.  The lease was apparently signed by Mr Morris and Ms Slade on or about 30 June 2021.  It contained the following information:

    1. Jacksolo’s email address was [email protected] (the bargarainn e-dress^[2]);
    2. Mr Miller’s address was 13/104 Miller Street, Bargara (the 104 Miller St address); and
    3. Ms Slade’s address was as 4/82 Miller Street Bargara (the 82 Miller St address).
11. [11]
    The applicants recently have been involved in other proceedings against Jacksolo.  At some stage in 2022, they sued Jacksolo in the Magistrates Court in proceedings 3774/2022 for possession.  The relevance of those proceedings to this application is limited to the information relevant to service which they obtained during those proceedings. Relevantly:

    1. On 20 October 2022, Jacksolo by Ms Slade, filed court documents showing the address of Jacksolo to be 7 Bauer Street Bargara, and specified a mobile number 0400 025 153 and the email address [email protected] (the amandalee e-dress);
    2. On 27 October 2022, Jacksolo filed what was in substance a counterclaim in that proceeding, expressly by Ms Slade as sole director giving the residential or business address of Jacksolo as the 82 Miller Street address and the same mobile number and email address as above;
    3. The counterclaim was seemingly signed by Ms Slade and recited that the 82 Miller Street address is her address.
12. [12]
    Further, there were communications between the applicants’ solicitors, HWL Ebsworth (HWLE) and Ms Slade via the same email address, the amandalee e-dress, on regular occasions from October 2022 to 16 March 2023.  An email sent to that e-dress by HWLE on 11 May 2023 prompted an undeliverable notification recording the mailbox of the recipient to be full.  The next attempt to use this email address referred to in the evidence was on 13 November 2023 (see below).
13. [13]
    The applicants’ solicitors obtained two ASIC searches of Jacksolo.  The 19 August 2022 search disclosed:

    1. The registered office is a chartered accountant’s office at 24 Barolin Street Bundaberg;
    2. The principal place of business is the 82 Miller Street address;
    3. Ms Slade is the sole director and secretary and has been since 10 February 2021;
    4. Ms Slade gives her address as the 82 Miller Street Address.
14. [14]
    The 2 November 2023 search contains the same information.
15. [15]
    On 3 August 2023, the applicant began efforts to effect service of these proceedings.
16. [16]
    On that day, HWLE sent a sealed copy of the claim and statement of claim by express post to the registered office shown on the company searches.  On 14 August 2023 that letter was returned marked ‘RTS’ (return to sender) with the address struck through and unknown marked on a stamp on the envelope.   Undeterred, HWLE instructed Sharmans to attempt service by hand delivery on that address.  The response from Sharmans is inadmissible in the form in which it appears.^[3]  Putting that to one side, it states that one of the partners of the firm located at that address said that the firm was no longer a registered agent of Jacksolo and provided an unsigned copy of a Form 261 to that effect which was said to have been submitted on 16 May 2023.  Despite that, the chartered accountant’s address remained the registered office as at 2 November 2023.  In any event, ignoring the inadmissible evidence, it still appears that service by post on the registered address was ineffective.
17. [17]
    Also on 3 August 2023, HWLE instructed Sharmans to effect personal service of the claim and statement of claim on Mr Morris and Ms Slade as follows:

    1. HWLE instructed that the last known residential address they had for Mr Morris was the 104 Miller Street address, presumably based on the address given in the Lease signed on or about 30 June 2021.  No other basis to believe at that time that Mr Morris lived at this address was identified in the submissions nor could I locate one in the material.
    2. HWLE instructed that the last known residential address they had for Ms Slade was the 82 Miller Street address.  The applicant’s solicitors obtained a title search of that address and as of 28 February 2023 the registered proprietors of the 82 Miller Street address were Mr Morris and Tracey Lee Morris as joint tenants.  I assume Tracey Morris is a different person from Ms Slade.
18. [18]
    A licensed agent, Mr Nicholls, made efforts to serve on Mr Morris and Ms Slade at the addresses specified.

19. [19]
    As to Mr Morris, Mr Nicholls swore that he attempted to serve Mr Morris at the 104 Miller Street address on six occasions on 9, 23 and 31 August, 28 September and 4 and 10 October without success.  However there is more to the story.

20. [20]
    On 9 August 2023, at 7pm he attended and could not find any unit 13.  A male ‘property caretaker’ informed Mr Nicholls there was no unit 13 and no Brett Morris living at the address.  Mr Nicholls found an Audi with registration number BTM71 parked in a bay with a sign marked “reserved unit 13”.   Based on that evidence, there is no certain identification of Unit 13 and Mr Morris does not appear to live at the address.  
21. [21]
    On 23 August at 1.25pm Mr Nicholls again attended the address, could not find unit 13, spoke to a holiday tenant who did not know anyone in the block, found no car in the reserved space, and knocked on the door of the manager’s unit with no response.  That visit was fruitless.
22. [22]
    On 31 August at 7.00pm he attended the address, found the Audi (presumably the same one) parked in the reserved bay, knocked on doors and found only one holiday maker, knocked on the manager’s unit door and asked for Brett Morris and was told by a woman that she did not know anyone of that name, and told Mr Nicholls to mind his own business when he asked for her name.
23. [23]
    Based on that evidence, an occupant of the manager’s unit (presumably assumed by Mr Nicholls to be unit 13) told Mr Nicholls that she did not know Mr Morris.
24. [24]
    On the next three occasions, Mr Nicholls did not see the Audi, did not speak to anyone who knew the managers, knocked on the door of the manager’s unit with no response, and on two occasions there were lights on in the manager’s unit.
25. [25]
    Based on that evidence, there is no reason to believe that Mr Morris lives in the manager’s unit, there is evidence from two people that he does not, there is no basis to believe that Mr Morris owns the Audi or that Mr Morris lives in a “unit 13”.  

26. [26]
    There is further evidence before the Court in respect of Mr Morris in the form of an email from Alex Tallon of Sharmans.  That email appears to contain information provided by Mr Nicholls, though the email does not say that.  However I am willing to draw that inference.  The part of the email specifically relied upon by the applicants is as follows:

On 23/8 I gathered information from two reliable sources that confirm the male person I spoke to on 9/8 at the manager’s unit must have been the defendant Brett Morris, including a confirmation that he drives the Audi I saw in the parking lot in the bay marked unit 13.

27. [27]
    The email is exhibited to a solicitor’s affidavit but the deponent does not state that its content is adopted on information and belief.  All the deponent says is that it is correspondence she was copied into.  The catchall at the end of the affidavit does not fix that shortcoming.  She also could not give the evidence of the third parties referred to in the email.^[4]  Mr Nicholls (assuming he is the narrator) could arguably give the evidence on information and belief, but he does not.  Another difficulty might arise in the failure to identify the source, though that would not necessarily be a problem depending on what information was provided about the source which might make him or her able to be identified.^[5]   An interesting question arises in relation to whether an affidavit containing evidence sworn to on information and belief can admissibly give evidence of facts provided by a source who requires that their identity be absolutely concealed.  
28. [28]
    But there is a further problem with the evidence, even if admissible.  It is not stated how the unidentified sources could know that the person Mr Nicholls spoke to was Mr Morris.  They were not there.  It is not stated how they would know the Audi seen by Mr Nicholls (which they did not see) was Mr Morris’ Audi.  These are not mere technicalities.  Their statements might themselves be based on hearsay statements or mistaken assumptions.
29. [29]
    The content of this email was expressly relied upon by HWLE to sustain the relief sought against Mr Morris.  It is inadmissible and should not have been relied upon, particularly bearing in mind the duty of frankness on ex parte applications.^[6]

30. [30]
    Further, Mr Nicholls and HWLE have the number plate of the Audi.  No registration search has been undertaken. Similarly, it must be possible to find a photograph of Mr Morris for Mr Nicholls to consider. And no search was undertaken to identify unit 13 at the 104 Miller St address, or to identify the registered owner.  None of those steps seems difficult.
31. [31]
    There is no other evidence relating to Mr Morris.

32. [32]
    As to Ms Slade, Mr Nicholls swore that he attempted to serve Ms Slade at the 82 Miller St address on seven occasions on 9 (at 7.20pm), 23 (at 1:40pm) and 31 August (at 7:10pm), 28 September (at 7:15pm) and 4 (at 7:15pm), 7 (at 4:42pm) and 10 October 2023 (at 6:53pm).
33. [33]
    The result of those visits were that on no occasion did anyone answer the door at unit 4, on no occasion was there any noise from inside.  He was told by a woman who answered the officer number that he would be wasting his time coming to unit 4 looking for Ms Slade.  He was told by someone who lived in unit 3 that no Amanda Slade lived there. Mr Nicholls also attended 48 Lamb Street, Walkervale on 23 August at 3:00pm.  I am not sure why that address was tried, but two people there told Mr Nicholls that no Amanda Slade lived there.
34. [34]
    However, there are other matters to consider in respect of Ms Slade arising from Mr Nicholls’ evidence.
35. [35]
    On three occasions, Mr Nicholls rang the mobile telephone number given on the documents referred to above.  On each occasion he says that the call went to message bank and he left a message.  He does not say what the message contains nor whether it is a message apparently from Ms Slade.  He left a message asking that the recipient call Mr Nicholls.  It is not said whether he identified himself or the reason he was seeking to be called.  He also sent an email on one occasion to the amandalee e-dress and on one occasion to the bargarainn e-dress with the same request and no response.
36. [36]
    Finally, on 13 November 2023, Ms McCarthy of HWLE send a letter by email to, inter alia, the amandalee e-dress and on one occasion to the bargarainn e-dress.  It attached the claim and statement of claim, referred to the failed attempt to serve on the Jacksolo and the attempts to serve personally by Mr Nicholls, and asked for Ms Slade to arrange a time to be served.  It then foreshadowed this application if co-operation was not forthcoming.  As at 20 November 2023, Ms McCarthy had received no response.

32. Analysis: Mr Morris

37. [37]
    The applicants submit that reasonable attempts have been made to serve Mr Morris and it is impracticable personally to serve him as he is using avoidance tactics.  The evidence does not establish either proposition in my respectful view.
38. [38]
    First, the applicants rely on an address which was linked with Mr Morris in a document signed 2 years prior to the commencement of service attempts.  No step has been taken to identify whether that remains a current address for Mr Morris, much less a current residential address.  No electoral roll search, title search or other investigation has been made, at least on the evidence before me.  Rather, the efforts at service proceed from the assumption that “unit 13” is his residential address.
39. [39]
    Second, although it might be the case that the manager’s unit is “unit 13” given the parking space designation, I am not persuaded that it is.  (There are double hearsay opinions about this in the material, seemingly sourced from Mr Nicholls, but they are inadmissible.)  I do not see why this should properly be a subject of guess work and assumption when searches can be conducted to determine that issue with more certainty.
40. [40]
    Third, as I have already explained, the evidence which seems to link Mr Morris more firmly to the manager’s unit and an Audi is inadmissible and inherently ambiguous, even if considered.  No registration search of the Audi is in evidence.  Seemingly, no attempt has been made to obtain a picture of Mr Morris so Mr Nicholls could try to identify him as the person who came to the door on 9 August 2023 (even bearing in mind the potential for innocent error when identification occurs in that manner).^[7]
41. [41]
    Fourth, such admissible evidence as there is, indicates that Mr Morris does not live in the manager’s unit.  Unless one assumes that Mr Morris was hiding in the manager’s unit when Mr Nicholls knocked on the door (and there is no evidence of that), there is no evidence that any occupant of the unit was hiding inside to avoid service when Mr Nicholls called.  The fact lights were on in the manager’s unit hardly supports that inference.
42. [42]
    Given the above, no inference arises on the balance of probability Mr Morris is using avoidance tactics.  No inference arises that personal service is impracticable, given the steps not yet taken to locate Mr Morris. 
43. [43]
    It is a corollary of the above findings that I am also not satisfied that service on the 104 Miller St address will likely come to Mr Morris’ attention.  The applicants also submit that service on the 82 Miller Street address will come to Mr Morris’ attention.  It is correct that he is the registered proprietor of that property.  However, there is no evidence that he resides there or regularly receives mail or documents from the address, nor is there evidence that I could locate that he and Ms Slade are in some form of familial or personal relationship which would support the inference that service on one is service on the other.
44. [44]
    The application in relation to Mr Morris is dismissed.

45. Analysis: Ms Slade

45. [45]
    The applicants submit that reasonable attempts have been made to serve Ms Slade and it is impracticable personally to serve her as she is using avoidance tactics.  Although that submission has more strength in relation to Ms Slade than Mr Morris, I am not persuaded to the necessary standard that either proposition is correct.
46. [46]
    On the current evidence, I am not persuaded that Ms Slade in fact resides at the 82 Miller Street address.  I recognise that Ms Slade adopted the 82 Miller St address as her residential address in October 2022 and that it remains her address in the company search for Jacksolo.  However, there is no evidence that she is actually resident there or remained resident there in August 2023 and following. 
47. [47]
    Certainly, the evidence of Mr Nicholls’ attendances does not establish that Ms Slade is resident there, much less using avoidance tactics.  The evidence in paragraph [33] above does not support the inference that anyone (much less Ms Slade) was inside unit 4 on any occasion that Mr Nicholls visited.  There is no basis to infer that the woman Mr Nicholls spoke to on 9 August 2023 was Ms Slade and Mr Nicholls (inadmissibly) states that the woman was not the person in the photograph sent to him.^[8]  Further, it is Mr Morris who has the enduring legal connection to the 82 Miller St address as registered proprietor, not Ms Slade.  I refer to my observations in that regard in paragraph [43] above.  In short, Ms Slade might have moved.  As with Mr Morris, there is no evidence of an electoral roll search, nor any other inquiry to confirm Ms Slade’s residential address. 
48. [48]
    There is of course the evidence of Ms Slade’s lack of response to the amandalee e-dress and to the messages left on her mobile. 
49. [49]
    There is a reasonable basis to infer that the e-dress remains functional and remains an e-dress of Ms Slade.  People do not tend to change their e-dress in the way they move residence.  It appears from the solicitor’s affidavit that the email did not bounce back because the inbox was at capacity as it did when last used.  (I am assuming no such notification has been given since 30 November 2023.  If it had, it would have had to be disclosed to the Court.)  The difficulty with this evidence is that it is not reasonable simply to infer that a person keeps up with messages received to their inbox.  It is notorious that an email address can become flooded with irrelevant messages to the extent where it becomes an ineffective tool of communication.  Ms Slade has not sent an email from that e-dress for 6 months.  By itself it is not enough to persuade me to the necessary standard that a non-response indicates evasion of service nor that an email now sent to that address will come to her attention.
50. [50]
    There is also some basis to infer that Ms Slade still has the mobile number which was given in the Court documents last year.  I note however that there is no evidence of Ms Slade answering that number and no evidence of what Mr Nicholls said when he called.   The same considerations arise.  There is no evidence of a call ever being made from that mobile number by Ms Slade nor of Ms Slade making or answering it. 
51. [51]
    On the whole of the evidence, I am not persuaded that it is impracticable to serve Ms Slade nor that she is avoiding service.  I am also not persuaded that service on the 82 Miller St address and on the email and mobile contacts have a sufficient prospect of bringing the claim to her attention.
52. [52]
    It is an interesting question whether a person is actively avoiding service because they do not respond positively to a demand that they make themselves available to be served at the convenience of the plaintiff.  However, it is unnecessary to decide that interesting question on this application.
53. [53]
    I dismiss the application against Ms Slade.  As no mode of service apart from service on Ms Slade was proposed for Jacksolo, I also dismiss the application in respect of Jacksolo.

45. Additional comments

54. [54]
    Four comments.
55. [55]
    First, Bargara is not a large area.  Bundaberg is not a particularly large town.  It seems likely to me that reasonable efforts to locate or confirm the residence of either Mr Morris or Ms Slade will be successful, if indeed they remain in the area.  The problem with the evidence relied on is that it proceeds from the assumption that they reside in the two addresses given to Mr Nicholls, but that assumption is not made good on the evidence.
56. [56]
    Second, this Court has repeatedly stated that evidence on a substituted service application must be in admissible form.^[9]  Further, as explained in footnote 7 above, a substituted service application is an ex parte application.  That imposes a particular obligation on legal practitioners in my view to ensure admissible evidence is tendered (unless it is contrary to the applicant’s interests) and any submission made is reasonably open on the admissible evidence.  Ordinarily, a properly prepared substituted service application can be dealt with in short order.  Failure to comply with those obligations, however, results in judges having unnecessarily to dedicate time to analysing evidence and submissions and to sorting through the admissible and inadmissible evidence to determine if the relief sought can properly be given.  Another consequence can be that a judicial officer is led into error by relying on inadmissible evidence.  Legal practitioners should conduct themselves in a manner which avoids both outcomes.
57. [57]
    Third, it is certainly open to parties to bring these applications as applications for hearing on the papers.  However, it does have the result that if the Court has any difficulties with the material or submissions, there is no opportunity for the applicant to seek to address them.  The Court should not, and ordinarily will not, engage in a dialogue by email with an applicant, who does not appear, about shortcomings in the material.  The application should stand or fall on the material relied upon.
58. [58]
    Fourth, there is no reason why the Court should exercise its discretion to order costs against the defendants in respect of this application.  The Court makes no order as to costs of the application.