Practice and procedure - Application to strike out paragraphs of statement of claim - Turns on own facts

Fair Trading Act 1987 (WA), s 11

Alpine Holdings Pty Ltd & Ors v Feinauer [2006] WASC 80

D'Orta-Ekenaike v Victorian Legal Aid [2005] HCA 12; (2005) 223 CLR 1

Giannarelli v Wraith [1988] HCA 52; (1988) 165 CLR 543

Gray v Morris [2004] QCA 5

Sheridan International Pty Ltd v CS Brooks Inc [2005] NSWSC 140

1 MASTER SANDERSON: This is the defendant's application to strike out pars 35 to 44 and 62 to 78 of the plaintiffs' re-amended statement of claim. The re-amended statement of claim was served after certain paragraphs of the amended statement of claim were struck out on the grounds that advocate's immunity applied to the allegations made in those paragraphs: see Alpine Holdings Pty Ltd & Ors v Feinauer [2006] WASC 80.

2 The paragraphs of the amended statement of claim that were struck out pleaded claims in contract and tort for negligence or breach of fiduciary duty in respect of the First Retainer and the Second Retainer. The First Retainer was identified in par 9 of the amended statement of claim and concerned the conduct of the plaintiffs' action, including the trial, against Warwick Entertainment Centre and others (the "Warwick action"). The paragraphs that were struck out were pars 30, 30A, 31, 31A, 31B, 31C, 32 and 33.

3 The Second Retainer was identified at par 39. It concerned the conduct of appeals from the Warwick action. The paragraphs that were struck out were pars 49, 49A, 51 and 52.

4 The re-amended statement of claim pleads the First Retainer (par 11) and the Second Retainer (par 50) in precisely the same terms as in the amended statement of claim.

5 The allegations that were struck out and on which the claims relating to the First Retainer were founded were that the defendant had failed to advise on and fully plead the plaintiffs' loss and damage in the Warwick action.

6 Paragraphs 35 to 44 of the re-amended statement of claim seek to introduce a claim for contravention of s 11 of the Fair Trading Act 1987 (WA) in respect of the First Retainer. The claim remains that the defendant failed to properly advise on and plead the plaintiffs' loss and damage in the Warwick action. In par 35, reference is made to the engagement of an accountant who was to prepare a report on the loss and damage sustained by the plaintiffs and which they sought to recover in the Warwick action. It is misleading and deceptive conduct in relation to this report which is said to found the cause of action. But, properly considered, what is being put is that the defendant failed to properly plead and pursue the plaintiffs' claims. The difference between the paragraphs struck out and the paragraphs found in the re-amended statement of claim is a claim based on the Fair Trading Act rather than a breach of duty in contract and tort. So the question then is whether advocate's immunity will apply to a statutory cause of action as against a cause of action founded in common law.

7 Advocate's immunity reflects a "central and pervading tenet of the judicial system" that controversies, once resolved, are not to be re-opened: see D'Orta-Ekenaike v Victorian Legal Aid [2005] HCA 12; (2005) 223 CLR 1 per Gleeson CJ, Gummow, Hayne and Heydon JJ at 17, 20 and 30 - 31. Although the High Court in D'Orta-Ekenaike was expressly dealing with a subsequent claim in negligence, the majority made clear the immunity applies to a subsequent suit or otherwise: see Gleeson CJ et al at 85. There can be no basis for confining the immunity to a subsequent claim at common law. The policy of finality would be subverted if a matter could be re-litigated under the guise of a statutory right where the immunity would otherwise preclude a claim at common law or in equity. Subsequent to D'Orta-Ekenaike, there is no rational basis for drawing such a distinction.

8 Counsel for the plaintiffs referred to two cases which, it was submitted, establish that the question of advocate's immunity where a statutory cause of action is pleaded, is yet to be determined. These two cases were Sheridan International Pty Ltd v CS Brooks Inc [2005] NSWSC 140 and Gray v Morris [2004] QCA 5. In my view, whatever may be the proper interpretation of these two cases, they cannot stand when put against the clear reasoning of the majority in D'Orta-Ekenaike.

9 D'Orta-Ekenaike also reaffirmed the extent of the immunity. It is to be determined according to the test in Giannarelli v Wraith [1988] HCA 52; (1988) 165 CLR 543. The effect of that decision is that work done out of court leading to a decision affecting the conduct of the case in court is covered by the advocate's immunity. What is complained of in pars 35 to 44 may be work that was undertaken out of court. But it led to a decision affecting the conduct of the case in court and is covered by the advocate's immunity.

10 The same reasoning applies to pars 62 to 78. Again, what is complained of is an action framed in misleading and deceptive conduct. But what is complained of is that the defendant failed to properly advise the plaintiffs about errors of law in the trial Judge's award of damages, the conduct of the appeal and the possible compromise of the Warwick action and the appeal. Consistent with what I have said above, advocate's immunity applies to those allegations and the paragraphs cannot stand.

11 For these reasons, I would strike out the paragraphs complained of. There is a question as to whether or not further leave to replead ought be given. It would seem now there is little utility in giving the plaintiffs another chance to plead their case. However, this was not an issue which was argued before me and therefore I will hear the parties further on this question and as to costs.