29 April 2010
In this case, Irish Bentley Lawyers represented David James Hambleton and Robert Eugene Murphy as joint and several liquidators of Castleplex Pty Ltd (In Liquidation) in the Supreme Court of Queensland seeking orders that a creditor (“the Respondent“) be restrained from commencing proceedings in the State of Queensland on the basis of the Respondent’s previous frequent incompetent, meritless or vexatious litigation.

Material Facts

Within a relatively short period of time, the Respondent commenced 31 proceedings in the District and Supreme Courts of Queensland. Of these proceedings, most of these proceedings were either unsuccessful or not proceeded with by the Respondent. Of these proceedings, two proceedings were filed by the Respondent in his capacity as creditor against the Applicants in their capacity as liquidator of Castleplex Pty Ltd (In Liquidation). These proceedings were unsuccessful.

The Applicants subsequently sought orders from the Supreme Court of Queensland to restrain the Respondent from instituting further proceedings pursuant to Vexatious Proceedings Act 2005 (Qld)

The Applicants asserted that the Respondent had commenced two vexatious and unsuccessful proceedings against them, being:

1. An appeal against an order of the Supreme Court of Queensland which dismissed the proceeding with costs; and
2. An appeal of a costs order.

Rather than consider the Respondent’s subjective intent in bringing the proceedings, the Applicant submitted that the Court ought to consider the proliferation of matters, their frequency, their lack of success, the basis for that lack of success (including that the proceedings were incompetent, or found to be completely without merit) and the conclusions reached by the Courts as to their nature.

Orders Made

The Court ultimately found that it was significant that the Respondent had failed to address many of the proceedings that he unsuccessfully pursued, and that in the absence of satisfactory evidence from the Respondent, that there was no sound reason to question the correctness reached by the Courts on a number of occasions that the proceedings filed by the Respondent were incompetent, without merit or vexatious.

The Respondent was declared to be a person who frequently instituted or conducted vexatious proceedings in Australia. The Respondent, by himself, his servants and agents, was prohibited from instituting proceedings in Queensland without the prior leave of a judge of the Trial Division of the Supreme Court of Queensland.

In the judgment, the Court also noted that The pursuit of vexatious proceedings which must be defended at substantial cost diminishes the assets available to a company’s creditors.

A copy of the decision is available online. The judgment was upheld on appeal to the Queensland Court of Appeal.