A bitter battle: Cross & Spanner v Martin
After a "bitter, protracted, and undoubtedly costly" case, the Australian branch of Norton Rose Fulbright has been ordered to pay a former partner AUS$160,000 (£90,000) for tricking him into halting his case against it while it secretly pursued a case against him.
NRF made Tom Martin a fixed profit share partner in 2015, but demoted him the following summer after a "deterioration" of his relationship with Wayne Spanner, then the firm's Australia Managing Partner.
Martin disputed the decision and took his grievance to the Fair Work Commission, but halted his application on the understanding that NRF would not file its own application to stop his case in the Federal Court, and that the parties would mediate instead.
The Monday the arrangement was agreed, NRF equity partner David Cross emailed Martin's solicitors informing them that "we have stopped the process of filing the documents in the Federal Court".
But Cross had not stopped the process, and the firm's application meant Martin was then barred from pursuing his own Federal Court claim.
Martin sued over the perceived deception, which was denied by NRF with some eyebrow-raising defences.
NRF accepted that Cross's claim to have stopped the filing was “potentially misleading”, but it argued in court that he had merely used “infelicitous language”, and had intended to convey that he had "attempted" to stop the process.
Justice Iain Kerr said in his Federal Court judgment that "no plausible reading" supported that position, and that Cross's representation was "knowingly false".
Martin also sued over a second deception, where Cross sent Martin's team an email on the Friday of the critical week claiming that the process of filing the firm's application with the Federal Court "had progressed too far on Monday to be reversed".
Martin alleged that was false, pointing out that in the intervening days Cross rectified various issues with the application to ensure it was filed, including paying a late filing fee and adding a missing signature to it.
Justice Kerr ruled that Cross "well knew" that the firm would have been able to stop the process, "because he had had to take steps to secure that outcome. He had actively participated in ensuring that the process could be completed by arranging for the payment of the required filing fee".
NRF, though Cross' actions, was found guilty of intentionally misleading Cross twice and of backdating its application "in order to cover up the initial deception".
Justice Kerr said Martin's chances in his original case were negligible and only awarded damaged of $60, and he only added $470 damages for the backdated application. But he also awarded aggravated damages of $10,000 to compensate Martin for hurt and distress, and exemplary damages of $150,000.
"I am satisfied that an award of anything less than a substantial sum" would "merely irritate a large global and national law firm", the judge said, and while $150k was "modest" given the facts of the case, it was "sufficient to sting".
A Norton Rose Fulbright spokesperson said the firm "is considering what is a lengthy judgment and considering avenues for appeal".
"Respecting the judicial process, the firm will not comment further as to any aspect of this judgment or in regards to this long-running matter or its implications."
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