Re Dennis Aloysius Lyons and Leonie Kay Lyons v Kern Konstructions (Townsville) Pty Ltd; Property Unit Nominees (No2) Pty Ltd [1983] FCA 33; (1983) 70 FLR 135 Qld G105 of 1982 Trade Practices - Practice and Procedure (7 March 1983)

FEDERAL COURT OF AUSTRALIA

Re: DENNIS ALOYSIUS LYONS and LEONIE KAY LYONS
And: KERN KONSTRUCTIONS (TOWNSVILLE) PTY. LTD.; PROPERTY UNIT NOMINEES (No.2)
PTY. LTD. [1983] FCA 33; (1983) 70 FLR 135
Qld G105 of 1982
Trade Practices - Practice and Procedure

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Fitzgerald J.(1)

CATCHWORDS

TRADE PRACTICES - applicants claim to have avoided or varied an Agreement for Lease, a Lease and a Bill of Sale together with damages for alleged breaches by the Respondents of ss. 52 and 53A of the Trade Practices Act 1974 - promises as to the future and predictions.

PRACTICE AND PROCEDURE - interlocutory application to dismiss, stay or strike out portions of the applicants' statement of claim - amended statement of claim - pleading state of mind of respondents - discovery - particulars - Federal Court Rules 0.12, rules 1,2,3,5 - principles to recognize when particulars are requested - summary intervention to deny applicants the trial of issues - allegations against second respondent embarrassing.

TRADE PRACTICES ACT, SS. 52 and 53A

FEDERAL COURT RULES, 0.12, rules 1,2,3 and 5

Practice and Procedure - Application to dismiss, stay or strike out portions of the applicants' statement of claim - Amended statement of claim - Pleading state of mind of respondents - Discovery - Particulars - Principles to recognise when particulars are requested - Summary intervention to deny applicants the trial of issues - Allegations against second respondent embarrassing - Federal Court Rules, O. 12, rr. 1, 2, 3, 5. The applicants had entered into an agreement for a lease with the first and second respondents. The applicants sought, inter alia, to avoid the lease and recover damages on the basis that statements alleged to have been made prior to the execution of the agreement for lease were in contravention of ss 52 and 53A of the Trade Practices Act 1974 (Cth).

The applicant's case as pleaded in the statement of claim involved as a central issue the respondent's state of mind. The respondents submitted that it was an abuse of process for the applicants to have made allegations that the respondents did not have any reasonable expectation that the offending statements were true without any evidentiary basis and merely in the hope of obtaining material which would assist them by discovery.

By motion, the respondents sought to have the proceedings dismissed or stayed, or alternatively for certain parts of the statement of claim to be struck out. The applicants applied for leave to amend the original statement of claim.

Held: (1) That in view of the fact that the applications were interlocutory, it was proper to assume in favour of the applicants that a contravention of the relevant provisions might be made out not only if it was established that the respondent's beliefs differed from what was stated, but if they merely did not have a positive belief in the accuracy of what was said or were recklessly indifferent as to its accuracy or otherwise.

Thompson v. Mastertouch T.V. Services Pty Ltd (1977) 29 F.L.R. 281; Reardon v. Aquajet Holdings (S.A.) Pty Ltd (1982) 2 T.P.R. 448, referred to.

(2) That the applicants were required by O. 12, rr. 1, 2, 3, and 5, to particularise the facts upon which they relied in support of their allegations that the respondent had no reasonable expectation that the subject of the statements was correct.

Fox v. H. Wood (Harrow) Ltd (1963) 2 Q.B. 601; Feeney v. Rix (1968) 1 Ch. 693, applied.

Burgess v. Beethoven Electric Equipment Ltd (1943) 1 K.B. 96, distinguished.

(3) That the applicants were unable to provide the particulars; however proceedings lacking particularity through want of information cannot be described as vexatious, frivolous or an abuse of the process of the court if the applicants can show that the circumstances are such that the respondents should be ordered to make discovery in advance of the provision of particulars.

(4) That discovery before particulars is not available as a matter of course; it is a matter of discretion and the exception rather than the rule.

Zierenberg v. Labouchere (1893) 2 Q.B. 183; Egg and Egg Pulp Marketing Board v. K. H. Korp Tocumal Trading Co. Pty Ltd (1963) V.R. 378, applied.

Waynes Merthyr Co. v. D. Radford and Co. (1896) 1 Ch. 29; Leitch v. Abbott (1886) 31 Ch. D 374; Cresta Holdings Ltd v. Karlin (1959) 1 W.L.R. 1055.

(5) That instances where discovery might be granted prior to particularisation include, inter alia, where, in a case involving fraud or other impropriety or defamation, the plaintiff can provide at least one instance of the conduct or publication; and may even be granted prior to delivery of the statement of claim or other pleading if exceptional circumstances exist and the discovery is necessary to the formulation of the pleading.

Arnold and Butler v. Bottomley (1908) 2 K.B. 151; Russell v. Stubbs (1913) 2 K.B. 200; Gale v. Denman Picture Houses Ltd (1930) 1 K.B. 588; Smith v. New Dempsey's Gold Mining Co. (1903) 29 V.L.R. 100; Herman v. Douglas (1922) 22 S.R. (N.S.W.) 317; Brydon v. Archibald (1938) Q.W.N. 5; Reid v. Frost Developments Pty Ltd (1964-5) N.S.W.R. 1683; Latec Finance Pty Ltd v. Jury (1960) N.S.W.R. 321 and Oswin v. Radio 2UE Sydney Pty Ltd (1968) 1 N.S.W.R. 461, referred to.

(6) That each case must be decided on its merits with the ultimate object being to mould the court's procedure to do justice between the parties.

Waynes Merthyr Co. v. D. Radford and Co. (1896) 1 Ch. 29; Millar v. Harper (1888) 38 Ch. D. 110; Ross v. Blake's Motor Co. (1951) 2 All E.R. 689, referred to.

(7) That discovery should not be made available to a party before pleading or particulars for the purpose of "fishing"; even if a fishing investigation is not what is intended, the proper balance of the competing considerations may require the court to refuse early discovery.

W. A. Pines Pty Ltd v. Bannerman (1980) A.T.P.R. 40-163; Hennessy v. Wright (1888) 24 Q.B.D. 445; Gale v. Denman Picture Houses Ltd (1930) 1 K.B. 588; Associated Dominion Assurance Society Pty Ltd v. John Fairfax & Sons Ltd (1955) 72 W.N. (N.S.W.) 250, applied.

R. H. M. Foods Ltd v. Bovril Ltd (1982) 1 All E.R. 673; Latec Finance Pty Ltd v. Jury (1960) N.S.W.R. 321, referred to.

(8) That certain of the allegations pleaded were not supported by particulars and involved a fishing expedition, and therefore should not be permitted to stand. Other allegations were based on statements and representations which could not bear the meanings attributed to them by the statement of claim. The proceedings against the second respondent were groundless and embarrassing.

Taco Co. of Australia Inc. v. Taco Bell Pty Ltd [1982] FCA 136; (1982) 42 A.L.R. 177; Parkdale Custom Built Furniture Pty Ltd v. Puxu Pty Ltd [1982] HCA 44; (1982) 56 A.L.J.R. 715; Jones v. Lipman (1962) 1 W.L.R. 832; Airlines Airspaces Ltd v. Handley Page Ltd (1970) Ch. 193, referred to.

(9) That the applicants should be permitted to apply for leave to deliver an amended statement of claim.

HEARING

Brisbane, 1983, February 22, 24; March 7. 7:3:1983
MOTION.

The respondents by motion sought to have the proceedings dismissed or stayed in whole or part, or alternatively an order striking out certain portions of the applicant's statement of claim. The applicants applied for leave to amend the statement of claim.

J. A. Dowsett Q.C., for the applicants.

C. W. Pincus Q.C. and R. E. Cooper Q.C., for the respondents.
Cur. adv. vult.

Solicitors for the applicants: Thomson Mann.

Solicitors for the respondent: Walsh Fitzgerald and Halligan.
P.H.M.

ORDER

1. The applicants' Statement of Claim filed on 15 October 1982, be struck out.

2. The applicants be refused leave to amend their Statement of Claim in accordance with the proposed Amended Statement of Claim handed up on 24 February 1983.

3. The applicants be at liberty to bring on an Application for leave to deliver an Amended Statement of Claim at 9 am on Friday 25 March 1983.

4. The respondents' motion filed herein on 22 February 1983 and the directions hearing in these proceedings be adjourned to 9 am on Friday 25 March 1983.

5. The applicants pay to the respondents the taxed costs of and incidental to all interlocutory proceedings herein to date.

Orders accordingly.

DECISION

The applicants claim in these proceedings to have avoided or varied an agreement for lease, a subsequent lease in respect of a shop in the "Northtown" shopping centre in Townsville, North Queensland, and a Bill of Sale later given to secure arrears of rental under the lease, together with damages for alleged breaches by the respondents of ss. 52 and 53A of the Trade Practices Act 1974 ("the Act"). An agreement for lease dated 19 October 1979 was entered into between the applicants and the first respondent, which was then the registered proprietor of the land upon which the shopping centre was almost completed. The second respondent, which was not incorporated until 25 September 1979, or registered in Queensland until 7 December 1979 is a joint venture company between Superannuation Fund Investment Trust and Kern Korporation Ltd. Kern Korporation Ltd is a member of the same group of companies as the first respondent. The first respondent assigned its interest to the second respondent at about the end of October 1979, in the period between the execution of the agreement for lease and the execution of the lease. The applicants and the second respondent entered into the lease on 5 November 1979. These proceedings were not commenced until 15 October 1982. The applicants' claims are founded upon statements alleged to have been made prior to the execution of the agreement for lease, which they say they relied upon in entering into that agreement. The lease is seemingly regarded as merely the inevitable consequence of the obligation thereby undertaken by the applicants.

There is presently before the Court a motion to have the proceedings dismissed or stayed in whole or in part, or alternatively for an order striking out certain portions of the applicants' original Statement of Claim. The applicants have applied for leave to amend their original Statement of Claim in accordance with a document which was handed up at the hearing of the interlocutory applications. It is common ground that such applications are to be determined by reference to the sufficiency of the proposed Amended Statement of Claim ("the Statement of Claim"), subject to one qualification. When the proceedings were earlier before the Court on 14 December 1982 on a directions hearing, the respondents raised objection to the applicants' original pleading. The directions hearing was adjourned and the applicants consented to an order that they file and serve on the respondents affidavits in support of their claim. They have done so, and concede that such affidavits contain the totality of the evidence available to them for the trial apart from such evidence as they may glean from the respondents on discovery.

A number of separate conversations are relied on by the applicants. It is most convenient to consider, in turn, the allegations which they make in relation to each. Paragraph 9 of the Statement of Claim contains the allegation that all statements and representations were made "with the intention and effect of inducing the applicants to enter into" the agreement for lease. The effect of paragraphs 4,6,7,8 and 9 of the Statement of Claim is to assert that each of the various persons who made a statement or representation did so as agent for both respondents. However, the affidavits associate the speakers only with the first respondent or the Kern Group. In the alternative, according to paragraph 21 of the Statement of Claim, each of the respondents was at all material times directly or indirectly knowingly concerned in what was said. No particulars of this allegation are given and no support for it emerges from the affidavits, particularly in relation to the second respondent.

The First Conversation Relied On:

According to paragraphs 4 and 5 of the Statement of Claim, the applicants discussed the prospects of their leasing a shop in the shopping centre with one David Campbell in about March or April 1979, and Campbell informed the applicants that:

"(a) all tenants taking shops in the said shopping centre would be required to take a three year lease on the same terms;
(b) all ground level tenants would pay rental at the same rate per square foot and all first level tenants would pay rental at the same rate per square foot;
(c) if it became obvious that the applicants were having major troubles it would be in the lessor's interests to release that tenant from his lease which words meant and were understood by the applicants to mean that such a lessee would be released from his lease;
(d) that the said shopping centre would be fully tenanted at the opening thereof."

Paragraph 6 of the applicants' affidavit deposes to a conversation in March or April 1979 with Mr Campbell, who is described as the first respondent's leasing manager, and to statements by him in the course of that conversation which support the allegations in sub-paragraphs (a), (b) and (d) above: see also paragraph 9 of the applicants' affidavit. Mr Campbell's statement in respect of the subject-matter of sub-paragraph (c) above was deposed to as being:

"If it becomes obvious you were having major troubles, it would be in our interests to let you out, or you could sell the value of the lease."

Other matters are also said to have been discussed on the occasion in question but none of them are of present significance save, perhaps, a statement by Mr Campbell in the following terms:

"The Centre will be well managed by Kern with a lot of opening and on-going promotion planned."

According to the applicants they informed Mr Campbell they would not take a shop in the shopping centre because the costs of setting it up, which Mr Campbell had explained to them, were too much. Nonetheless, there were later conversations upon which the applicants rely, to which reference will be necessary in due course. For the moment, it is appropriate to deal with the balance of the applicants' case founded on the statements pleaded in sub-paragraphs (a) to (d) supra of paragraph 5 of the Statement of Claim.

Paragraph 13(a) of the Statement of Claim alleges that the respondents have entered into other agreements for lease and leases upon terms substantially different from those given to the applicant. There is evidence in paragraph 19 of the applicants' affidavit and in an affidavit sworn by the applicants' solicitor that the conditions in all agreements for lease and leases which the respondents entered into were not identical and that some tenants were permitted to pay lesser rents than the applicants had been advised would be payable.

There is nothing in the material to indicate that there was any discussion concerning different terms or rental prior to a conference which took place on 24 October 1979 between the solicitor for the first respondent and the man who is now the applicants' solicitor but was then representing not the applicants but other prospective tenants in the shopping centre. However, paragraph 12(b)(i) of the Statement of Claim alleges that "the first and second Respondents at all material times were willing to enter into leases with retailers on terms substantially different from those required of the applicants. . . ".

Paragraph 13(f) of the Statement of Claim alleges that "at the time of opening the said shopping centre numerous shops were untenanted or tenanted on a short term basis only". Paragraphs 19 and 21 of the applicants' affidavit depose to facts which, if accepted, establish that the shopping centre was not fully tenanted when it was opened. Paragraph 12(b)(ii) of the Statement of Claim alleges that "the first and second respondents had no reasonable expectation that the said premises would be fully tenanted prior to opening". The applicants' affidavits do not directly touch upon this allegation. Neither in the Statement of Claim nor the affidavits is there any express statement as to what the applicants say was the relevant date at which the belief of each respondent and its reasonableness should be tested.

Paragraph 13(b) of the Statement of Claim alleges that "the Respondents have refused to allow the applicants to surrender their lease". Paragraph 22 of the applicants' affidavit says that in October 1981 the male applicant made an offer to surrender the lease to one Gordon Anderson who is identified in the affidavit of the applicants' solicitor as the "Controller Shoppingtowns for Kern Shoppingtowns Pty Ltd", but the offer of surrender was refused.

Paragraph 12(b)(vii) of the Statement of Claim alleges that "the Respondents had no intention of releasing any tenant from the provisions of such a lease should the said tenant be unable to meet his commitments thereunder". The affidavits do not directly deal with this allegation. The Statement of Claim and the affidavits do not state the date or dates at which the applicants say this intention (or absence of intention) materially existed.

The Next Conversation Relied On:

The next conversation upon which the applicants rely is dealt with in paragraph 6 of the Statement of Claim which provides:

"6. In or about the months of August or September 1979 the First and Second Respondents by their agent Allan Goodfellow had a conversation with the Applicants at the said building and in respect thereof as follows:-
Female Applicant :-
"Why are there only three lifts?"
Goodfellow :-
"Kern's idea is that people will get up to the first floor in the glass lift and they would have to walk all around the first level near all the shops and look for a way down. Anyway, there will be a walkway from the Council car park to the back of the shopping centre on the first floor in about twelve months."

In paragraph 11 of their affidavit, the applicants depose to such a conversation. According to paragraph 6 of the Statement of Claim, what was said by Mr Goodfellow was meant and was understood by the applicants to mean "that the glass lift situated in the centre of the building would be adequate to move potential customers from the ground floor to the first floor of the shopping complex and that a walkway would be constructed within 12 months from the Townsville City Council car park in Ogdon Street to the said shopping centre".

Paragraph 12(b)(iv) of the Statement of Claim alleges that "the number of lifts supplied was grossly inadequate for the anticipated number of people to be expected in the shopping centre". Paragraph 13(c) of the Statement of Claim alleges that "the glass lift has proved entirely inadequate for the flow of people through the said shopping centre". Paragraph 21 of the applicants' affidavit alleges that the glass lift was constantly out of action. Paragraph 23 of the affidavit also deals with lifts. It states:

(i) It was many months before the glass lift was working properly. People stopped using it when they became aware that it was likely to jam. In addition, what started out as a good gimick, namely a lift with glass in the front, eventually back-fired. The lift only took a maximum of 12 people and was painfully slow even when working properly. We observed that when people realised how slow it was and how long they had to wait for it, they just lost interest and went away.

(ii) The other two lifts also serviced the office accommodation above the first floor as well as the first floor which has the specialty shops where our shop was. It was quite clear that the lifts were constantly being used by persons conducting business with and within the upstairs offices and the lifts became to be known as basically not available for travelling up to the first floor to come to our shop. It was not until about February 1981 that the landlord installed a down escalator. An up escalator was there at the start. Until a down escalator was installed, customers were reluctant to travel up to the first floor as they could not get down in the glass lift which malfunctioned and was painfully slow and the other two lifts were being used by persons having business with the upstairs offices. This was so even though the walkway was in fact constructed from David Jones to the first floor of the shopping centre before the opening of the Centre".

Paragraph 13(d) of the Statement of Claim alleges that "no walkways have ever been constructed linking the said car park with the said shopping centre". That is substantially deposed to in paragraph 21 of the applicants' affidavit. Paragraph 12(b)(iii) of the Statement of Claim alleges that "the respondents had no reasonable expectation that a walkway from the said City Council would be constructed to the said shopping centre". That allegation is not directly dealt with in the applicants' affidavits. None of the applicants' material states, in relation to that allegation, the relevant date for determining what the respondents either expected or did not expect or for testing the reasonableness of their state of mind.

Further Conversations Relied On:

The next conversation relied upon allegedly also took place in or about the month of August or September 1979. By paragraph 7 of the Statement of Claim it is alleged that, in the course of that conversation, Gordon Anderson and Alan Goodfellow represented to the applicants:

"(a) that the estimated flow of the public through the said shopping centre would be 30,000 to 50,000 per week;

(b) that the lessor of the said shopping centre would conduct merchandising promotions of the various shops operated by tenants in the said building and of the wares and merchandises therein offered."

Paragraph 12 of the applicants' affidavit deposes to a conversation which they say they had in or about August or September 1979 with Alan Goodfellow in which he said, inter alia:

"Kern did a feasibility study even before the building started. The number of people through Northtown is estimated to be between 30,000 and 50,000 per week."

Paragraph 13(e) of the Statement of Claim alleges that the flow of people through the building has never exceeded 5,000 per week and on the first floor has never exceeded 1,000 per week. Paragraph 21 of the applicants' affidavit alleges that, after the initial opening interest and the Christmas buying in 1979, there was a sharp decline in the volume of traffic through Northtown in general and the first floor in particular. Paragraph 24 of the applicants' affidavit says:

"24. We say that the flow of people through the building has never averaged more than 5,000 per week and on the first floor never averaged in excess of 1,000 per week."

Paragraph 12(b)(v) of the Statement of Claim alleges that "the respondents had no reasonable expectation that the number of persons passing through the said shopping centre would approximate 30,000-50,000 per week . . . ". Again, nothing in the affidavits directly relates to that allegation. Nor does the applicants' material state the point of time which they say is relevant.

Reference has been already made to paragraph 6 of the applicants' affidavit in which it is alleged that Mr Campbell said to them inter alia:

"The Centre will be well managed by Kern with a lot of opening and on-going promotion planned."

Paragraph 13 of their affidavit alleges that at a meeting between August and October 1979, Mr Anderson said to them in response to their query as to the sort of promotions which would be conducted:

"Kern will do some and so will the Merchant's Association. The accent of both will be on merchandising, that is the promotion of wares and merchandise and what individual shops such as yours have to offer."

The time-span adopted, August to October, leaves open the possibility that the conversation took place after the agreement for lease had been executed.

Paragraph 13(g) of the Statement of Claim alleges that "no promotion of individual shops and their wares and merchandise has been conducted by the respondents or either of them".

Paragraph 14 of the applicants' affidavit complains that the initial promotion and the continuing promotion by the Centre Management centred upon entertainment. Paragraph 25 of that affidavit states:

"There was no proper promotion of individual shops such as ours including the wares and merchandise by Kern or by the subsequent Landlord Property Unit Nominees No. 2 Pty Ltd or either of them or the Merchant's Association in which they or either of them have a substantial influence".

Paragraph 12(b)(vi) of the Statement of Claim alleges that "the respondents had no intention of promoting individual shops in the said shopping centre or their wares or merchandise". Once again, that allegation is not directly dealt with in the affidavits. Nor does the material deal with the period of which the applicants make their allegations.

The Final Conversation Relied On:

The final conversation relied on is pleaded in paragraph 8 of the Statement of Claim which provides:

"8. In or about the month of October or November 1979 the First and Second Respondents by their agents Gordon Anderson and Allan Goodfellow represented to the Applicants that the number of persons passing through the shopping centre in the course of the first six weeks of operation would be equal to more than twice the population of Townsville."

The subject matter of this paragraph is dealt with in the applicants' affidavit in paragraph 16 in which a statement is attributed not to Mr Anderson or Mr Goodfellow but to Mr Dennis Lee who was "head of promotions for the Kern Group". The statement is said to have been made "in or about October/November" at a "Kern presentation night at Lowths Hotel "before the Centre opened. An exhibit to the applicants' solicitor's affidavit indicates that the Centre opened on 7 November 1979, so that Mr Lee's statement might have been made not only after the applicants had signed the agreement for lease with the first respondent but after they had signed a lease with the second respondent. It is consistent with this possibility that paragraph 15 of the applicants' affidavit alleges that the agreement for lease was entered into in reliance upon the statements and representations "hereinbefore referred to", which of course would not literally include Mr Lee's statement which is dealt with in the following paragraph, paragraph 16, which provides as follows:

"16. In or about October/November 1979 we were invited to a Kern presentation night at Lowthes Hotel before the Centre opened. We were talking to Dennis Lee who was head of the promotions for the Kern Group and he said that they estimated they would turn over the population of Townsville twice in the first six weeks of the opening promotion. The population of Townsville was then accepted to be about 100,000."

Paragraph 13(e) of the Statement of Claim, to which reference has already been made, alleges that "the flow of people through the building has never exceeded 5,000 per week and on the first floor has never exceeded 1,000 per week". Reference has already been made to the supporting material in paragraphs 21 and 24 of the applicants' affidavit, which arguably bear out the allegation in paragraph 13(e) of the Statement of Claim, notwithstanding that paragraph 21 of the applicants' affidavit seems to acknowledge a significantly higher volume of traffic through the shopping centre up to Christmas 1979.

Paragraph 12(b)(v) alleges, so far as presently relevant, that "the respondents had no reasonable expectation that . . . the number of persons passing through the said shopping centre in the first six weeks after opening would approximate twice the population of Townsville". No material in the applicants' affidavit deals directly with this allegation. Again, there is no express identification of what the applicants contend was the relevant time.

The Applicants' Loss:

In paragraph 22 of their affidavit, the applicants allege that their shop "never really traded profitably". They estimate that they were losing considerably in excess of $2,000 per month by October 1981 "because the volume of traffic through Northtown had dropped considerably". It was in that month that the male applicant made the offer to Mr Gordon Anderson to surrender the lease. As stated, the second respondent refused to accept that offer.

According to paragraph 26 of the applicants' affidavit, after the second respondent refused to accept a surrender of the lease, the applicants gave a Bill of Sale to the second respondent to secure the arrears of rent which were owing.

On 22 January 1982, the second respondent exercised its rights under the Bill of Sale and took possession of all the stock, fixtures and fittings from the shop. Presumably, from that point, the applicants ceased to be in possession of the shop or to carry on business there. The term of the lease, which was 3 years, has expired.

In paragraphs 27 and 28 of their affidavit, the applicants deal with expenditures which they have incurred, the losses they have sustained, and the liabilities to which they are still subject. They estimate that $80,000 to $100,000 was expended in payment of operating expenses, including rent on the shop, and on the acquisition of stock up until the time the second respondent exercised its rights under the Bill of Sale. From paragraph 14, it appears that they say that their operating expenses included $5,000 per year for advertising "over and above our contributions to the Merchant's Association". In the same paragraph they say that tenants had to spend a lot more on the promotion of their own shops than had been anticipated, including T.V. advertisements and newspaper advertisements which were far more extensive and expensive than had been expected, because the promotion by the Centre Management centred upon entertainment. It is unnecessary to deal further with the applicants' damages claims.

By paragraph 27 of their affidavit, the applicants blame the absence of an operating profit in their shop upon the fact that the number of people who visited Northtown generally and the first floor of the shopping centre in particular was considerably less than was stated and represented to them. In sub-paragraphs 13(f) and (h) of the Statement of Claim and paragraphs 19 and 20 of their affidavit, they relate the lack of custom to the untenanted shops and the use which the respondents permitted to be made of them. Reference has already been made to other allegations in which the applicants relate the shortage of custom to the lifts and the lack of a walkway to the City Council carpark.

There are provisions in the lease with respect to some of the topics allegedly discussed in the conversations upon which the applicants rely, e.g. the term of the letting, assignment by the tenant, the Traders' Association and promotion activities (which according to the affidavit of the applicants' solicitor was one of the matters which was differently dealt with in some other leases), and lifts. It is not appropriate in dealing with the present interlocutory applications to consider whether and if so how the formal documentation with respect to these and other matters might bear upon the ultimate resolution of the applicants' claims. Nor is this the time for detailed consideration of the significance of the applicants' conduct in continuing to operate their business under the lease and even giving a Bill of Sale in respect of arrears of rental after it would seem they must have known that they had been misled (if their allegations be true). Other matters aptly passed over at this stage include any questions concerning the respondents' liability for the conduct of the human agents involved or as to the relevant human mind or minds to be considered in assessing the state of mind of the respondents, and as to the ambit of the Court's power to grant the relief asked under s.87 of the Act.

The applicants' case, as has been presented, possesses serious deficiencies. The respondents are quite justified in objecting to the course which the applicants are pursuing. However, it does not follow that the proceedings should be dismissed or stayed. That drastic step would only be taken if it appeared that the applicants not only had not set up an arguable case for relief under the Act, but that they cannot do so, or that for them to do so in the circumstances would constitute an abuse of the process of the Court (Order 20, rule 2).

Vacant Shops and no Walkway

It is convenient to start with two of the alleged statements, one made in March or April that

"the said shopping centre would be fully tenanted at the opening thereof"
(Statement of Claim, paragraph 5 (d) Applicants' affidavit, paragraph 6),

and one made in August or September 1979 that

" . . . there will be a walkway from the Council car park to the back of the shopping centre on the first floor in about twelve months."
(Statement of Claim, paragraph 6 Applicants' affidavit, paragraph 11).

The applicants allege that each of these statments proved incorrect (Statement of Claim, sub-paragraphs 13(d) and (f), applicants' affidavit, paragraphs 19 and 21). Further, according to the Statement of Claim (sub-paragraphs 12(b) (ii) and (iii)), the respondents had no reasonable expectation that the premises would be fully tenanted prior to opening or that a walkway would be constructed in about August or September 1979. It was because of that absence of "reasonable expectation" that the statements are alleged to have been contraventions. The introductory words of sub-paragraph 12(b) of the Statement of Claim allege that the various statements and representations previously referred to "constituted conduct that was misleading or deceptive or was likely to mislead or deceive in that" (emphasis added), then follow the various sub-paragraphs of paragraph 12(b) to which reference has been made.

In view of the nature of the current interlocutory applications, it is proper to assume in favour of the applicants that a contravention of the relevant provisions might be made out not only if it was established that the respondents beliefs differed from what was stated but if they merely did not have a positive belief in the accuracy of what was said or were recklessly indifferent as to its accuracy or otherwise: of the proposition enunciated by Franki J. in connection with s.59 of the Act in Thompson v. Mastertouch T.V. Services Pty Ltd (1977) 15 A.L.R. 487, at p.495 which has been accepted more than once, and was recently applied by Fisher J. in Reardon v. Aquajet Holdings (S.A.) Pty Ltd (judgment delivered 13 December 1982). No occasion presently exists to consider whether there is, in any circumstances, any wider scope for a contravention of Part V of the Act by a statement as to the future, or the breach or non-fulfilment thereof, and no attempt was made by the applicants to argue that question, or to suggest that some distinction ought be drawn between promises as to the future and predictions. If it matters, it seems to me that, having regard to the nature of what was said, and the time at which and the circumstances in which the statements now in question were made, they were predictions not assurances. It was not argued that an innocent but erroneous statement as to the future can be properly characterized as likely to mislead, even if not as misleading. The form of the Statement of Claim clearly tied the alleged contraventions to the allegations in sub-paragraph 12(b). Central to this part of these proceedings, as the applicants' case is presently pleaded, is an issue as to the respondents' state of mind. The applicants' allegation that the respondents had no reasonable expectation may, at this stage of the proceedings, be taken as not relevantly dissimilar from an allegation of reckless indifference and the respondents did not suggest to the contrary. Relevant considerations may include not only belief, knowledge and intention but the matters, or lack of them, upon which such mental conditions were based.

The respondents submitted that it was an abuse of process for the applicants to have made allegations that the respondents did not have any reasonable expectation that the statements were true without any evidentiary basis and merely in the hope of obtaining material which would assist them by discovery. The applicants made the usual response that the requisite information was peculiarly within the knowledge of the respondents and also sought to contend that an inference could be drawn from the fact that the forecasts proved inaccurate.

The allegations that the respondents had no reasonable expectation that the forecasts would prove correct are allegations as to the state of mind of the respondents.

Order 12, rules 1, 2, 3 and 5 provide:

"1.(1) A party pleading shall state in the pleading or in a document filed and served with it the necessary particulars of any claim, defence or other matter pleaded by him.

(2) Rules 2 to 4 do not affect the generality of sub-rule (1).

2. A party pleading shall give particulars of any fraud, misrepresentation, breach of trust, wilful default or undue influence on which he relies.

3.(1) A party pleading any condition of mind shall give particulars of the facts on which he relies.

(2) In sub-rule (1) "condition of mind" includes any disorder or disability of mind, any malice and any fraudulent intention, but does not include knowledge.

5.(1) The Court may order a party to file and serve on any other party -

(a) particulars of any claim, defence or other matter stated in his pleading, or in any affidavit ordered to stand as his pleading;

(b) a statement of the nature of the case on which he relies; or

(c) where he claims damages, particulars relating to general or other damages.

(2) Without limiting the generality of sub-rule (1), where a party alleges as a fact that a person had knowledge or notice of some fact, matter or thing, the Court may order that party to file and serve on any other party -

(a) where he alleges knowledge, particulars of the facts on which he relies; and

(b) where he alleges notice, particulars of the notice.

(3) The Court shall not make an order under this rule before the filing of the defence unless, in the opinion of the Court, the order is necessary or desirable to enable the respondent to plead or for some other special reason."

Those rules, like the modern English rules, involve a departure from the previous practice under which no more was or could be required of a party than that he alleged a condition of mind which was an ingredient of a cause of action as a fact in his pleading. Particulars were not required and could not be ordered: Burgess v. Beethoven Electric Equipment Ltd (1943) 1 K.B. 96 (C.A.). Now, under the rules, particulars are required in the first instance of any condition of mind alleged other than knowledge, and particulars of knowledge may be ordered, although only after the defence is filed unless the Court is of opinion that it is necessary or desirable that the particulars be delivered in order to enable the respondent to plead or for some other special reason.

In Fox v. H. Wood (Harrow) Ltd (1963) 2 Q.B. 601, the defendant in an action for personal injuries raised contributory negligence against the plaintiff, alleging that he had stepped into a hole in floorboards when he knew or ought to have known of its presence. It was held that the plaintiff was entitled to particulars. At p.604, Diplock L.J., with whom Danckwerts and Ormerod L.JJ. agreed, said:

"In my judgment, the master was right in ordering particulars of the facts and circumstances from which the plaintiff ought to have known of the opening or of the hole. Mr Allen has argued that an allegation that someone ought to have known something, like an allegation that someone knew something, is an allegation of a condition of mind and that, therefore, by virtue of R.S.C., Ord. 19 r.22 particulars of it ought not to be granted. It seems to me that that proposition is an erroneous one. An allegation that a person ought to have known something has implicit in it not only an allegation that he did not know something which is an allegation of a state of mind, but also an allegation that facts and circumstances existed from which he ought to have acquired, either by observation or by inference, the knowledge of which he was deficient and that some fault, in this case amounting to contributory negligence, lies upon him in having failed to note, or draw an inference from, particular facts and circumstances. Of such facts and circumstances particulars ought to be given."

In Feeney v. Rix (1968) 1 Ch 693, the plaintiff claimed a declaration that a house which had been purchased in the name of his de facto wife was held on trust for them both in equal shares. He alleged that he and the defendant had contributed in equal shares to the purchase of the house and that he "never intended" that any contribution by him should be a gift to the defendant. Cross J. said at p.697B, after stating that the new rules altered the position completely:

"It follows, therefore, that if a party alleges that the other party intended on some occasion to make a gift of some item of property he must plead the facts on which he relies in support of the allegation. Further, if he alleges that the other party did not intend on some occasion to make a gift of some item of property he must plead the facts on which he relies in support of that allegation, for to say that someone did not intend to do something is just as much an allegation of a condition of mind as to say that he intended to do something."

His Lordship then referred to the judgment of Diplock L.J. in Fox's Case, supra. His judgment was affirmed by the English Court of Appeal.

In my opinion, the applicants were required by the rules to particularise the facts upon which they rely in support of their allegations that the respondents had no reasonable expectation that the shops would be fully tenanted when the shopping centre opened or that a walkway would be constructed from the City Council carpark within the period nominated. The applicants have not even pleaded the facts of which they allege the applicants had knowledge. Were I of the view that the rules did not require the applicants to provide particulars without an order under Order 12, rule 5, I would see force in the notion that such an order could and should be made consistently with sub-rule 5(3).

The respondents, however, did not seek particulars but an order for the summary termination of the proceedings. Reliance was placed upon the decision of the English Court of Appeal in Hytrac Conveyors Ltd v. Conveyors International Ltd (1983) 1 W.L.R. 44. In that case, an action for breach of copyright was dismissed for want of prosecution by reason of the plaintiff's failure to serve a Statement of Claim. The plaintiffs explained their failure by saying that it was difficult for them to plead because of the difficulty of going through the various affidavits which they had obtained in the course of their application for interlocutory injunctions against the defendants in order to find out what should be put in the Statement of Claim.

Whitford J. who granted the application to dismiss the action for prosecution said:

"It is not right that the plaintiff should start this action without knowing what form his statement of claim will take until after the interlocutory proceedings are completed. It is very important in a case concerning copyright and breach of confidence that the exact ambit of the plaintiff's claims be made known. . . . "

Lawton L.J. with whom the other members of the Court of Appeal agreed, said at the foot of p.47:

"For my part, I agree with that approach. It has to be remembered by all concerned that we do not have in this country an inquisitorial procedure for civil litigation. Our procedure is accusatorial. Those who make charges must state right at the beginning what they are and what facts they are based upon. They must not use Anton Piller orders as a means of finding out what sort of charges they can make. They must deliver their statement of claim within the time specified in the rules unless the court orders otherwise."

What was being spoken of there was a need for a plaintiff to be able to plead his case, not prove it, before commencing an action. It is not concerned with the evidence in the hands of the plaintiff at the time at which proceedings are commenced. Further, the action was not dismissed as vexatious or oppressive or an abuse of process, but for want of prosecution for non-delivery of a Statement of Claim within the time limited for that purpose.

I do not accept the wide proposition for which the respondents contend that Hytrac's Case is authority. They not only seek to found upon the statement quoted from Hytrac's Case as establishing a rule of general application as to when proceedings may be commenced, but attempt to extend it beyond the material facts required to be pleaded (O.11, r.2) to the particulars of those matters required to be stated by O.12.

The proper approach, as it seems to me, is to see this aspect of the present dispute as involving a contest, as so often occurs, between the respondents' entitlement to particulars from the applicants and the applicants' claim to have the delivery of particulars postponed until after they obtain discovery from the respondents. The applicants' inability to provide particulars is well established by the form of the Statement of Claim, their affidavits, and the concession candidly made by their Counsel. However, proceedings lacking particularity through want of information cannot be described as vexatious, frivolous, or an abuse of the process of the court if the applicants can show that the circumstances are such that the respondents should be ordered to make discovery in advance of the applicants providing particulars. For present purposes, I propose to assume in favour of the applicants that they will be entitled to discovery at an appropriate point in these proceedings, whether or not the respondents can object to disclosure: of Refrigerated Express Lines (A'Asia) Pty Ltd v. Australian Meat and Livestock Corp (1979) A.T.P.R. 40-137.

In Waynes Merthyr Co v. D. Radford and Co (1896) 1 Ch 29, a plaintiff in an action for deceit claiming damages for business allegedly lost by reason of the fraudulent acts of the defendant gave one specific instance in the Statement of Claim and alleged that the defendants had fraudulently supplied coal to divers other persons on divers other occasions. Chitty J. held that discovery should precede the particulars which the defendants requested. At p.35 he said:

" . . . There is no hard and fast rule as to the class of cases in which particulars should precede discovery, or discovery be ordered before particulars; but the judge must exercise a reasonable discretion in every case after carefully looking at all the facts, and taking into account any special circumstances."

His Lordship went on to conclude that the plaintiff's case had a substantial foundation and was not a fishing case, and said at p.36:

" . . . it seems to me that this is a case in which, having regard to the position of the parties and the admitted facts, and having regard to the circumstances that many of these alleged frauds are within the defendant's means of knowledge, and are not within the knowledge of the plaintiffs, I think discovery ought to precede particulars and I think this order should be made for the purpose of effecting justice between the parties, because I see the use which the defendants may be able to make of the order for particulars as originally made in chambers, in which event the plaintiffs might fail to obtain justice."

The latter comment was apparently directed to the defendant's explicit statement that they intended to seek to be relieved of the obligation to make discovery if the particulars were not delivered. The judgment continued:

"The usual argument has been addressed to me, that the plaintiffs ought not be allowed to rove through the defendants' books in order to make out a case; but for the reasons already given, I do not think it is applicable here."

In Leitch v. Abbott (1886) 31 Ch.D 374, the plaintiff alleged that he had employed the defendant as a stock broker but that the defendant had had in many of the transactions dealt with himself as principal and had also charged the plaintiff with monies not paid. The Court of Appeal held that though there were no particulars of the fraud alleged, the plaintiff was entitled to answers to interrogatories asking for details of the dealings by the defendant on behalf of the plaintiff and the names of the person with whom the defendant had dealt and the amounts paid. Commencing at the foot of p.376, Cotton L.J. said:

"There is here a general allegation of fraud and the Plaintiff wants the discovery to enable him to prove his allegation. It may be that he will afterwards have to amend his pleadings, but to say that he must give details of the fraud in the first instance would be to reduce the right of discovery in cases of fraud to very narrow limits indeed. . . . there is here a statement of the nature of the fraud alleged. The Plaintiff may hereafter have to condescend to particulars, but, in my opinion, it would be wrong to say that he is not entitled to have this discovery now, because he has not given full details of the fraud which he alleges. We may possibly have to decide to what extent the Defendant is obliged to go into all these matters, but, in my opinion, it would be wrong to say that the Court has a discretion to deprive the Plaintiff of discovery altogether, either until the trial of the action, or until he has given details of the fraud which he alleges. He wants the discovery in order to enable him to give those details, and to establish his right to relief at the trial. I think, therefore, that the Defendant must give a further answer to the interrogatories . . . ".

Commencing at the foot of p.378, Bowen L.J. said:

"Ought, then, the generality of an allegation of fraud to be a bar to the right to discovery? It seems to me that the very fact that the pleader is unable to plead except in general terms, is in many cases the very reason why he should have discovery from the other party, so as to enable him to plead the fraud in detail. If at a particular stage of an action you are stopped by reason of your ignorance of some fact which is known only to the other party, that is the very reason why you should have discovery of that fact from him, and what difference does it make whether you are stopped at the trial or before? . . ."

However, in Zierenberg v. Labouche (1893) 2 Q.B. 183, Lord Esher M.R., in a judgment with which Bowen L.J. expressed entire agreement, said at p.188 that the decision in Leitch v. Abbott, supra, was founded on the relationship between the parties. In Zierenberg, the rule that particulars must normally be given before discovery in support of a plea of justification in a libel action founded on a generally expressed defamatory statement was re-affirmed.

The three decisions mentioned afford illustrations of the exercise of the discretionary judgment which it is accepted is called for (Egg and Egg Pulp Marketing Board v. K.H. Korp Tocumal Trading Co Pty Ltd (1963) V.R. 378). Another example of an order for discovery before particulars in a proceeding involving allegations of impropriety is afforded by Cresta Holdings Ltd v. Karlin (1959) 1 W.L.R. 1055. It was there alleged that a defendant bank into which the plaintiff sought to trace the proceeds of the conversion of a number of cheques which had been drawn fraudulently did not receive the cheques as purchasers for value without notice. An order requiring the plaintiffs to give particulars relating to the notice which the bank allegedly had required them to do so after discovery. The judgment of Salmon J. was affirmed by the Court of Appeal. At the foot of p.1058, Hodson L.J. said:

"The plaintiffs, no doubt, are in difficulty at the present time in framing such particulars. Their knowledge must, I suppose, be very limited; but they have by this order the opportunity given them to consider all the relevant documents which have been disclosed upon discovery before tying themselves to particulars."

However, discovery before particulars plainly is not available as a matter of course. It is the exception rather than the rule. In Zierenberg, supra, Lord Esher M.R. said at p.188:

". . . Such discovery has never been allowed in the absence of some relationship between the parties to the action, except under exceptional circumstances, such as one party keeping back something which the other was entitled to know. . . ."

The ability of a plaintiff in a fraud action to provide one or more specific instances seems to have been accepted as sufficient to enable him to have discovery before being required to particularize further examples of the defendant's misconduct of which he is not and could not be aware: see per Farwell L.J. in Arnold and Butler v. Bottomley (1908) 2 K.B. 151, 157. Somewhat similarly, in Russell v. Stubbs (1913) 2 K.B. 200, a plaintiff who was able to specify one person to whom a trade journal had published a defamatory statement concerning the plaintiff was held entitled to discovery before particularizing the other persons to whom it was alleged it had been published. Discovery may even be granted before delivery of a statement of claim or other pleading if exceptional circumstances exist and the discovery is necessary to the formulation of the pleading: see Gale v. Denman Pictures Ltd (1930) 1 K.B. 588, Smith v. New Dempsey's Gold Mining Co (1903) 29 V.L.R. 100; Herman v. Douglas (1922) 22 S.R. (N.S.W.) 317; Brydon v. Archibald (1938) Q.W.N. 5; Reid v. Frost Developments Pty Ltd (1964-5) N.S.W.R. 1683; Latec Finance Pty Ltd v. Jury (1960) N.S.W.R. 321 and Oswin v. Radio 2 VE Sydney Pty Ltd (1968) 1 N.S.W.R. 461. In W.A. Pines Pty Ltd v. Bannerman (1980) A.T.P.R. 40-163, Brennan J. with whose judgment Bowen CJ and Lockhart J. agreed, said at p.42,286:

"Though the power to require discovery be acknowledged, how should it be exercised? It depends upon the nature of the case and the stage of the proceedings at which the discovery is sought. In the present case discovery is sought before there is a title of evidence to suggest that the Chairman did not have the requisite cause to believe which para. 6 of the Statement of Claim would put in issue. Some assistance was sought to be derived from cases where discovery had been given to a party before he was required to give particulars of his claim: cases such as Ross v. Blake's Motors (1951) 2 All E.R. 689 but in cases of that kind there is either an anterior relationship between the parties which entitles one to obtain information from the other, or sufficient is shown to ground a suspicion that the party applying for discovery has a good case proof of which is likely to be aided by discovery. This is not such a case. This is a case where a bare allegation is made by para. 6 of the Statement of Claim and, the paragraph being denied, the applicant seeks to interrogate the Chairman and ransack his documents in the hope of making a case. That is mere fishing. As Smithers J. said in Melbourne Home of Ford Pty Ltd v. TPC (supra) at p.18,087:

'In the absence of such evidence the proceeding is essentially speculative in nature. In such circumstances for the Court to assist the applicants by making available to them the processes of interrogatories and discovery would be to assist them in an essentially fishing exercise and from this the Court on established principles should refrain.'

His Honour's refusal of discovery was right and it ought not to be disturbed."

See also R.H.M. Foods Ltd v. Bovril Ltd (1982) 1 All E.R. 673 (C.A.).

Each case must be decided on its merits and particular circumstances. The ultimate object is to mould the Court's procedure to do justice between the parties: Waynes Merthyr Co v. Radford, supra; Millar v. Harper (1888) 38 Ch.D 110, 112 per Bowen L.J. Ross v. Blake's Motor Co (1951) 2 All E.R. 589 (C.A.). However, throughout all the cases, there is an insistence that discovery not be made available to a party before pleading or particulars for the purpose of "fishing". Even if a fishing investigation is not what is intended, the proper balance of the competing considerations may require the Court to refuse early discovery: see Latec Finance Pty Ltd v. Jury, supra, at p.323.

The following three passages amply illustrate what is meant by fishing. In Hennessy v. Wright (1888) 4 Q.B.D. 445, n, Lord Esher M.R. said:

"The moment it appears that questions are asked and answers insisted upon in order to enable the party to see if he can find a case, either of complaint or defence, of which at present he knows nothing, and which will be a different case from that which he now makes, the rule against 'fishing' interrogatories applies."

In Gale v. Denman Picture Houses Ltd, supra, Scrutton L.J. said at p.590:

". . . A plaintiff who issues a writ must be taken to know what his case is. If he merely issues a writ on the chance of making a case he is issuing what used to be called a "fishing bill" to try to find out whether he has a case or not. That kind of proceeding is not to be encouraged. For a plaintiff after issuing his writ but before delivering his statement of claim to say, 'Show me the documents which may be relevant, so that I may see whether I have a case or not', is a most undesirable proceeding."

In Associated Dominion Assurance Society Pty Limited v. Sir John Fairfax & Sons Limited (1952) 72 W.N. (N.S.W.) 250, Owen J. said at p.254:

"A 'fishing expedition', in the sense in which the phrase has been used in the law, means, as I understand it, that a person who has no evidence that fish of a particular kind are in a pool desires to be at liberty to drag it for the purpose of finding out whether there are any there or not."

In my opinion, these proceedings, insofar as they relate to the allegations now under consideration, are nothing but a fishing expedition. There is no intrinsic reason why a statement more than six months in advance of the opening of a shopping centre that it will be fully tenanted when it opens should not accurately reflect a view honestly held at that time; nor why a statement that, in 12 months, there will be a walkway between two points should not equally be the subject of a genuinely held belief. The applicants do not point to any justification for their allegations. They do not say that the respondents had not arranged any tenancies or even commenced to do so, or that they had not carried out any studies, or received any advice from real estate agents etc. Similarly, they do not say that there had been no discussions between the respondents and the City Council concerning the walkway or otherwise indicate some basis for their allegations. They no doubt could have obtained information from the Council over the years which have elapsed from 1979 to the commencement of these proceedings but have not bothered to do so. Their position simply is that they should be able to make the allegations in general terms and then find out whether they are right or wrong, and what if anything there is to support them, by access to the respondents' records. They do not even fix upon particular dates for the alleged conversations, which presumably are the points at which the contraventions are said to have occurred, but fix each conversation only by reference to a period of two or more months, thereby of course greatly expanding the potential ambit of discovery. In my opinion, the approach adopted by the applicants exceeds any reasonable latitude which might be permissible in order to accommodate any disadvantage they are under in trying to plead and prove the state of the respondents' minds.

Accordingly, I do not consider that the applicants' present allegations in relation to the occupation of the shopping centre or the walkway ought be permitted to stand. On the other hand, I propose to give the applicants' a further chance to raise these matters in proper form. I am conscious that it is an extremely grave matter to shut out parties from pursuing their claims and that, if the proceedings are dismissed, there may be room for argument that it will be too late to commence further proceedings for damages under s.82 of the Act. Further, particularly in relation to the allegations concerning the occupation of the shops, it seems to me that there may be another basis upon which the applicants could put their case. Even if no contravention was involved in the making of the statement, one arguably may have occurred by the respondent's subsequent failure to correcting it if it was known to be inaccurate, e.g. at the time the agreement for lease was entered into. Section 52 of the Act is concerned with conduct and is plainly not confined to statements. Section 4(2) of the Act expands conduct to include some inactivity: see sub-paragraphs (a) and (c). Reference has been made to this elsewhere: see, e.g. Leo v. Brambles Holdings Ltd (judgment delivered 6 August 1982, unreported). A comparable position exists in respect of misrepresentation at common law: see Cheshire and Fifoot's Law of Contract, 3rd Aust Ed., pp. 290-291.

Refusal of a Surrender of the Lease

The further statement made by Mr Campbell according to paragraph 6 of the applicants' affidavit, viz:

"If it becomes obvious you were having major troubles, it would be in our interest to let you out, or you could sell the value of the lease."

cannot bear the meaning attributed to it by paragraph 5(c) of the Statement of Claim which alleges that such words meant and were understood by the applicants to mean that a lessee having major troubles would be released from his lease.

I do not say that such a statement as Mr Campbell is alleged to have made could not constitute a contravention of s.52 of the Act. Whether it did or did not do so in any case would depend on all the circumstances, including a respondent's state of mind. Here, one might readily expect the respondents to acknowledge that, as sub-paragraph 12(b) (vii) of the Statement of Claim alleges, they had no intention "of releasing any tenant from the provisions of such a lease should the said tenant be unable to meet his commitments thereunder". If it be assumed in favour of the applicants that that be so and that the statement was made and further that a contravention thereby occurred, that is not sufficient for the applicants' present purposes. The only contraventions which are relevant in these proceedings are those which influenced the applicants. The relief claimed by the applicants is founded upon the steps which they allege they took in consequence of what they understood the statement to mean. The responsibility for any such misconception cannot be attributed to the respondents. The statement did not bear and could not have borne that meaning. See Taco Co of Australia Inc. v. Taco Bell Pty Ltd (1982) A.L.R. 177, 199 (35), 203 (10); Parkdale Custom Built Furniture Pty Ltd v. Puxu Pty Ltd [1982] HCA 44; (1982) 56 A.L.J.R. 715. It is, of course, not possible for the applicants to set up now a different case indicating that, but for the statement's true meaning, they would not have entered the transactions. The connection between any contravention of the Act and the conduct of the applicants has been sworn by them to be related to the meaning which they attributed to the statement. That meaning is so plainly untenable that, notwithstanding the general tendency of the courts not to summarily intervene to deny plaintiffs or applicants the trial of issues which they seek to have determined, this is an appropriate case in which to exercise that power in relation to the particular allegation now under consideration.

Inadequate Lifts

Another part of the applicants' case which should be similarly disposed of at this point concerns the lifts. The relevant statement alleged by the applicants, according to paragraph 6 of the Statement of Claim and paragraph 6 of their affidavit, was that made by Mr Goodfellow in answer to the female applicant's question "Why are there only three lifts?". Mr Goodfellow was said to have relevantly replied:

"Kern's idea is that people will get up to the first floor in the glass lift and they would have to walk all around the first level near all the shops and look for a way down."

According to paragraph 6 of the Statement of Claim, that statement meant and was understood by the applicants to mean "that the glass lift situated in the centre of the building would be adequate to move potential customers from the ground floor to the first floor of the shopping complex. . . ." In my opinion, it did not and could not bear that meaning. Indeed, the subject matter of Mr Goodfellow's statement seems to be removed from any question of the adequacy of the glass lift, let alone the adequacy of the lifts generally, which is made the subject matter of contention elsewhere in the Statement of Claim and the applicants' affidavit.

Nowhere in either the Statement of Claim or affidavit is there any reference to the state of mind of either respondent in relation to the glass lift or for that matter its adequacy or the adequacy of the lifts generally. Nowhere is it denied that it was Kern's idea that people would get up to the first floor in the glass lift and have to walk all around the first level near all the shops and look for a way down, or is any basis laid for calling in question in any respect the accuracy of what Mr Goodfellow said.

In the circumstances, to strike out the allegations in relation to the lifts would not only remove an oppression from the respondents but would be a mercy to the applicants. In order to escape the consequences of any mistake which they made in entering the lease and conducting a business in the shopping centre, the applicants need at least to be able to point to some contravention of the Act by the respondents which has the requisite connection with the course followed by the applicants and the loss which they suffered in consequence. The respondents are not liable to be sued for damages in these proceedings merely because, if such be the case, they erred in their commercial judgment in undertaking the shopping centre project in which the applicants leased a shop.

Leases with Different Terms and Rentals:

Any relationship between Mr Campbell's alleged statements in March or April 1979 that -

"(a) all tenants taking shops in the said shopping centre would be required to take a three year lease on the same terms;

(b) all ground level tenants would pay rental at the same rate per square foot and all first level tenants would pay rental at the same rate per square foot;"

and the applicants' decision to lease a shop is not easy to envisage. At first glance, it seems more likely that such statements might have influenced the terms upon which the applicants were prepared to lease from the respondents rather than their willingness to take a lease at all, and there is no suggestion, as yet, that the applicants' losses are related to some terms which they agreed to but could have avoided, save perhaps any reduction in rental which might have been negotiated. However, if the matter proceeds, these are questions for the trial.

Of more immediate relevance is the manner in which the applicants presently attempt to depend on Mr Campbell's statements as to lease terms and rentals. Paragraph 12(b) (i) of the Statement of Claim alleges that "the first and second Respondents at all material times were willing to enter into leases with retailers on terms substantially different from those required of the applicants . . ." There is nothing in the material to indicate that there was any discussion concerning different terms or rental prior to a conference which took place on 24 October 1979, such conference being after the agreement for lease was executed.

For the reasons discussed in relation to the walkway and the vacant shops, the applicants ought not be permitted to proceed with their claim based upon the alleged statements of Mr Campbell with respect to the terms of leases and rental as that claim is presently formulated, i.e. unless it is properly framed and particularised.

The Number of Customers at the Shopping Centre:

The applicants' position is, if anything, weaker in relation to the statements which they say were made to them concerning the number of people expected to attend the shopping centre. Mr Goodfellow is alleged to have said in August or September 1979:

"Kern did a feasibility study even before the building started. The number of people throughout Northtown is estimated to be between 30,000 and 50,000 per week."

Mr Lee is alleged to have said (quite possibly after both the agreement for lease and lease had been executed) that "they estimated they would turn over the population of Townsville twice in the first six weeks of the opening promotion". The nub of the applicants' case in relation to these alleged statements is their assertion that the respondents "had no reasonable expectation" that the number of persons passing through the shopping centre would approximate 30,000-50,000 per week or that the number of persons passing through the shopping centre in the first six weeks after opening would approximate twice the population of Townsville, which was then about 100,000 people. No basis is shown for that assertion other than the fact that the estimates proved excessively optimistic, according to the applicants. Once again, in my opinion, the applicants ought not be permitted to prosecute their claim in its present form.

Promotional Activities

A similar course of insisting upon a redefinition of adequate particularisation should be followed, in my opinion, in relation to the applicants' case insofar as it is based upon the statements allegedly made concerning proposed promotional activities. The allegation in paragraph 7(b) as to what was stated to the applicants with respect to promotional activities is sufficiently borne out for present purposes by paragraphs 6 and 13 of their affidavit. However, the allegation in paragraph 13(g) of the Statement of Claim that "no promotion of individual shops and their wares and merchandise has been conducted by the respondents or either of them" is not really supported. The general thrust of the applicants' case is that promotions have centred upon entertainment rather than individual shops and their wares and merchandise. The closest the affidavit gets to the substance of that allegation in the Statement of Claim is in paragraph 25 in which the applicants depose to the fact that there was no proper promotion of individual shops and their wares and merchandise. Any short-fall between the proof thus far adduced by the applicants and the allegations in their Statement of Claim in that respect would not justify the summary intervention of the court at this stage. However, on the other hand, I did not understand the applicants to suggest that they were entitled to succeed merely by showing that statements of the respondents' future intentions in relation to the promotion of individual shops and their wares and merchandise proved to be incorrect. Thus, sub-paragraph 12(b)(vi) of the Statement of Claim alleges that the respondents had no intention of doing as they had promised. No possible basis is shown for the making of that allegation by the applicants. Once again, the pleading must be put in proper order.

The Second Respondent

The matter has thus far been discussed without differentiation between the respondents. However, in my opinion, additional reason exists why the applicants should not be permitted to continue against the second respondent on the basis of the present formulation of their allegations. I consider that, as the matters stand, their allegations against the second respondent are plainly embarrassing.

It may well be that the applicants' motive for including the second respondent was to provide a basis for their claims to have the lease and Bill of Sale avoided or varied. To this point, the respondents have not submitted any such relief could not be granted. However, it is not easy to comprehend the perceived need for such claims. The applicants' affidavits suggest that the second respondent has re-entered under the lease and that the bill of sale has been enforced. Further, the term of the lease has expired. It is by no means unlikely that the conduct of the applicants after they must have known that they were misled (as they allege) would create a very real obstacle to relief other than damages and might well reduce the damages, if any, to which they are entitled. The material indicates that the applicants are still indebted to the second respondent for arrears of rent, but there is no reason why that cannot be taken into account like any other expenditure of the applicants in calculating their loss or damage if they succeed against the first respondent. Of course, they are entitled to proceed on a preferred course of attacking the lease and bill of sale and seeking damages against the second respondent also if they are able to show a basis for doing so. However, they are not entitled to include the second respondent in the proceedings merely because of some real or imagined forensic advantage or because of a desire for some additional relief for which they can show no basis.

Counsel for the applicants frankly acknowledged that the claim against the second respondent depended on making it responsible for the statements which the applicants allege were made, or on otherwise implicating it in the making of the statements. He disclaimed reliance upon any wider notion, such as, that the applicants might be entitled to avoidance or variation of their transactions with the second respondent if they could show that it took the assignment from the first respondent knowing what had occurred and perhaps knowing of the applicants' rights against the first respondent and with the intention of defeating those rights: cf. Jones v. Lipman (1962) 1 W.L.R. 832, Airlines Air Spares Ltd v. Handley Page Ltd (1970) Ch. 193.

I do not pause to consider whether it might be possible to plead a case against the second respondent; e.g. that it engaged in misleading or deceptive conduct or conduct likely to mislead or deceive because it knew of the statements which had been made, albeit some at least prior to its incorporation, that the applicants were relying on them, and also that they were incorrect, yet proceeded to deal with the applicants without disclosure of the true position; or that it somehow adopted the statements and thereby itself made them. Whether or not some such case or some different case under the Act is theoretically possible against the second respondent, no shadow of a case is presently raised against it. The applicants cannot, by vague and generalised allegations, in an attempt to lump first and second respondents together, circumvent their minimum obligation to plead an intelligent case against the second respondent separately.

The orders of the Court are:

1. The applicants' Statement of Claim filed on 15 October 1982, be struck out.

2. The applicants be refused leave to amend their Statement of Claim in accordance with the proposed Amended Statement of Claim handed up on 24 February 1983.

3. The applicants be at liberty to bring on an Application for leave to deliver an Amended Statement of Claim at 9 a.m. on Friday 25 March 1983.

4. The respondents' motion filed herein on 22 February 1983 and the directions hearing in these proceedings be adjourned to 9 a.m. on Friday 25 March 1983.

5. The applicants pay to the respondents the taxed costs of and incidental to all interlocutory proceedings herein to date.