Bank of Western Australia Ltd v Tannous

cond Defendant) No appearance (Third Defendant) Henry Davis York (Plaintiff) Donnelly Lawyers (First Defendant) Good Legal Lawyers (Second Defendant) Gadens Lawyers (ING and Firstfolio Mortgages Australia Pty Ltd) Solicitor for the Registrar General File Number(s): 2009/292096 Decision under appeal Citation: Bank of Western Australia Ltd v Tannous [2012] NSWSC 559 Date of Decision: 2012-05-29 00:00:00 Before: Harrison AsJ File Number(s): 2009/292096

Judgment 1This judgment concerns three Notices of Motion. The first is an appeal by First Folio Mortgages Australia Pty Ltd (FMA) by way of Notice of Motion from a judgment of Harrison AsJ: Bank of Western Australia Ltd v Tannous [2012] NSWSC 559. The second Notice of Motion by Mrs Tannous seeks an order under r 36.15, alternatively r 36.17 UCPR setting aside the judgment in favour of FMA which I gave on 3 December 2010 (Bank of Western Australia Ltd v Tannous [2010] NSWSC 1319) and in lieu providing that the First Cross-Claim of the Second Defendant filed 11 August 2009 be dismissed, alternatively struck out. 2The third Notice of Motion by FMA filed 16 October 2012 seeks orders that the Amended Fourth Cross-Claim be dismissed pursuant to r 13.4 UCPR, alternatively struck out in its entirety or in part pursuant to r 14.28 UCPR.

3The Bank of Western Australia has brought proceedings claiming possession of land at 30 Rixons Pass Road, Woonona against Arthur and Emily Tannous arising out of loan agreements said to have been entered into between them and the Bank in December 2006. The Defendants defend the proceedings on the basis that the loan agreements were fraudulently entered into, alternatively, that the contracts were unjust under both the Contracts Review Act 1980 and the Consumer Credit Code. 4The Defendants are the elderly parents of Michael Tannous. Emily Tannous has very limited English and neither she nor Arthur Tannous is educated beyond a very basic level. 5They allege that some of the loan documents have been forged. Emily Tannous says that a prior loan agreement and mortgage in 2005 to FMA as trustee for ING Bank (Australia) Ltd were forged. In respect of the BankWest loan she agrees that she signed the mortgage to BankWest but says that her signature on the two loan agreements was forged. 6Affidavits have been sworn by their son Michael Tannous where he admits to having forged his parents' signatures, and otherwise to have persuaded them to enter into various transactions by misrepresenting those transactions to them. In those Affidavits he admits that the prior transaction with FMA was also obtained in similar circumstances. 7When the loans were obtained from BankWest, BankWest paid out the FMA loan in full on about 20 March 2007 and that resulted in the mortgage in favour of FMA being discharged and replaced by the present mortgage to BankWest. 8After the present proceedings were served on the Defendants not only did they file Defences but they filed 3 Cross-Claims against (inter alia) ING Bank and FMA.

The First Cross-Claim 9Emily Tannous filed a first cross-claim against FMA. In that cross-claim she recited that she had not at any time executed any loan agreements or mortgages with FMA and that a person or persons unknown purported to act on her behalf to do so. The Cross-Claim pleaded that FMA had not advanced any monies to her nor at her direction. The thrust of the pleading against ING and FMA was that the loan made by FMA and the mortgage securing the loan over the Defendants' property were not authorised by the Defendants, were fraudulent, and if signed by them as a result of misrepresentations, ought to be set aside under the Contracts Review Act. 10In the relief claimed, orders were also sought that ING and FMA should indemnify the Defendants for all monies that they (ING and FMA) received from BankWest less an amount of $30,000 being an existing liability that the Defendants had to a company called Fiduciary Services Australia Pty Ltd at the time of the FMA loan. 11The cross-claim sought these declarations:

1. A declaration that Emily had not executed any mortgages or loan agreements in favour of FMA;
2. A declaration that all mortgages and loan agreements were void as against her and were of no effect;
3. A declaration that the debt created by the loan agreements and mortgage was not personally due and payable by her;
4. An order that FMA indemnify her including with the return of any monies pursuant to the charges or mortgages except for an amount of $30,000 for which she had had liability to a prior mortgagee. 12She brought a Second Cross-Claim against ING who was the funder of the loan. That cross-claim is not currently relevant. 13Her husband Arthur Tannous also brought a cross-claim against FMA (the Third Cross-Claim) in the same terms as that brought by Emily Tannous. That cross-claim is not currently relevant. 14In relation to the three cross-claims I determined as follows: [43] Where there is an issue about the unjustness of a contract or mortgage paid out by an incoming mortgagee who is the Plaintiff in proceedings, the issue is not determined by joining that prior mortgagee as a party to the proceedings. Rather, the issue is determined in the context of the discretionary order at the second stage of the Contracts Review Act proceedings. That is so, because the issue forms part of the controversy between the Plaintiff and the Defendants. The justiciable issue is what order should be made in circumstances where the contract made between the Plaintiff and the Defendants is held to be unjust. There is no justiciable issue between the Defendants and the mortgagee/lender whose contract has been completed and whose mortgage has been discharged. ... [45] The problem with the claims made by the Defendants against FMA are not matters of pleading. They are matters of substance. There is no claim, and can be no claim, against FMA arising out of the facts pleaded. Again, the matter easily satisfies the test in General Steel Industries. 15As a result I made the following orders: (1) Judgment for the Second Cross-Defendant on the First Cross-Claim dated 11 August 2009. (2) Judgment for the First Cross-Defendant on the Second Cross-Claim dated 1 July 2010. (3) Judgment for the Second and Third Cross-Defendants on the Third Cross-Claim (wrongly entitled First Cross-Claim) dated 1 July 2010. 16On 23 August 2011 I gave leave to the Plaintiff to amend its Statement of Claim. I did so because the Second Defendant consented to the amendment. That Amended Statement of Claim, in the alternative to seeking possession and the money due under the loan agreements, sought restitution from the Defendants in the amount that BankWest paid to FMA to discharge FMA's mortgage. This claim was based upon what was contained in the evidence served by the Defendants to the effect that the Second Defendant's signatures were forged on all of the FMA documents. BankWest alleged that if that evidence was accepted it was entitled to recover the monies it paid to discharge the FMA mortgages as money had and received to the use of the First and Second Defendants.

The Fourth Cross-Claim 17On 13 December 2011 the Registrar directed that the First and Second Defendants file and serve their defence to the Amended Statement of Claim and any cross-claim by 13 January 2012. On 13 January 2012 the Second Defendant filed the Fourth Cross-Claim. 18The Fourth Cross-Claim recited that the Second Defendant had not signed any documents with FMA but that at the time of the obtaining of the loan from BankWest FMA made representations to BankWest that the Second Defendant had signed the loan agreement and mortgage with FMA and had borrowed the monies from it. It was alleged that the purpose of making those representations was to induce BankWest to pay monies said to be due to FMA pursuant to the loan agreement and the mortgage purportedly made with the Second Defendant. 19The Second Defendant alleged that as a result of the misleading and deceptive conduct, being the representations, she had suffered loss and damage being the amount now sought by BankWest against her. 20The cross-claim then sought declarations that the loan agreement and mortgage purportedly made between FMA and the Second Defendant were void and of no effect, a declaration that no monies were payable by the Second Defendant pursuant to the loan agreement and mortgage with FMA, and a declaration that the purported directions to BankWest as to payment to discharge the FMA mortgage were void and of no effect. An order was sought that the contract, (presumably the loan agreement and mortgage, although that is not clear), be set aside or varied pursuant to s 87 Trade Practices Act 1974 (Cth) or s 72 Fair Trading Act 1987. Damages were also sought. 21On 30 April 2012 FMA filed a Notice of Motion to dismiss the Fourth Cross-Claim, alternatively to strike it out, alternatively that it be permanently stayed. 22The Motion was heard by Harrison AsJ on 13 May 2012. 23FMA argued before Harrison AsJ first, that there was an Anshun estoppel arising from the filing of the First Cross-Claim (where the matters now raised in the Fourth Cross-Claim of misleading and deceptive conduct were omitted) and the judgment in favour of FMA which I entered on 3 December 2010. 24Secondly, FMA submitted that the judgment of 3 December 2010 was a final and binding determination, and that the Fourth Cross-Claim constituted an abuse of process. 25Thirdly, FMA submitted that the claim made in the Fourth Cross-Claim for misleading and deceptive conduct was doomed to fail. 26Judgment was given on 29 May 2012: Bank of Western Australia Ltd v Tannous [2012] NSWSC 559. 27Harrison AsJ, although finding at [34] that the Fourth Cross-Claim did not plead any new facts or transactions that were not contained in the First Cross-Claim held nevertheless that there was no Anshun estoppel because at the time the First Cross-Claim was filed BankWest had not pleaded the restitution claim against the Defendants. In those circumstances Harrison AsJ held at [55] that it was not unreasonable for the Second Defendant not to plead false and misleading conduct against FMA in the earlier Cross-Claim because she could not have anticipated the change in pleading by the Plaintiff. 28Harrison AsJ rejected the claim of abuse of process because there had been no claim for relief under the Trade Practices Act or the Fair Trading Act in the earlier Cross-Claim. A finding in the Second Defendant's favour on such claims would not, her Honour held, be inconsistent with the judgment of 3 December 2010. 29In relation to whether the claim was doomed to fail her Honour found only that the pleading was unsatisfactory, particularly because a concession was made by Senior Counsel for the Second Defendant that the case needed to be repleaded. Accordingly her Honour said at [66]: ... It is my view that because Mrs Tannous may lose at least her share of the matrimonial home in circumstances where it appears she was deceived at least by family members, she should have only this one further opportunity to replead the cross claim.

The Amended Fourth Cross-Claim 30On 12 June 2012 the Second Defendant filed an Amended Fourth Cross-Claim (hereafter referred to as "the Cross-Claim"). 31In Section 1 of the Cross-Claim the claim by BankWest against the Second Defendant for the amount it paid to FMA to discharge its mortgage is set out followed by the claim of the Second Defendant to be indemnified by FMA in whole or in part against any liability she might be held to have to BankWest. 32Section 2 details the FMA mortgage and loan agreement and that they were not signed by the Second Defendant. Section 3 of the Cross-Claim recites the discharge of the FMA mortgage without the knowledge or authority of either the First or Second Defendant, and that the authority to pay out and discharge the mortgage given by FMA to BankWest was not signed by either of Mr and Mrs Tannous. 33Section 4 of the Cross-Claim alleges breaches of obligations under s 912A(1)(a) Corporations Act 2001 (Cth) to ensure that any financial services provided by FMA were provided in a manner that was efficient, honest and fair. 34Section 5 of the Cross-Claim sets out what were said to be representations made by FMA to BankWest in February and March 2007 which resulted in the Plaintiff paying the sum of $571,171.26 to FMA to discharge its mortgage. These representations include that FMA had made a home loan to Mr and Mrs Tannous, that they had signed a mortgage with FMA and were liable to FMA to pay the monies in the loan agreement as secured by the mortgage. Those representations are said to be misleading and deceptive on the basis that FMA had no such arrangement with Mr and Mrs Tannous. The pleading goes further and alleges that the representations were false. The loss and damage said to have been suffered by the Second Defendant is the amount being claimed by BankWest on the restitutionary claim of $571,171.26. 35Section 6 of the Amended Cross-Claim pleads statutory unconscionability on the part of FMA. This is said to arise because of the disadvantageous position the Second Defendant was in by reason of her education and limitations in the English language. In that way it is said that she could not read or understand the FMA loan agreement and mortgage. Quite why that is relevant is not clear when the principal allegation is that she did not sign the agreements and had no knowledge of them. 36Section 7 is headed "Responses to FMA's reliance on the Real Property Act 1900 (NSW) Section 42". It claims that as a result of the claim made by the Plaintiff for restitution the Second Defendant is entitled to seek relief against FMA under the Contracts Review Act. In aid of that claim she pleads the provisions of s 36(11) of the Real Property Act 1900 as well as ss 19 and 7 of the Contracts Review Act which together are said to entitle a claim for relief under that Act. Section 19 is pleaded to overcome a perceived difficulty that on discharge of the FMA mortgage that mortgage ceased to be a "land instrument" registered under the Real Property Act within the meaning of s 19. 37This section of the Cross-Claim also pleads that FMA is guilty of Real Property Act fraud and that the Second Defendant is entitled to enforce personal equities notwithstanding the registration of the FMA mortgage. 38The relief claimed in the Cross-Claim is an order that FMA pay to the Second Defendant compensation in an amount calculated to save her harmless from the whole of the claims made against her, the First Defendant and the property by the Plaintiff in the principal proceedings. Such an order is sought under ss 82 and 87 Trade Practices Act, ss 12GF and 12GM of the Australian Securities and Investment Commission Act (Cth) 2001, ss 68 and 72 of the Fair Trading Act and ss 7 and 8 of the Contracts Review Act, or in the general equitable jurisdiction of the Court. 39The Cross-Claim also seeks such further or other relief as the nature of the case might require including orders setting aside so much of my judgment of 3 December 2010 that would preclude the relief earlier being sought in the Cross-Claim.

Consideration of the Motions 40It seems to me that the most appropriate way to proceed is first to determine the motion by FMA that appeals from the judgment of Harrison AsJ. If the appeal is upheld so that the Second Defendant is thereby precluded from proceeding with the Fourth Cross-Claim it is then appropriate to deal with the motion by the Second Defendant to vary the judgment that I gave on 3 December 2010. Finally, if the appeal from Harrison AsJ is not upheld, or if the judgment that I gave on 3 December 2010 is varied it will then be necessary to consider FMA's Notice of Motion of 16 October 2012 which seeks that the Amended Fourth Cross-Claim be dismissed, alternatively, struck out.

(1) FMA's Motion - appeal from Harrison AsJ 41FMA submitted that at the time Harrison AsJ delivered judgment allowing the Fourth Cross-Claim there was an extant binding judgment, being my judgment of 3 December 2010, by which the parties' rights identified in the First Cross-Claim had been merged. 42FMA also submitted that there was no relationship between the new claim made by the Plaintiff for restitution and the cause of action based on misleading and deceptive conduct pleaded by the Second Defendant. FMA further submitted that even if the order I had made was an order dismissing the First Cross-Claim the present application in the Fourth Cross-Claim would be prevented by Anshun and would be an abuse of process because it would be seeking to re-litigate an issue already resolved adversely to the Second Defendant. FMA drew particular attention to the finding by the Associate Justice that the Fourth Cross-Claim did not plead any new facts or transactions that were not contained in the First Cross-Claim. FMA submitted, therefore, that the judgment given in December 2010 prevented another legal gloss or construct on the same facts represented here by the claim for misleading and deceptive conduct. 43The first enquiry must be the nature of the judgment which I gave on 3 December 2010. Although the Associate Justice noted the Second Defendant's submission that the judgment was interlocutory she made no finding in that regard. 44Although I found in the December 2010 judgment at [45] that the problems with the Second Defendant's claims were ones of substance and not pleading that finding did not determine whether the judgment was final or interlocutory. Contrary to FMA's submissions both before the Associate Justice and on the appeal, a long line of authority establishes that the judgment I entered was an interlocutory one: Re Luck [2003] HCA 70; (2003) 203 ALR 1 at [6] -[10]; Wickstead v Browne (1992) 30 NSWLR 1 at 11. 45Moreover, r 13.4 UCPR, upon which FMA moved in 2010, permitted the Court to make an order "that the proceedings be dismissed generally". If the earlier Cross-Claims had been dismissed generally the Second Defendant would have been able to bring "fresh proceedings" unless there had been a hearing on the merits by virtue of s 91 Civil Procedure Act 2005. There was no hearing on the merits leading to the 2010 judgment. As a result of what has now been submitted by the Second Defendant I accept that it would have helped to clarify the nature of the outcome if I had ordered that the earlier Cross-Claims be dismissed. I shall return to this matter presently. 46Accordingly, the Associate Justice could have found that because my judgment was interlocutory the bringing of the Fourth Cross-Claim was not an abuse of process: Nominal Defendant v Manning [2000] NSWCA 80; (2000) 50 NSWLR 139 at [71]-[72] and [122]-[124] (noting the doubt expressed by Allsop P in Fletcher v Besser [2010] NSWCA 30 at [2] about the authority of Manning). However, her Honour's conclusion that there was no abuse of process, although for other reasons, was correct. 47Since the judgment I gave was interlocutory the Anshun principle is not engaged: Welker v Rinehart (No 6) [2012] NSWSC 160 at [15] to [18]; D A Christie Pty Ltd v Baker (1996) 2 VR 582 at 602 (this aspect of the decision not disapproved in Manning); Newmont Yandal Operations Pty Ltd v The J Aron Corporation and the Goldmman Sachs Group Inc [2007] NSWCA 195; (2007) 70 NSWLR 411 at [181], [197] - [202]. Nevertheless, similar considerations may apply to an interlocutory application. In a case where there has been a contested interlocutory hearing the ordinary rule is that there would need to be a material change of circumstance to set aside, vary or discharge the earlier order: Brimaud v Honeysett Instant Print Pty Ltd (1988) 217 ALR 44 at 46. 48It may be accepted that the Fourth Cross-Claim did not plead any facts additional to those contained in the First cross-Claim, as Harrison AsJ found, but the fresh pleading and cause of action contained in the Amended Statement of Claim cannot be ignored. 49In my opinion the new claim pleaded in the Amended Statement of Claim of payment by BankWest to FMA under the mistaken belief that that the FMA loan agreements and mortgage were valid and enforceable was a material change of circumstances justifying leave for the filing of a further cross-claim at least for a cause of action based upon alleged misleading and deceptive conduct by FMA. Until BankWest pleaded that it paid the money to FMA on the mistaken belief that the FMA loan agreements and mortgage were valid and enforceable, it is difficult to see what basis the Second Defendant had to plead any cause of action against FMA based upon FMA's misleading an deceptive conduct. Whether any other causes of action should be allowed will be considered later in this judgment. 50Similarly, if the principle in Anshun was engaged, the Associate Justice's conclusion, that it was not unreasonable for the Second Defendant not to have pleaded misleading and deceptive conduct against FMA in the earlier Cross-Claim, was correct. 51Accordingly, the appeal from the judgment of the Associate Justice fails.

(2) Should the December judgment be varied? 52These conclusions might be thought to make unnecessary any change to the form of the orders I made on 3 December 2010. However, for the reasons which follow I consider that the orders I made should be varied in the manner that will be identified. 53The Second Defendant relies on r 36.15 or r 36.17 UCPR to say that the order I made on 3 December 2010 should be varied so that the order made in respect of the First Cross-Claim was either an order that it should be dismissed or that it should be struck out. Alternatively, the Second Defendant relies on the inherent jurisdiction of the Court. 54Rule 36.15 enables a Court to set aside an order if it was made irregularly, illegally or against good faith. For the reasons which I discussed in Zakaria v Dr Noyce [2012] NSWSC 981 at [20]-[22] the December judgment was not given against good faith. There is no suggestion of illegality. The only question is whether the judgment was given irregularly. A denial of procedural fairness will be an irregularity that falls within the rule and, in any event, entitles the person as a matter of unconditional right to have it set aside: Miltonbrook Pty Ltd v Westbury Holdings Kiama Pty Ltd [2008] NSWCA 38; (2008) 71 NSWLR 262 at [85]; Cameron v Cole (1944) 68 CLR 571. 55The Second Defendant submitted that a clear distinction is made in ss 90 and 91 CPA between a judgment and a dismissal. Those sections relevantly provide: 90 Judgments generally (1) The court is, at or after trial or otherwise as the nature of the case requires, to give such judgment or make such order as the nature of the case requires. ... 91 Effect of dismissal of proceedings (1) Dismissal of: (a) any proceedings, either generally or in relation to any cause of action, or (b) the whole or any part of a claim for relief in any proceedings, does not, subject to the terms on which any order for dismissal was made, prevent the plaintiff from bringing fresh proceedings or claiming the same relief in fresh proceedings. (2) Despite subsection (1), if, following a determination on the merits in any proceedings, the court dismisses the proceedings, or any claim for relief in the proceedings, the plaintiff is not entitled to claim any relief in respect of the same cause of action in any subsequent proceedings commenced in that or any other court. 56The application made by FMA which resulted in the December judgment was an application under r 13.4 UCPR on the basis that no reasonable cause of action was disclosed. That rule (as noted above) provides that if it appears to the Court that no reasonable cause of action is disclosed: the court may order that the proceedings be dismissed generally or in relation to that claim. 57In Re Luck [2003] HCA 70; (2003) 203 ALR 1 the High Court affirmed the English cases which had held that an order striking out a claim on the grounds that it disclosed no cause of action was interlocutory in nature, at least for the purposes of an appeal. 58At the time I directed entry of the December judgment my attention had not been drawn either to ss 90 and 91 nor to the decision in Re Luck. I accept, however, that the Notice of Motion brought by FMA which resulted in my judgment did not seek a judgment in FMA's favour on the First Cross-Claim but sought only that the cross-claim be dismissed. 59The transcript of the hearing of the Notice of Motion before me discloses that I sought to ascertain from counsel appearing for the Second Defendant (and for the solicitor for the First Defendant) what rights they said their clients had against FMA. I sought to do that partly because of a statement made by counsel for FMA in the course of his submissions that BankWest might suggest at some stage that there was a misrepresentation arising out of the discharge figures provided to BankWest by FMA. It was the failure of the legal representatives of the First and Second Defendants to identify a basis for their claim contained in their cross-claims against FMA that I determined that the difficulties with the claims made were not matters of pleading but matters of substance. It was that conclusion which resulted in the judgment in favour of FMA. 60In the light of what has now been put to me concerning ss 90 and 91 CPA, r 13.4 UCPR and the High Court's judgment in Re Luck I consider that I was in error in entering a judgment in favour of FMA. This can be corrected either on the basis that the judgment was entered irregularly (r 36.16) because only dismissal was sought by FMA: Miltonbrook Pty Ltd v Westbury Holdings Kiama Pty Ltd [2008] NSWCA 38; (2008) 71 NSWLR 262, or under the slip rule (r 36.17): Newmont. The entry of judgment, although interlocutory as Re Luck makes clear, had unintended consequences demonstrated by the issue debated before the Associate Justice and before me on this appeal. Those unintended consequences, particularly for any other rights the Second Defendant may have, justify the invocation of the slip rule: Newmont at [41], [58], [60], [89] and [116]. 61Accordingly, the order I made (the entry of judgment) should be recalled and corrected so that it provides for the dismissal of the First Cross-Claim. 62FMA submits that as a matter of discretion such an order ought not to be made because of the delay by the Second Defendant in seeking to vary the judgment. It is true that nothing was done either to appeal against the December judgment nor to apply to vary it for a period of some 18 months after it was entered. However, it was not until 29 August 2011 that the Plaintiff filed its Amended Statement of Claim adding the restitution claim. The period which needs to be considered is, therefore, the period from 29 August 2011 until July 2012 when the Second Defendant's Notice of Motion was filed. 63The only prejudice that FMA could point to in that time was the fact that it brought the Notice of Motion which was heard by Harrison AsJ. To the extent that any order I now make varying the December judgment made that procedure unnecessary the prejudice can be dealt with by an appropriate costs order. However, FMA argued its Motion before Harrison AsJ not simply on the basis that there was a judgment of this Court in its favour and against the Second Defendant. It argued also that even if there had been a dismissal of the First Cross-Claim principles of Anshun and abuse of process would have meant that the Second Defendant should not be allowed to maintain the Fourth Cross-Claim. Further, argument was addressed before Harrison AsJ on the form of the Fourth Cross-Claim. 64The significant matter is that even if the position remains as it now is, with a judgment in favour of FMA, the judgment is only an interlocutory one. There will be no change in substance to the rights or liabilities of the parties by making a change which more particularly follows the wording of r 13.4. That correct wording, that the earlier Cross-Claims should be dismissed, will remove any further confusion concerning those rights and liabilities.

(3) The form of the Cross-Claim 65The cross-claim that was before the Associate Justice was the Fourth Cross-Claim filed 13 January 2012. I have summarised its provisions in paragraphs 18 to 20 above. As part of the claim of misleading and deceptive conduct reliance was also placed on what were said to be representations derived from s 912A Corporations Act. 66At the conclusions of her judgment the Associate Justice said at [66]: The last matter raised by Firstfolio is that, as a matter of pleading, the fourth cross claim at [11]-[13], [15] and [22] contains diffuse allegations, which fail to comply with the requirement for "a clear identification of the conduct said to be misleading or deceptive" nor does it state that the material facts establishing the necessary casual link should be pleaded. At the outset of this hearing senior counsel for Mrs Tannous foreshadowed that the case pleaded against Firstfolio in the fourth cross claim was defective in a matter of form and has sought leave to replead it. It is my view that because Mrs Tannous may lose at least her share of the matrimonial home in circumstances where it appears she was deceived at least by family members, she should have only this one further opportunity to replead the cross claim. She granted leave to file an amended fourth cross-claim within 14 days. 67The Amended Fourth Cross-Claim filed on 12 June 2012 pleaded the matters which I have summarised in paragraphs 31 to 39 above. As can be seen the claims go well beyond the cross-claim for which leave was given to re-plead. I will return to this matter later in the judgment. 68In Manning Heydon JA said at [72]: [72] Nothing in the above reasoning rejecting the Nominal Defendant's submission is intended to encourage litigants to avoid putting their best cases forward in any interlocutory application. The deliberate non-tender of evidence for use in a second interlocutory application should the first fail, or for use in an interlocutory appeal from the interlocutory application, might of itself be fatal to success; and even the non-deliberate non-deliberate failure to tender evidence is extremely risky. The Nominal Defendant's proposition that no second interlocutory application can be entertained unless there is a change of circumstances or unless evidence is relied on which could not reasonably have been obtained earlier is too extreme, but a litigant bringing a second application where circumstances have not changed on evidence available earlier is facing serious and self-created risks of an adverse exercise of judicial discretion. The real evils to which Hayne JA referred in D A Christie Pty Ltd v Baker [1996] 2 VR 582 at 602-603 - the risk of conflicting decisions, the unnecessary vexing of respondents, judge-shopping and the diminution of certainty in the conduct by respondents of their affairs - and others - damaging public confidence in the integrity of judicial decisions, expending time and money on litigation unnecessarily - are evils which each court in its individual discretion will rightly strain to avoid. [73] But the risk of the evils must be balanced against all the circumstances of the case relevant to whether it is fair and just that leave should be granted, and in particular whether a trial which is just and fair for all parties can be held. 69I have already determined that the cause of action for misleading and deceptive conduct should be permitted to be included in any further cross-claim. That is because the basis for it has been laid in the Amended Statement of Claim by the assertion that the Plaintiff paid money to FMA under a mistaken belief in the validity and enforceability of the FMA mortgage and loan documents. While it was always the Second Defendant's position that the FMA mortgage and loan agreements were not valid and enforceable, absent the Plaintiff's payment in the mistaken belief of their validity and enforceability, the Second Defendant had no proper reason for asserting the causal connection between that invalidity and what was being claimed from her by the Plaintiff. The position is otherwise with the remaining causes of action pleaded in the Cross-Claim. 70The causes of action pleaded in Sections 2 and 3 of the Cross-Claim do not differ in substance from what was pleaded in paragraphs 16 and 18 to 28 of the First Cross-Claim. Those causes of action were considered by me in my December 2010 judgment. I held that there was no cause of action against FMA arising from those facts. The pleading in the Amended Statement of Claim concerning the Plaintiff's mistaken belief is not relevant to these causes of action. In relation to these causes of action there is no material change of circumstances to permit the re-pleading of these causes of action in the face of my December 2010 judgment. 71Section 4 of the Cross-Claim pleads breaches of statutory obligations imposed by s 912A(1)(a) Corporations Act and Section 6 pleads statutory unconscionability. The pleading in Section 4 was said by the Second Defendant simply to be a precursor to the pleading of unconscionability in paragraph 54. Two things can be said about these claims. First, the Second Defendant was always able to assert these statutory matters because they derive from the assertion that the Second Defendant did not sign any of the FMA documents. Nothing changed by the new pleading in the Amended Statement of Claim. Secondly, for the reasons I gave in my December 2010 judgment, there is no justiciable issue on these causes of action between the Second Defendant and FMA. Any such issue forms part of the consideration of any defence to the Plaintiff's claim for possession and for any monetary sum owing under the Plaintiff's loan. 72Section 7 of the Cross-Claim was pleaded in an attempt to overcome difficulties arising from the Second Defendant's desire to assert that FMA's mortgage was unjust by reason of the Contracts Review Act. The difficulties derives from the fact that the Second Defendant asserts that she did not sign any documents with FMA. Hence, she relied in the first instance on s 36(11) Real Property Act to argue that by virtue of the registration of FMA's mortgage she had a deed "duly executed by the parties". 73Parts 1 and 2 of Section 7 of the Cross-Claim suffers from the same problems as do Sections 4 and 6 but more clearly so. The principal holding in my December 2010 judgment was that which is contained in paragraph [43], set out above at [14]. Permitting the Second Defendant to plead this cause of action which is simply a claim for relief under the Contracts Review Act (see Cross-Claim paragraph 60) would be entirely inconsistent with my December judgment. Further, the new cause of action in the Amended Statement of Claim is not relevant to this claim. That new claim does not alter the consideration given to the Contracts Review Act claim in my December judgment. 74The remainder of Section 7 is a pleading, essentially, of unconscionable behaviour on the part of FMA which is said to enliven personal equities to overcome the indefeasibilty provisions in the RPA. For similar reasons to those given in respect of Sections 4 and 6, these matters were always known to the Second Defendant. They have not arisen by virtue of the Amended Statement of Claim. They are, as the Second Defendant acknowledged, anticipatory of matters which might be raised by FMA in defence of the claim which the Second Defendant wishes to make. If those matters are to be raised it would be in any Reply to FMA's defence. 75Even if I were not of the view that my December 2010 judgment precluded the bringing of the causes of action other than the claim for misleading and deceptive conduct, I would, as a matter of discretion, have refused leave for them to be included in the Amended Fourth Cross-Claim for these reasons. First, there was no appeal from my judgment of December 2010. Secondly, all that was sought to be included in the Fourth Cross-Claim filed January 2012 was the claim for misleading and deceptive conduct. Thirdly, that cause of action alone is associated with the changes made to the Amended Statement of Claim. 76Fourthly, I do not read the Associate Judge's remarks as granting leave to do other than re-plead the misleading and deceptive conduct claim. The Second Defendant was given one further chance to plead that claim properly. To permit the Second Defendant, who has at all material times been legally represented, to plead fresh causes of action in the third attempt at a cross-claim almost three years after the first cross-claim was filed would not be consistent with ss 56 and 58 CPA. Nor would it be consistent with forensic decisions taken by the Second defendant and/or her legal advisors: Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175 at [102] - [111]. No explanation has been provided for the delay in seeking to plead these other causes of action at this late stage 77The result is that leave should only be given to the Second Defendant to plead the cause of action set out in Section 5 of the Cross-Claim. 78During the course of submissions Mr Pritchard SC for the Second Defendant accepted that there were some problems with parts of the pleading in Sections 2 and 5 including paragraphs 18 and 53 as well as allegations concerning the falsity of representations made by FMA. He accepted that the pleading needs further refinement. Mr Lee SC for FMA agrees that if the Second Defendant is permitted to plead the claims in this section leave should be given to get the pleading into proper form. In the light of what the Associate Justice said about "one further opportunity" to get the pleading right Mr Lee's agreement is generous, and I will not prevent that course.

Conclusion 79The result, in substance, is that the Second Defendant is entitled to maintain a cross-claim confined to a count based on misleading and deceptive conduct because my December 2010 judgment was interlocutory and circumstances have changed by reason of the new claim made by the Plaintiff against the Defendants. 80I will hear the parties on costs. However, my preliminary views are these. FMA should pay the costs of its Motion appealing from the judgment of Harrison AsJ. The Second Defendant should pay the costs of FMA's motion to dismiss or strike out the Fourth Amended Cross-Claim. There should be no costs of the Second Defendant's Motion to vary the December 2010 judgment. 81Accordingly, I make the following orders: (1)Dismiss FMA's Notice of Motion filed 26 June 2012. (2)On the Second Defendant's Amended Notice of Motion filed 27 September 2012 set aside the judgment entered by Davies J on 3 December 2010 and in lieu order that the First Cross-Claim be dismissed with costs. (3)On FMA's Notice of Motion filed 16 October 2012: (a)Dismiss the causes of action contained in paragraphs 24 to 29 and 43 to 72 of the Amended Fourth Cross-Claim filed 12 June 2012; (b)Strike out the remaining paragraphs of the Amended Fourth Cross-Claim with leave to re-plead the matters contained in those paragraphs. (c)Any Further Amended Fourth Cross-Claim is to be filed and served within 14 days.

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