Walter Construction Group Ltd v Thiess Pty Limited [2005] FCA 190 (8 February 2005)

WALTER CONSTRUCTION GROUP LTD ('ADMINISTRATOR APPOINTED')
(ABN 78 008 390 074) v THIESS PTY LIMITED (ABN 87 010 221 486) AND HOCHTIEF AG (ARBN 101 525 651)
NSD 667 OF 2004

GYLES J
8 FEBRUARY 2005
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 667 OF 2004

BETWEEN:	WALTER CONSTRUCTION GROUP LTD ('ADMINISTRATOR APPOINTED') (ABN 78 008 390 074) APPLICANT
AND:	THIESS PTY LIMITED (ABN 87 010 221 486) FIRST RESPONDENT HOCHTIEF AG (ARBN 101 525 651) SECOND RESPONDENT
JUDGE:	GYLES J
DATE OF ORDER:	8 FEBRUARY 2005
WHERE MADE:	SYDNEY

The proceeding stand over.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 667 OF 2004

BETWEEN:	WALTER CONSTRUCTION GROUP LTD ('ADMINISTRATOR APPOINTED') (ABN 78 008 390 074) APPLICANT
AND:	THIESS PTY LIMITED (ABN 87 010 221 486) FIRST RESPONDENT HOCHTIEF AG (ARBN 101 525 651) SECOND RESPONDENT

JUDGE:	GYLES J
DATE:	8 FEBRUARY 2005
PLACE:	SYDNEY

1 I have decided that the issues should be split, although, in a somewhat different way to that proposed. The issues arising from paragraphs 1 to 68 inclusive, 77 and 79, will be decided in advance of other issues. Although this is an interlocutory proceeding, it has considerable practical consequences and there are substantial arguments either way. I need not recite the nature of the case, which sufficiently appears from the pleadings, or the evidence, which has been read without objection.

2 I have had the benefit of submissions which have reviewed the authorities and counsel have stressed the relevant arguments on both sides. I have been pressed, in particular, on behalf of the respondent, by the reservations about split issues expressed by some High Court justices. Nonetheless, the discretion conferred upon the Court by O 29 r 2 of the Federal Court Rules (the Rules) is unfettered. I will mention those matters which have particularly weighed upon my mind in making the decision that I have.

3 If the application succeeds, as it has, this will, it seems to me, result in a substantial but manageable case, the hearing of which will be measured in weeks. Much of the preparation for such a case has already taken place. That case could be heard later this year. It will be the end of the matter if the applicant fails on those issues, subject to appeal. If the applicant succeeds, then the case will proceed to consideration of relief on the basis of findings which will by then have been made, rather than on the basis of all possible hypothetical combinations and permutations in relation to liability. All that is well and good but, as has been pointed out, there is a risk that this will prove to have been a waste of money and a hypothetical exercise if, in the end, no substantial loss is proved. Furthermore, there is a risk of overlap of evidence with what counsel for the respondent has described as Spedley consequences. On the other hand, if the application to split fails, then the parties and the Court are confronted with a very large case, with significant management problems. The hearing of such a case would be measured in months rather than weeks and the preparation for it on either side will be both lengthy and costly.

4 It seems to me that the proper course is to split the issues as I have indicated. I have put to one side the fact that the applicant has recently been placed in administration. I can see that that may tend one way or another, depending upon which way one looks at it, and I think the safer course is, having noted it, to put it to one side as a deciding factor.

5 I should indicate why I have favoured a split somewhat different to that proposed by the applicants. It seems to me that to endeavour to distinguish between various aspects of relief is both difficult of definition and difficult to manage. Furthermore, it would involve preparation against a number of possibilities. In my view, it is better to deal with the issues that may broadly be termed ‘liability issues’, before any question of monetary or other relief arises. In my opinion, O 29 r 2 of the Rules is not limited to a decision about causes of action and I am satisfied that the issues that arise on the paragraphs that I have identified, would dispose of all of the matters that need to be disposed of prior to coming to the question of relief.

6 I do not propose to make formal orders today. There are some outstanding issues which may need to be decided and the applicant has asked for the matter to be stood over for a time to enable stock to be taken of the position, and I reserve costs and any decision about costs until that time.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles.

Counsel for the Applicant:	MA Pembroke SC, SA Kerr

Solicitor for the Applicant:	Mallesons Stephen Jaques

Counsel for the Respondent:	SF Finch SC, M Dempsey SC

Solicitor for the Respondent:	Allens Arthur Robinson

Date of Hearing:	8 February 2005

Date of Judgment:	8 February 2005

Federal Court of Australia

Walter Construction Group Ltd v Thiess Pty Limited [2005] FCA 190 (8 February 2005)