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Law firm loses fight to delay action against former director
A law firm with “complex, long and involved” litigation against a former employee over his alleged plot to form a new partnership has failed to delay Supreme Court proceedings.
Naomi Neilson
From at least 2006, Michael Wilson & Partners (MWP) has pursued action against John Forster Emmott, a former director and shareholder who was the alleged “backbone of a plot” to form a new partnership, known as the Temujin Partnership, from within the firm.
In the meantime, costs were issued against Emmott in the High Court of Australia. When this was not paid, a bankruptcy notice was served.
In August, following several proceedings between the two, Justice Michael Ball finally set down a hearing date for the inspection of Temujin for 18 November, but MWP sought to have this pushed back.
A month later, Justice James Stevenson dismissed a notice of motion filed by MWP because the firm “was in no position” to say whether or not counsel would be available for the five hearing dates in November.
MWP was also unwilling to give an undertaking that it would not seek to enforce the bankruptcy notice made in the High Court.
In the appeal of Justice Bell and Justice Stevenson’s decision, MWP claimed it would “suffer prejudice if the final hearing of this complex, long and involved proceedings” went ahead in November.
In submissions before Justice Julie Ward and acting Judge John Griffiths, MWP said its counsel would not be able to attend, expert and other witnesses would not be available, the firm needed to take “further steps” to obtain evidence, and its “only instructing solicitor”, Michael Wilson, could not appear due to client commitments.
MWP also alleged it was wrong of Justice Ball to “require” it to give an undertaking not to pursue the bankruptcy notice. In any event, that matter has been stood over until next February.
The firm added that “a correct balancing of justice between the parties would have the hearing dates reset from at least March 2025 onwards, once availability of witnesses and legal representatives is ascertained, and for a period much greater than five days”.
Justice Ward and Judge Griffiths said it could not accept MWP’s submissions “that there is no basis for [Emmott’s] claims of prejudice or that any such prejudice is significantly outweighed by the applicant’s state of unreadiness to proceed with the hearing”.
“Having regard to the lengthy history of these proceedings, it was not unreasonable or unjust for Justice Ball to proceed as he did and to have the matter set down for a final hearing when he did, in circumstances where the applicant had commenced the proceedings as far back as 2 February 2016,” Justice Ward and Judge Griffiths said.
On the issue of the bankruptcy undertaking, the appeal bench said it was not “erroneous” of Justice Ball to give this option in circumstances where the question of bankruptcy was likely to be affected by some of the issues in the November proceedings.
As for the counsel’s unavailability, the bench said this “may cause some inconvenience”, but MWP had more than two and a half months to engage a replacement counsel for November. For Wilson’s own unavailability, the court heard he was able to move his commitments.
“Turning then to the inability of the applicant’s two experts to travel to Australia to give evidence, that is hardly determinative. It is open to the applicant to apply to have their evidence heard by audio-visual link,” Justices Ward and Judge Griffiths said.
“As to the applicant’s desire to obtain further (unparticularised) evidence by way of subpoenas and notice to produce, it has had ample time since it commenced proceedings in 2016 to attend to such matters.”
The case is Michael Wilson & Partners v Emmott [2024] NSWCA 269 (15 November 2024).
Naomi Neilson
Naomi Neilson is a senior journalist with a focus on court reporting for Lawyers Weekly.
You can email Naomi at:
