Court orders scandalous allegations against lawyers to be removed from the court file and sealed … Application to restrain plaintiff’s travel overseas made in the mistaken belief that he was about the leave the country … No basis in claim that lawyers acted unprofessionally … Seb Tonkin reports
Misunderstandings in NSW Supreme Court proceedings last year meant orders were made on a false basis, preventing a plaintiff leaving the country. The orders were sought ex parte during the trial by separate counsel before a different judge, and were discharged a week later.
Late last month Justice Francois Kunc dismissed the plaintiff’s motion to restrain the practitioners involved from acting further in the case, and found that allegations against the defendant’s lawyers in a letter and submissions by the plaintiff’s representatives were scandalous or oppressive and should be sealed and ordered not to be opened without further order of the court.
The lawyers against whom scandalous allegations were made were partners of Eakin McCaffery Cox and barrister Jonathan Hyde.
The serious allegations that Justice Kunc rejected were made by the plaintiff’s solicitors Bransgroves Lawyers and Sydney barrister Peter King.
Christopher Sharkey sued his former partner, Donya Mayahi-Nissi in 2013, claiming that she held certain property on trust for him. She brought a cross-claim in turn, and the matter was set down for trial before Justice Stephen Robb in February 2015.
Sharkey, along with several of his witnesses, lived in the United States. While Sharkey had originally made an application for those witnesses to give evidence by video link, it was ultimately decided that they would fly to Australia to give evidence on February 17, 2015, returning afterwards.
By email on January 30, Sharkey’s counsel Andrew Fernon told Justice Robb’s chambers and the other parties about the witness arrangements. Referring to the US witnesses (but not Sharkey), Fernon said that arrangements were being made for them to return to the US on a 2.30pm flight on Wednesday February 18. The initial plan had been for the witnesses to return on the evening of the 17th, but this was extended at Mayahi-Nissi’s solicitors’ request.
“If there’s any prospect of it going over there’s a little bit of time on Wednesday before they fly out of Australia at 2.30 on Wednesday, so there may be scope for some minor carry over into Wednesday. Mr Cook will then conclude with Mr Sharkey, if he hasn’t already, on the Wednesday, and then we have various other witnesses.”
In court at this point was Timothy Eakin from Eakin McCaffery Cox, one of Mayahi-Nissi’s solicitors, who mistakenly took Fernon’s statement as meaning that Sharkey would be returning to the US with his witnesses at 2.30pm that Wednesday, or even earlier.
He called his partner Mark Doble, and the two discussed the risk that Sharkey would flee the jurisdiction, leaving no assets to pay Mayahi-Nissi’s cross-claim.
The next day Doble and Eakin decided to seek orders that Sharkey be restrained from leaving Australia, surrender his passports, and pay nearly $550,000 into court. They retained Jonathan Hyde as counsel, and sought an ex parte hearing before Justice Robert McDougall – fearing that Sharkey might leave immediately if tipped off, and that Justice Robb would need to recuse himself from the part-heard trial if he heard the application himself.
On Wednesday February 18, Justice McDougall heard the motion, and made the requested orders – based on submissions from Hyde, including that Sharkey had plans to leave Australia immediately.
Sharkey was served with the orders that morning, and the next day filed an application for their discharge. Justice Robb referred the application back to McDougall J, but stated for the record that there had never been a suggestion that Sharkey would leave the jurisdiction after giving evidence.
On Wednesday February 25, Justice McDougall discharged the earlier orders and ordered Mayahi-Nissi to pay indemnity costs of the application, saying:
“In the circumstances, it seems to me that there was, and I accept by oversight or inadvertence, a material misstatement on a relevant fact. I accept that this occurred in the heat of the moment or the confusion caused by the need to have separate counsel making the application before me. Nonetheless, the fact is that it did occur.”
Despite the discharge of the orders, Sharkey was detained for a time at the airport that same evening, delaying his flight and causing his luggage to be lost for a month.
Justice Robb delivered judgment on September 2 in the main proceedings, which then continued (and continue) on the question of damages Sharkey owed for Mayahi-Nissi’s cross-claim.
After the September judgment Sharkey retained new solicitors in Bransgroves Lawyers, who wrote to Eakin McCaffery Cox seeking an undertaking that the firm, and Jonathan Hyde, who appeared on the restraint motion, recuse themselves from further involvement in the proceedings.
Justice Kunc ultimately described the letter, and written submissions based on it, as “hectoring and hyperbolical” and “scandalous or oppressive” – ordering that they be sealed in an envelope on the court file.
A formal application to restrain Eakin McCaffery Cox and Hyde from acting was finally filed on February 26, 2016 – a year after the restraint orders had been discharged.
The court’s inherent jurisdiction to restrain legal practitioners from acting for a party is exceptional and exercised with caution. In Kallinicos v Hunt, Justice Brereton outlined the test as being whether a fair-minded, reasonably informed member of the public would conclude that it was required for the proper administration of justice.
Due weight is given to the public interest in a litigant having their choice of lawyer, and to the cost, inconvenience, and impracticality involved.
Peter King was Sharkey’s barrister on the application and he argued that the lawyers involved in the ex parte application lacked independence and objectivity, and would undermine the integrity of the judicial process.
However, King ultimately did not submit that Hyde and Doble had actually known that their submissions or instructions were wrong – rather that Doble had failed to make reasonable and appropriate inquiries, and had therefore been grossly neglectful.
The respondents to the application – EMC Lawyers, Hyde, and Mayahi-Nissi – argued that the relevant conduct was simply not as “egregious” as described, that Hyde would not be playing any further part in the proceedings anyway, that there was nothing to excite the court’s exceptional jurisdiction, and that there had been an “unsatisfactory and unexplained delay” in bringing the application.
Justice Kunc rejected Sharkey’s application completely, saying he was not satisfied that the respondents had committed anything more than an innocent error. Lawyers, and “even judges”, sometimes think they hear things in court that are not ultimately borne out by the transcript. When urgency is perceived, a mistaken account may lead another person to read a transcript in a particular way.
Justice Kunc found that Doble had made reasonable inquiries. There was no basis for claims of unsatisfactory professional conduct, gross negligence, or an ulterior motive in bringing the ex parte motion. Given the nature of the misconception, it was natural that Eakin and Doble did not want to warn Sharkey of the orders being sought, and appropriate that the application was heard by another judge.
EMC Lawyers have foreshadowed an application for indemnity costs from Sharkey.