Canberra Cruises & Tours Pty Ltd & Ors v Commonwealth of Australia & Anor [2003] ACTSC 90 (13 November 2003)

Last Updated: 24 November 2003

CANBERRA CRUISES & TOURS PTY LTD AND ORS v THE COMMONWEALTH OF AUSTRALIA AND ANOR [2003] ACTSC 90 (13 November 2003)

PRACTICE AND PROCEDURE - Application to further amend statement of claim -

Application made at late stage - whether amendments seek to raise a new cause of action -

whether amendments time barred.

Trade Practices Act 1974 (Cth)

Limitation Act 1985 (ACT)

ACT Supreme Court Rules 0 32 r1 (6), 0 32 r1(2), 0 21, r5(5), 0 32 r1(7)

Cropper v Smith (1884) 26 Ch D 700

Queensland v J L Holdings Pty Ltd [1997] HCA 1; (1997) 189 CLR 146

Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353

Morgan v Banning (1999) 20 WAR 474

Weldon v Neal (1897) 19 QBD 394

No. SC 506 of 1997

Judge: Gray J

Supreme Court of the ACT

Date: 13 November 2003

IN THE SUPREME COURT OF THE )

) No. SC 506 of 1997

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: CANBERRA CRUISES & TOURS PTY LTD

ACN 008 440 427

First Plaintiff

RONALD MURRAY

CAN 008 468 666

Second Plaintiff

MURRAYS AUSTRALIA LTD

Third Plaintiff

AND: THE COMMONWEALTH OF AUSTRALIA

First Defendant

THE AUSTRALIAN CAPITAL TERRITORY

Second Defendant

REASONS FOR DECISION

Judge: Gray J

Date: 13 November 2003

Place: Canberra

1. By notice of motion dated 5 November 2003 the plaintiffs seek pursuant to 0 32 r1 (6) of the Supreme Court Rules (SCR) leave to file and serve a further amended statement of claim in this matter. The amendments proposed are extensive and the first defendant objects on various grounds to a number of them.

Background

2. This is a very long-standing matter in this Court, which for various reasons, has yet to come to trial. The originating application in this matter was filed in the on 9 July 1997. It is a claim in contract, tort, trade practices and defamation arising out of dealings between the plaintiffs and the Commonwealth of Australia over the operation of ferry and charters service provided by the plaintiff on Lake Burley Griffin, Canberra. The relationship between the parties to which this action relates commenced in late 1990 and originally alleged a breach of contract in August 1995 and its repudiation on 28 February 1997. The plaintiffs also claim that the defendant represented an exclusive right to operate a passenger or charter ferry service on the lake which representation the plaintiff alleged was false and amounted to misleading or deceptive conduct in breach of Section 52 of the Trade Practices Act 1974 (Cth) and misrepresentation under the law of the Australian Capital Territory. The pleadings also alleged estoppel and negligence arising out of the representation pleaded. In addition, a claim for defamation was made on the basis of comments made in relation to the matter by the then Chairperson of the National Capital Planning Authority in a radio interview on 4 April 1997.

3. An amended statement of claim was filed on 9 September 1997 and defences were filed on 12 November 1997 on behalf of both the Commonwealth as the first defendant and the Australian Capital Territory as second defendant. The Australian Capital Territory was joined in the proceedings as being, in effect, the agent of the Commonwealth of Australia in carrying out the Commonwealth's responsibilities after self government. The matter proceeded with interlocutory applications being made from time to time and eventually, after orders had been made for the plaintiffs and defendants to file and serve affidavits, the trial was eventually set down to commence on 24 February 2003. On the first day of the trial the first defendant was given leave to file a further amended defence and as a consequence the hearing dated was vacated. One of the consequences of the further amended defence was the admission by the first defendant that the second defendant had acted as its agent. Subsequently, the parties consented to an order that there be a verdict for the second defendant in the proceedings. Further orders were made and a timetable set for further and better particulars to be given, a reply to be filed, a further list of documents to be provided and further affidavits to be filed and served. The order also provided that the experts, which each party proposed to rely upon, provide a joint statement of the matters upon which they agreed and disagreed. The timetable provided various times for completion of all these matters, with the last matter being the filing of the further affidavits by 30 April 2003.

4. The trial has now been listed to commence on 1 December 2003. Accordingly this application for leave to amend comes at a very late stage in these proceedings and well after the matter was supposed to be ready for trial on 24 February 2003. It indicates a total failure of the case management process which was put in place to ensure that the matter come to hearing with the issues between the parties clearly defined.

5. The explanation given by the plaintiffs for the extensive amendments proposed was not particularly satisfactory. It really, I think, boiled down to the plaintiffs saying that a more detailed scrutiny of the materials, particularly particulars that had been given and responses made to those particulars gave rise to new perspectives from which the plaintiff's case could be put. However, the effect of some of these proposed amendments is to provide for causes of action in respect of which the first defendant objects on the ground that, as an action brought now, it would be statute barred. As well the first defendant objected to certain other of the proposed amendments that, it was said, would substantially change the basis upon which the first defendant has prepared for this case.

The principles relating to amendment

6. The power to order amendment is conferred by SCR 0 32 r1. It is expressly provided by SCR 0 32 r1(2) that -

All necessary amendments shall be made for the purposes of determining the real questions raised by or otherwise depending on the action, of correcting any defect or error in the action or of avoiding multiplicity of actions.

7. It was pointed out by Bowen L J in Cropper v Smith (1884) 26 Ch D 700 at 710 that the principle underlying this provision had as its object a decision as to the rights of the parties and was not there to punish them for mistakes they make in the conduct of their cases by deciding otherwise in accordance with those rights. He added at 711 -

It seems to me that as soon as it appears that the way in which a party has framed his case will not lead to a decision of the real matter in controversy, it is as much a matter of right on his part to have it corrected, if it can be done without injustice, as anything else in the case is a matter of right.

8. Although more recently the established practices and principles of case flow management are now considered in exercising a discretion to allow an amendment or not, the principles enunciated in Cropper's Case were expressly affirmed in Queensland v J L Holdings Pty Ltd [1997] HCA 1; (1997) 189 CLR 146 at 154. In particular, Dawson, Gaudron and McHugh JJ said that the principles of case management should not be employed other than perhaps in extreme circumstances to shut a party out from litigating an issue which is fairly arguable. They said -

Case management is not an end in itself. It is an important and useful aid for ensuring the prompt and efficient disposal of litigation. But it ought always to be born in mind, even in changing times, that the ultimate aim of a court is the attainment of justice and no principle of case management can be allowed to supplant that aim.

The form of the amended pleading

9. The further amended statement of claim proposed by the plaintiffs seeks to incorporate in it the particulars that have been provided over the course of this proceeding. A significant aspect of those particulars now pleaded is to merely refer back to a letter provided by the plaintiffs' solicitors to the solicitors of the first defendant dated 24 October 1997 in some instances, in others to refer only to a document or documents in what is said to be the "Agreed bundle documents". Expressed in that way, it is not easy to ascertain the particulars of the facts being pleaded. The plaintiffs put that the proposed amendments are already raised in the proceedings by the statement of claim, the reply and the particulars of pleadings which have been provided by letter. That may be so, but the particulars now pleaded were not part of the statement of claim attached to the original application or to the amended originating application. In any event it does not seem to me to be appropriate to allege particulars in a statement of claim by reference to documents which are provided as particulars extrinsic to the pleadings. After all, particulars control the generality of pleading and it is not helpful when specifying particulars in that pleading to do so by reference to extrinsic materials. In the present case I take it as a short hand method by which the facts that were alleged in the originating application and amended originating application were provided and put in issue.

The amendments sought

10. The first defendant did not oppose amendments consequential upon the verdict given in favour of the second defendant. Nor was there opposition to the proposed amendments relating to the provision of particulars at earlier stages in the proceedings or by reference to agreed documents. However, the first defendant took objection to the amendments to the statement of claim concerning what was said to be the "agreement" (paragraphs 5 and 6), those which sought to raise a new cause of action alleging a separate breach of contract not previously pleaded (paragraphs 7A to 7K), consequential amendments to the particulars of damage (paragraph 9B), matters concerning what was said to be the misrepresentation (paragraphs 10, 11, 11A, 11B and 11C) and matters related to the defamation proceedings (paragraphs 37A to 37G).

Paragraphs 5 and 6 of the further amended statement of claim

11. Paragraph 4 of the original statement of claim alleged the entry into a license agreement on or about the 18 October 1990 to operate a charter and ferry service for a period of 20 years. Paragraph 5 of the amended statement of claim added an alternative of what appeared to be such an agreement in or about February 1991. The plaintiffs now seek to amend the alleged term of the agreement in paragraph 5 from 20 years to 25 years. The defendant says that by changing the term the first plaintiff is now contending for two alternative agreements with differing material terms. The plaintiffs explain their position by reference to the situations postulated by the High Court in Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353 where the question of whether the parties had reached a final agreement or had intended to postpone contractual relations or intended to subsequently confirm the arrangement was canvassed. I consider that the first plaintiff should have the opportunity of having determined all of the issues surrounding the entry into the agreement. I also consider that the point made by the defendant that the pleadings if amended in this way lack clarity and contain ambiguous allegations which may be embarrassing is a valid point. I would allow the amendments sought subject to further clarification of the plaintiffs' pleadings to remove those ambiguities.

Paragraphs 7A to 7J of the further amended statement of claim

12. These paragraphs seek to raise a new cause of action alleging separate breaches of contract which has not been previously pleaded.

13. The first plaintiff relies on SCR 0 32 r1(6) which provides -

If an originating application identifies a cause of action arising out of any facts, an amendment may be made having the effect of adding or substituting a new cause of action arising out of the same or substantially the same facts and specifying the relief claimed in respect of that new cause of action.

14. The first plaintiff contended that the cause of action referred to in this sub rule should not be construed to mean the "form of action" but rather the facts which give rise to the cause of action, and that such a construction was adopted by the Full Court of the Supreme Court of Western Australia in Morgan v Banning (1999) 20 WAR 474. In that case the court pointed out that the fact that an amendment may be refused where it would prevent the opposite party from relying on a limitation defence (see Weldon v Neal (1897) 19 QBD 394) would not apply if the phrase "cause of action" in the counterpart rule in the Western Australian Supreme Court Rules was properly understood. Owen J said -

This issue falls away if the phrase "cause of action" in O 21, r5(5) is understood in a narrow sense as meaning a basket of facts which give rise to the right to approach the court for relief rather than as the description of the right to sue by reference to the old forms of action.

15. I do not understand the first defendant to be contending otherwise. However, if the amendment is permitted the first defendant does contend that it will be deprived of the benefit of the existing limitation defence pleaded to the previous cause of action. I do not see how that is so with respect to these amendments concerned with breach of contract. The limitation defences in the second amended defence were pleaded to the causes of action under the Trade Practices Act and damages in tort for negligence or negligent misrepresentation not to the breach of contract allegations. It is true that the effect of the amendment is to allege a breach which if it constitutes a new proceeding would now be statute barred. In any event, SCR 0 32 r1(7) enables me to give leave to amend notwithstanding that the period of limitation has expired if I consider it just to do so. The first plaintiff's submission is that looking at the first plaintiffs case overall it can be said that the facts now alleged which give rise to a form of action of breach of contract occurring on the occasions specified arise out of "substantially the same facts" as required by SCR 0 32 r1(6). On an overall consideration of the first plaintiffs pleadings including the particulars given, I think that this can be said to be so. There is a somewhat confusing pleading in paragraph 15 which alleges that the first defendant "falsified the representation" and apparently what is relied upon is the conduct related to such "falsification" which is now set out in paragraphs 7A to 7J as breaches of contract. A review of the pleadings as a whole and the particulars given seems to indicate that these facts are sufficiently raised and in issue. I am inclined to allow the proposed amendments to these paragraphs..

Paragraph 9B of the further amended statement of claim

16. This paragraph makes amendments to claim for damages consequential upon the amendments proposed in paragraphs 7A to 7J. The first defendant objects because it is said the proposed amendments make substantial changes to the methodology for assessing the amount of damages. In this case, reports from experts have been exchanged on the question of damages but no agreement has been reached even on what are the points of difference. Indeed, as I understand it the difficulty has been the first defendant's inability to come to terms with the first plaintiff's expert report. The proposed amendment may make this clearer, although the first defendant complains that the way the amendment changes the methodology is still not adequately particularised. It is of concern that this aspect will almost inevitably, as I understand it, result in the further postponement of the trial. However, if I permit the proposed amendment by way of paragraphs 7A to 7J I think that justice requires that the plaintiffs be permitted to amend their damages claim consequential upon that amendment being allowed. I propose to allow the amendment but I will entertain an application for further particulars in respect of it and the setting of appropriate timetables for resolution of the issues raised by this amendment.

Paragraphs 10, 11, 11A, 11B and 11C of the further amended statement of claim

17. These amendments relate to the representations made and claim damages for misrepresentation. The first plaintiff says that the amendments are intended to clarify the pleading of misrepresentation. I do not take the amendments as affecting the time at which any relevant cause of action may arise. The first defendant says that the paragraphs raise new causes of action based upon new facts. It is also put that each new cause of action is statute barred and sets up an entirely different claim to that which the first defendant has spent years preparing to meet. I note that the first defendant has already claimed the Limitation Act 1985 (ACT) in relation to the claims for negligent misrepresentation and I assume a similar claim can be maintained in relation to the claim as it is proposed to be framed. Again the desirability of ensuring that the real matters in controversy be litigated would incline me to allow these amendments subject, of course, to the defendant being at liberty to maintain its plea in respect of any Limitation Act defence. Paragraph 11A is unsatisfactory in its present form and should contain the particulars of loss which are said to be provided.

Defamation

18. The plaintiffs seek to extensively amend their pleadings in respect of his claim in defamation. Originally the defamation was said to arise out of a broadcast interview on 4 April 1997 on radio station 2CN concerning what the Chairperson of the National Capital Authority said about the second plaintiff. The plaintiffs now wish to allege republication by articles in the Canberra Times. That republication could sound in damages and the defendant objects on the basis that it has not had the opportunity to address this aspect. I would normally permit the amendment on terms which would enable the first defendant to do so. However, the republication alleged is then used to found further proposed amendments which allege publication by the second Plaintiff to the journalist who wrote the articles. That is presumably based on what is attributed in one of the articles, a portion of which is put in quotation marks. The pleading is confusing and, I would think, has a tendency to be embarrassing. That would appear to be accepted at least in part by the plaintiffs because in a letter dated 30 October 2003 in response to a query concerning proposed paragraphs 37C to 37E the plaintiffs' solicitor wrote -

We assume your query was based on a concern as to whether the allegations in paragraphs 37C - 37E are maintainable as a fresh cause of action. We do not accept that they are not maintainable. We do accept, however, that if the cause of action is maintainable then the repetition and republication cannot also be relied on in relation to damages for the earlier publication. The allegations in paragraphs 37C - 37E are only relied on for damages for the first matter complained of if the Court finds that they are not maintainable as separate causes of action.

19. In any event, subject to further argument, I would have thought that the article relied upon as a republication of a particular defamation can not be so if it is in fact the republication of separately alleged defamation on a second occasion.

20. The first defendant objects not only to the amendment as setting out a cause of action which would otherwise be statute barred, but also says the pleading of the imputations arising from the new cause of action are defective. This issue seems to me to be tied up in the consideration of whether what is alleged is a republication of what is alleged as the first defamation.

21. Unlike, the proposed amendments concerning the breach of contract I have not been provided with any explanation for the matters raised by these proposed amendments not being raised earlier. I do not propose to rule on the aspect of the proposed amendments concerning the defamation claims at this stage but will give the parties the opportunity to address further submissions.

22. I propose that the plaintiffs redraft their proposed amendments in light of these reasons. I will adjourn consideration of the plaintiffs' application to a date to be fixed.

I certify that the preceding twenty two (22) numbered paragraphs are a true copy of the Reasons for Decision herein of his Honour, Justice Gray.

Associate:

Date: 13 November 2003

Counsel for the plaintiffs: P Ward

Solicitor for the plaintiffs: Blake Dawson Waldron

Counsel for the first defendant: J Hilton

Solicitor for the first defendant: Australian Government Solicitor

Date of hearing: 7 November 2003

Date of judgment: 13 November 2003