Green & Ors v Pearson [2014] QCA 110

PROCEDURE - SUPREME COURT PROCEDURE - QUEENSLAND - PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS - PLEADING - DEFENCE AND COUNTERCLAIM - ADMISSIONS - where the primary judge gave the respondent leave to withdraw admissions in his defence - where the proposed defence is potentially defective - whether the primary judge's decision was erroneous

PROCEDURE - SUPREME COURT PROCEDURE - QUEENSLAND - PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS - PLEADING - DEFENCE AND COUNTERCLAIM - ADMISSIONS - where the appellants submitted there was no evidence to support the respondent's denial of the admissions made - where the primary judge relied on an affidavit of the respondent verifying the proposed defence - where the respondent was the principal witness who might be expected to know the relevant facts - whether the primary judge made an error of principle or failed to take a material consideration into account in relying on the respondent's affidavit

PROCEDURE - SUPREME COURT PROCEDURE - QUEENSLAND - PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS - PLEADING - DEFENCE AND COUNTERCLAIM -ADMISSIONS - where the primary judge gave the respondent leave to withdraw admissions in his defence - where the admissions were deemed pursuant to r 166(5) of the Uniform Civil Procedure Rules 1999 (Qld) - where the respondent had sought summary judgment of the claim in lieu of providing a detailed defence - where the appellant argued that the respondent's admissions were made formally and deliberately - whether there was an error by the primary judge in giving less weight to the way in which the admissions were made

PROCEDURE - SUPREME COURT PROCEDURE - QUEENSLAND - PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS - COSTS - where the primary judge held that costs should be "in the cause" - where the primary judge took into account the respondent's conduct in bringing a summary judgment application without preparing a proper defence and that the appellants had failed to raise certain criticisms with the respondent prior to the hearing of the application - whether those matters were irrelevant or extraneous to the exercise of the primary judge's discretion

Limitation of Actions Act 1974 (Qld), s 10

Uniform Civil Procedure Rules 1999 (Qld), r 5, r 166(3), r 166(4), r 166(5), r 188, r 367

Bank of Western Australia v Salmon (No 1) [2009] NSWSC 224, cited

Candy v GIO General Ltd [2013] NSWSC 810, cited

Drabsch v Switzerland General Insurance Co Ltd & Ors, unreported, Supreme Court of New South Wales, No 3008 of 1993, Santow J, 16 October 1996, cited

Liao v State of New South Wales [2014] NSWCA 71, cited

SLE Worldwide v WGB & Ors [2005] NSWSC 816, cited

[1] FRASER JA: I agree with the reasons for judgment of Jackson J and the order proposed by his Honour.

[2] MORRISON JA: I have had the advantage of reading the reasons of Jackson J and agree with his Honour's reasons and the order he proposes.

[3] JACKSON J: The plaintiffs in the proceeding appeal against an order granting leave to the fifth defendant to amend his defence. The principal point at issue is that leave was given to withdraw deemed admissions consequent upon the terms of the original defence. Rule 188 of the Uniform Civil Procedure Rules 1999 (Qld) ("UCPR") provides that a party may withdraw an admission made in a pleading only with the court's leave. The primary Judge exercised the discretion to give leave. This appeal is accordingly an appeal against the exercise of a discretion on a matter of practice and procedure under the UCPR. It is appropriate at the outset to identify two central propositions which affect the disposition of such an appeal.

[4] First, the statutory right of appeal to the Court of Appeal from an interlocutory order of a Judge of the Supreme Court engages principles applied in similar contexts in appellate courts in this country, including this Court. A helpful statement appears in Liao v New South Wales,[1] a recent decision of the Court of Appeal of New South Wales, about an appeal from order of the Supreme Court of New South Wales about admissions. Barrett JA said:

"The discretionary nature of the decisions means that appellate intervention is warranted only on grounds identified in House v R [1936] HCA 40; (1936) 55 CLR 499 at 504-5 including that the decision is affected by extraneous or irrelevant matters or the judge mistakes the facts, acts on a wrong principle or does not take into account a material consideration or the decision is unreasonable or plainly unjust. The fact that matters of practice and procedure only are involved means that the appellant court should exercise the 'added restraint' that that circumstance attracts (Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc [1981] HCA 39; (1981) 148 CLR 170) and 'be extremely reluctant to interfere' (In the Will of FB Gilbert (dec) (1946) 46 SR (NSW) 318)."[2]

[5] Secondly, the philosophy of the UCPR is important in considering an appeal from the exercise of a power conferred by those rules. As r 5(1) provides, the purpose of the rules is to facilitate the just and expeditious resolution of the real issues in civil proceedings at a minimum of expense. And as r 5(2) provides, accordingly the rules are to be applied by the courts with the objective of avoiding undue delay, expense and technicality and facilitating the purpose of the rules.

[6] That philosophy is also reflected in r 367(1) under which the court may make any order or direction about the conduct of a proceeding it considers appropriate, even though the order or direction may be inconsistent with another provision of the rules. As r 367(2) provides, in deciding to make an order or direction, the interests of justice are paramount. Rule 367(5) then provides that if a court's order or direction is inconsistent with another provision of the rules, the court's order or direction prevails to the extent of the inconsistency.

[7] The decision of the primary Judge, made under r 188, to give leave to the respondent to amend the defence, must be viewed against the background of r 5 and r 367, when this Court asks the question whether it should interfere with his Honour's exercise of discretion.

[8] The appellants are Mr and Mrs Green and companies associated with them. It appears that they carried on businesses by way of development and construction of real property, although the business or businesses are not alleged with particularity in the statement of claim. The respondent was employed by the seventh appellant from December 2000 to March 2005 and by the sixth appellant from April 2005 to April 2006 in the capacity of a construction manager.

[9] The other four defendants are Mr Basile and companies associated with him. Mr Basile was an accountant. The second defendant was a company which carried on the business of an accountancy practice. Mr Basile was a director of that company.

[10] The plaintiffs' claims against the respondent begin with a transaction alleged to have occurred on 6 September 2001 and end with a transaction alleged to have occurred in April 2006. The proceeding was started on 6 May 2013. It is not alleged that the respondent had any prior notice of the proceeding or any claim made in it against him. The respondent was served on 11 May 2013.

[11] The claims against the respondent are for breach of his employment contracts or fiduciary obligations as an employee. A summary of the claims against him may be conveniently extracted from an outline of argument of the appellants filed on an application brought by the respondent for summary judgment. It is alleged that he:

(a) deliberately assisted Mr Basile, the first defendant, to have [the sixth appellant] improperly pay invoices for building materials used in the renovation of Mr Basile's residence ("Riverview Crescent");[3]

(b) deliberately did not cause employees of [the seventh appellant] to complete time sheets as to the detail of what job they were working on which would have allowed for the work carried out by [its] employees on Riverview Crescent to be detected and for payment to be required;[4]

(c) ordered building materials and approved invoices to be paid by [the sixth appellant] for those materials which were then used by him on a project he undertook for his own benefit at Palm Beach in circumstances where he knew that he was not entitled to do so;[5]

(d) caused [the seventh appellant's] employees to carry out work on his own project at Palm Beach in circumstances where he knew that he was not entitled to do so and had deliberately not caused them to keep a record of the time that they spent working on that project so as to reduce the risk that the plaintiffs would become aware of that;[6]

(e) obtained cash payments from [the sixth appellant] and had various of his expenses met in circumstances where he knew that such payments were to his personal advantage; that he had no entitlement to them and that they were to the detriment of [the sixth appellant].[7]

[12] There are more than one hundred alleged transactions comprising payments of varying amounts to many different payees, extending over the period beginning in September 2001 and ending in April 2006, that are collectively the subject of these claims.

[13] From that summary, it can readily be seen that the proceeding involves a serious degree of factual and legal complexity. As a former employee, the respondent would not be expected to have possession of relevant documents evidencing the appellants' transactions or payments. Given the lapse of time between the events in question and the date on which the proceeding was started, the respondent cannot be expected to have a detailed recollection of many of the facts.

[14] The explanation for bringing the proceeding so long after the relevant events is the contention that the appellants were not aware of the conduct of the respondent until after 7 May 2007, following which they allege that they "acted with reasonable diligence to investigate the financial affairs of [the sixth appellant] and [seventh appellant], which uncovered the conduct of the [respondent], by [obtaining missing invoices and examining financial records and discussion with former employees]".

[15] It must be observed that even if the appellants were not aware of a potential claim against the respondent until 7 May 2007, they started the proceeding only one day short of six years after that.

[16] Faced with the claim and statement of claim after such a long period of time, the respondent applied for summary dismissal of the proceeding against him by an application for summary judgment made under r 293. The application was founded on s 10 of the Limitation of Actions Act 1974 (Qld) as a defence to the claims for damages for breach of contract and on the analogous equitable principles in defence to the claims for breach of fiduciary obligation.[8] The application was filed on 14 June 2013.

[17] Rule 293 provides that a defendant may apply to the court for judgment against a plaintiff "at any time after filing a notice of intention to defend". A notice of intention to defend may be filed and served at any time before judgment (r 138) and must have the defendant's defence attached to it (r 139(1)(b)). Accordingly, in order to apply for summary judgment on the ground that the limitation period had expired, the respondent was required to file a defence. A defence was filed on 14 June 2013.

[18] The substance of the defence was surprisingly short. The respondent admitted the description of the parties, so far as they related to the plaintiffs, but not otherwise, and he admitted that he was employed by the sixth appellant and seventh appellant as construction manager during the periods alleged. The defence also alleged that the claims for damages for breach of contract were barred by virtue of s 10 of the Limitation of Actions Act 1974 (Qld) and that every claim by the plaintiffs for equitable compensation for breach of fiduciary duty was bound to fail as a consequence of limitation by obedience, or limitation by analogy, or laches. Otherwise, the defence simply pleaded:

"The Fifth Defendant does not admit nor deny [sic] each and every other allegation of fact contained in the Statement of Claim because within the time limited for entering his defence, the Fifth Defendant has had insufficient time to investigate the truth, accuracy or otherwise of the allegations contained therein."

[19] That was an improper pleading for three reasons. First, it is not permissible to plead alternatively that a party either does not admit or denies an allegation of fact contained in a statement of claim. In most instances, a party who makes a non-admission may not give or call evidence in relation to the fact: r 165(2). Where the opposite party is faced with an alternative plea of non-admission or denial of the same fact, it will not know whether the pleader is entitled to go into evidence on the issue of fact.

[20] Second, r 166 restricts the right of a party to plead a non-admission. Rule 166(3) provides that a party may plead a non-admission only if the party has made enquires to find out whether the allegation is true or untrue and the enquiries for the allegation are reasonable, having regard to the time limited for filing and serving the defence or other pleading in which the denial or non-admission of the allegation is contained, and the party remains uncertain as to the truth or falsity of the allegation. In the present case, it may be assumed that 28 days or thereabouts was not enough time to find out whether many of the allegations contained in the statement of claim against the respondent were true or untrue.[9] But having regard to the contents of the statement of claim and the material which has subsequently emerged, the respondent could not have been uncertain as to the truth or falsity of "each and every other allegation of fact" made in the statement of claim.

[21] Third, r 166(4) provides that a party's denial or non-admission of an allegation of fact must be accompanied by a direct explanation for the party's belief that the allegation is untrue or cannot be admitted. The defence contained no explanation for any denial and only the peremptory statement that the fifth defendant had had insufficient time to investigate, for any non-admission.

[22] Instead of pleading in compliance with the UCPR, the approach taken on the respondent's behalf was to apply to terminate the proceeding by the summary judgment application based on the limitation defences. The respondent sought to avoid the cost of pleading further than as set out above. The appropriate action for a party faced with insufficient time to prepare a response to a pleading of factual and legal complexity is to apply for an extension of time under r 7(1), if the opposite party will not agree to an extension.

[23] The consequence of the respondent's non-compliance with r 166(4) was that the respondent was deemed to have admitted "each and every other" allegation made in the statement of claim: r 166(5).

[24] However, an order for an extension of time would not have enabled the respondent in the present case to make the application for summary judgment before he incurred the costs of preparing a proper defence, unless he also applied for an order or direction to permit that course under r 367(1). The respondent did not do so.

[25] The application for summary judgment was adjourned at the request of the appellants. A few days before the adjourned hearing, the appellants filed their reply to the defence, raising a reply of fraudulent concealment within the meaning of s 38 of the Limitation of Actions Act 1974 (Qld) to the defence under s 10 of that Act and equitable replies of a similar kind to the defences that the claims for equitable compensation were bound to fail as a consequence of limitation by obedience or limitation by analogy or laches.

[26] On 22 July 2013, the application for summary judgment was dismissed. Directions were made for the respondent to provide a draft amended defence to the appellants and for the appellants to indicate by letter whether they required the respondent to apply to withdraw any deemed admissions.

[27] On 16 October 2013, in accordance with those directions, the respondent's application for leave to amend the defence so as to withdraw the deemed admissions was heard and resulted in the order presently under appeal.

[28] In ex tempore reasons, the primary Judge identified the appellants' opposition to leave being given as being placed on two bases as follows:

"The first is that the fifth defendant made a tactical decision to, in effect, admit the allegations made against it and to rely solely on the limitation Defence. The second is that there is an absence of evidence on some key matters in issue, and the authorities make it clear that only when those matters are clearly supported by evidence will leave to withdraw be given."

[29] The primary Judge's reasons rejected the first contention on the ground that the respondent's acceptance of the allegations in the statement of claim was for the limited purpose of resolving the application for summary judgment. His Honour referred to the costs that would have been expended in preparing a proper defence, and that saving of costs is a relevant factor. His Honour was not prepared to make a finding that there was a tactical decision to admit anything other than for the limited purposes of the application. His Honour was not persuaded that the likelihood of failure of the application for summary judgment based on the limitation grounds was such that it ought to lead to the respondent being forced to adhere to a tactical position adopted for the purposes of the summary judgment application.

[30] As to the contention as to absence of evidence on some key matters, his Honour was prepared to act on the affidavit of the respondent that:

"The proposed Amended Defence which is attached and marked 'WDP1' to this my Affidavit reflects accurately the acts, facts and matters relating to the affairs of myself and the 'Green Group', which constitutes the Plaintiffs in this action.

I swear that the contents of exhibit 'WDP1' is [sic] true and correct. I dispute the claims of the Plaintiff [sic]."

[31] His Honour's view was that the matters in issue were matters which were within the respondent's knowledge but it would not be expected that the details would still be retained in his mind. He also expressed the view that it would be unlikely that the respondent would have much in the way of documents from the time of the alleged events. Consequently, he did not think that the fact that the evidence that supported the allegations was from the respondent, and from him alone, was of any particular weight against the application.

[32] His Honour was of the view that the proposed amended pleading descended into particularity to a considerable extent and was convincing, in his mind, as to the existence of a general dispute.

[33] A third submission was made by the appellant to the primary Judge based on the contention that the proposed amended defence did not plead to all of the relevant allegations in the statement of claim. His Honour referred to the plaintiffs spending considerable time going through the proposed amended defence and drawing attention to criticisms. But he took the view that, when looked at in the whole picture, they were not matters of such weight as to warrant the refusal of leave to withdraw the admissions.

[34] His Honour instructed himself by reference to the decision of this court in Hanson Construction Material Pty Ltd v Davey[10] and referred to the five factors identified in the reasons for judgment in that case as relevant to an application to withdraw admissions as follows:

"The first was how and why the admission came to be made. I've dealt with that already. The second was the evidence surrounding the issues, the subject of the admission. That evidence is found in the verification of the proposed defence. That demonstrates to my satisfaction that there is likely to be a real dispute about the evidence, and, in some respects, the defence of the other defendants also supports the view that there is likely to be a real dispute about those matters. That is the third of the factors specified in Hanson. Fourth is the question of whether any delay has been made in the application for leave to withdraw the admissions. In the present case there has been no delay. The matter has indeed proceeded quite promptly. Finally, there is the question of prejudice to the other party. Mr Williams, on behalf of the plaintiff, frankly considered that no prejudice would be suffered by the plaintiff if leave were granted. That is to say, no prejudice in the relevant respects."

[35] For those reasons, and with specific directions as to particular matters by way of further pleading which need to be attended to in the final amended defence, his Honour made the order giving leave to amend the defence.

[36] The appellants challenge the primary Judge's exercise of discretion on four main grounds. First, they submit that the proposed amended defence was defective because it did not respond to a number of allegations in the statement of claim. Second, they submit that the respondent's affidavit verifying that defence was insufficiently particular to show that there is evidence supporting the proposed denials. Third, they submit that the primary Judge failed to take into account the relevant matter that formally made admissions should not be permitted to be withdrawn except in certain circumstances. Fourth, they submit that the primary Judge took into account an irrelevant matter, namely the reasonableness of making admissions for the limited purpose of bringing an application for summary judgment.

[37] Before the primary Judge, the appellants opposed the order sought on the basis that the proposed amended defence did not respond or respond adequately to all of the allegations in the statement of claim.

[38] The primary Judge acknowledged that there were omissions and defects in the proposed pleading as follows:

"I am satisfied that the proposed Defence does not adequately plead to paragraph 101(c)(2) of the Statement of Claim. I am further satisfied that paragraph 9 of the proposed Defence is formally deficient... I am also satisfied that [the proposed Defence] does not adequately plead to paragraph 113(c)... The same is true of the pleading in response to paragraph 115(d)... What is contained in paragraph 13(b) is insufficient... Paragraphs 118 to 120 of the Statement of Claim have simply not been pleaded to at all, presumably by accident, and they must be dealt with. The response in paragraph 19 of the proposed Defence to paragraphs 120 to 132 of the Statement of Claim is not, in my judgment, adequate... Paragraph 133 of the Statement of Claim... is also not properly pleaded to... It follows, therefore, that, in my view, a pleading which is in conformity with the exhibit and with these reasons for judgment is one which leave to deliver should be given."

[39] Thus, his Honour considered with some care the appellants' submissions as to the continuing inadequacies of the proposed pleading. On the appeal, the appellants renewed and expanded the attack on this subject matter. They added to the paragraphs not responded to or not adequately responded to by including reference to pars 101(a), 102, 108 (although that was the paragraph the subject of the observation of his Honour about par 9 of the proposed defence), 109(d), 109(e), 110(d), 114(a) and 115(e) of the statement of claim.

[40] There are three difficulties with the way in which the appellants' approach this subject. First, the prima facie effect of a failure to withdraw an admission of one fact is not a preclusion against the grant of leave to withdraw an admission of another fact. Where a party applies for leave to withdraw admissions, it may be relevant to consider that other admissions, which will not be withdrawn by the proposed amendments and therefore will remain, reflect on whether it is appropriate to give leave to withdraw the particular admissions to be withdrawn by the leave to amend which is sought. But there is no simple rule that the failure of proposed amendments to deal with all the deemed admissions or to plead adequately to each and every allegation in the statement of claim will have a debarring effect on an application to amend in a way that withdraws some admissions.

[41] Second, the appellants' submission as to the effect of the remaining claimed inadequacies of the proposed defence was that the application must be refused entirely, not that particular defective proposed amendments should not be allowed, or that there should be any direction for further pleading on some points, although that was the effect of the order of the primary Judge.

[42] Third, the appellants deployed this argument in a tactical way, by not disclosing any of the points as to the alleged inadequacies of the proposed amended defence before oral argument on the application for leave to amend was heard. It is clear that the primary Judge took that consideration into account, both in his statement that the failure to plead to pars 118 to 120 of the statement of claim in the proposed amended defence was "presumably by accident" and in exercising his discretion as to costs of the application.

[43] In my view, it is not appropriate for this Court to essay an opinion on the added complaints, although the appellants were not precluded from agitating them on the appeal. Plainly, there can be no criticism of the exercise of discretion by the primary Judge for failing to consider additional arguments that were not put to him. Unless they were of such persuasive effect as to lead to the conclusion that the result of the orders made by his Honour can be seen to be unreasonable or plainly unjust it would be inappropriate to deal with them further. In my view, they do not have that effect.

[44] As to the complaints advanced to the primary Judge, there may be scope for further challenge to particular parts of the proposed amended defence which were not dealt with by his Honour's reasons in the passage set out above. But the question for decision is not about those potential challenges. It is whether the decision of the primary Judge to grant leave to amend was affected by extraneous or irrelevant matters or the Judge mistook the facts, acted on a wrong principle or did not take into account a material consideration or the decision is unreasonable or plainly unjust. In my opinion, judged against those criteria, the complaints do not amount to a basis for interference with the exercise of discretion.

[45] The appellants rely on cases which support the contention that in many cases a party will need to prove the existence or reasonable likelihood of the existence of evidence to support the denial of the admission which it is seeking leave to withdraw.

[46] In exercising the discretion to give leave to withdraw an admission, there is no a priori rule as to what evidence is required in every case. Nor is there an a priori rule that an affidavit generally verifying a proposed defence will not be enough. Like the primary Judge, in my view it was relevant in the present case that the respondent who swore the affidavit was the principal witness who might be expected to know the relevant facts. It was therefore open to the primary Judge to act upon an affidavit generally verifying the contents of the draft defence dealing with facts within his knowledge. His Honour did so specifically because of the "level of detail with which the proposed amended pleading deals with the plaintiffs' allegations".

[47] That view was adopted in the context that after so much time "it would not be expected that the detail would still be retained in his mind" and that it would "be unlikely that he would have much in the way of documents from the time of the alleged events".

[48] In my view, there was no error of principle or failure to take a material consideration into account by his Honour in taking that approach in the circumstances of this case.

[49] Before the primary Judge, there was a debate about whether it was reasonable for the respondent to have brought the summary judgment application. The respondent sought to re-enliven the question on the hearing of the appeal. However, the answer to the question is of limited relevance. It goes only to whether the respondent should be given leave to withdraw the admissions which had come about because of the decision to apply for summary judgment rather than to prepare a complying defence. The primary Judge said that he would not "be critical of the decision to seek to have the matter decided on a summary basis". Although that was a matter relevant to the circumstances in which the deemed admissions came to be made, and therefore relevant to the decision on the application for leave to withdraw them, I would not generally endorse any suggestion that it is an appropriate procedure for a defendant to file and serve a "holding" defence that does not comply with the UCPR.

[50] The appellants relied on statements made in cases where the admissions sought to be withdrawn were made formally and deliberately. For example, an admission made "after consideration and advice... and after a full opportunity to consider its case and whether the admissions should be made".[11]

[51] The primary Judge considered that the appellants sought to make too much of the cases involving formally and deliberately made admissions and that they were "not apposite". The respondent's admissions were neither formal nor deliberate, in the senses described above. On the contrary, the defence attempted not to admit or deny almost all the allegations contained in the statement of claim. Because it did so in a way that did not comply with the requirements of r 166, deemed admissions were made. That was a consequence of the operation of the UCPR, not a formal or deliberate action evidencing an intention by the respondent to make admissions. The reason for the defence following that form was to bring the application for summary judgment, which was done promptly.

[52] In those circumstances, it was open to his Honour to give less weight to the way in which the admissions were made than might be given in a case where the admission was made formally and deliberately. The facts of this case are not the same as in the other cases relied on by the appellants.

[53] There was no error of principle or failure by the primary Judge to take a relevant consideration into account in his Honour's approach. No error in the exercise of the discretion is disclosed because his Honour did not treat the statements in those cases as determinative of the present case.

[54] The primary Judge ordered that the costs of the application be made "costs in the cause".[12] The appellants contend that the primary Judge's discretion on the question of costs miscarried. The primary Judge took into account that the respondent's conduct in bringing a summary judgment application without first incurring the costs of preparing a proper defence was "reasonable". The appellants submit that the primary Judge's discretion was thereby affected by an irrelevant or extraneous matter, because the UCPR do not permit that form of procedure.

[55] The appellants also challenge that his Honour was entitled to take into account that the appellants had not alerted the respondent to their criticisms of the proposed amended defence before the hearing of the application.

[56] In my view, the primary Judge's exercise of discretion in making the order for costs should not be disturbed.

[57] First, the order made does not deprive the appellants of their costs of the application, unless they are unsuccessful in the proceeding.

[58] Second, in my view, his Honour was entitled to take into account that the appellant had chosen to delay its criticisms of the proposed amended statement of claim until the hearing of the application. The proposed pleading had been provided to the appellants prior to the application for leave to amend under a direction of the Court. The appellants had then responded that they would oppose leave being given to withdraw any admissions without any suggestion that was because of the terms of the proposed amended defence. Bearing in mind the philosophy of the UCPR in r 5, and the provision in par 6 of Practice Direction 14 of 1999 that outlines of argument are to be exchanged as early as practicable prior to the hearing, it was a material consideration that if a curable point is not notified to the other side costs and time may be wasted. The direction that the respondent provide the draft proposed amended defence to the appellants and that they notify their attitude to it was intended to give them the opportunity to save the parties unnecessary costs by notifying the substance of their objections.

[59] Third, the appellants' challenge to the primary Judge's view that the respondent's conduct was reasonable was premised on the proposition that the UCPR do not permit the course adopted by the appellants. To an extent, the discussion of the operation of the UCPR set out above supports that contention. However, the operation of the philosophy in r 5 must not be forgotten. In particular, that "the purpose of these rules is to facilitate the just and expeditious resolution of the real issues in a civil proceedings at a minimum of expense [and] [a]ccordingly these rules are to be applied by the courts with the objective of avoiding undue delay, expense and technicality and facilitating the purpose of these rules". It is also important that r 367 provides for the making of an order or direction "inconsistent with another provision of the rules" where the court considers it appropriate and provides that the court's order or direction "prevails to the extent of the inconsistency". The processes of the UCPR are not an end in themselves. Thus, although there is force in the appellants' criticism that the respondent's manner of proceeding was not authorised by the rules, in my view the characterisation of that conduct as reasonable did not amount to the primary Judge's discretion being affected by an irrelevant or extraneous matter.

[1] [2014] NSWCA 71.

[7] Statement of claim, pars 137 and 138.

[8] The respondent appears to have overlooked the Corporations Act 2001 (Cth) claim, but so did the appellants who did not rely on s 1317H of the Corporations Act 2001 (Cth) in the statement of claim against him.

[9] It should be added that r 166(6) of the UCPR provides that a party making a non-admission remains obliged to make any further enquires that may become reasonable and if the results of the enquires make possible the admission or denial of an allegation, to amend the pleading appropriately.

[10] [2010] QCA 246; (2010) 79 ACSR 668.

[11] Drabsch v Switzerland General Insurance Co Ltd & Ors, unreported, Supreme Court of New South Wales, No 3008 of 1993, Santow J, 16 October 1996, applied in SLE Worldwide v WGB & Ors [2005] NSWSC 816; Bank of Western Australia v Salmon (No 1) [2009] NSWSC 224, [32]; Candy v GIO General Ltd [2013] NSWSC 810, [53].

[12] The power to make an order for costs is statutory and is now contained in s 15 of the Civil Proceedings Act 2011 (Qld) and UCPR r 681(1) as a rule of court. That rule was made under the rule making power under s 85 and item 21 of Sch 1 of the Supreme Court of Queensland Act 1991 (Qld). The word "cause", was used in the Judicature Act 1876 (Qld) as a word of wide description at a time when there were numerous different kinds of civil proceedings, and that use was reflected in the statutes and rules as to civil jurisdiction which came after it. Following the enactment of the Civil Proceedings Act 2011 (Qld), the word "cause" no longer appears in any of the statutes as to civil proceedings of this State, or in the UCPR. The word used in the current statutes and rules to describe what was once called a "cause" is "proceeding". The order should be understood as an order for costs in the proceeding.