Judgment
1HER HONOUR: Listed before me for hearing on 27 August 2012, were various Notices of Motion each filed on 1 June 2012 (by the plaintiffs, the second and third defendants, and the fifth defendant respectively). The plaintiffs, by their Notice of Motion, seek leave further to amend the Third Amended Summons and Further Further Amended Points of Claim filed by them in these proceedings in February this year. The second and third defendants seek a variety of relief in relation to the proposed further amended summons and points of claim (in essence not to permit those documents to contain particular claims or allegations and to strike out any prayer or claim to the effect of those in respect of which complaint is made), an order for the provision of further and better particulars and an order for the provision of security for their costs. (The Notice of Motion filed on 1 June 2012 by the fifth defendant in relation to the proposed further amended summons and points of claim was argued only in relation to costs, as the plaintiffs had agreed not to press those of the amendments to which the Commonwealth had objected, and was the subject of ex tempore reasons which I gave on that day.)
2The substantive debate before me on 27 August 2012 was therefore between the plaintiffs and the second and third defendants (both the fourth and fifth defendants consenting to leave being granted for the filing of a Further Amended Summons and Further Amended Points of Claim in the form of those handed up to me by Counsel for the plaintiffs, Mr P King).
Background
3The background to the present applications can be briefly stated.
4The first plaintiff (Hoxton Park Residents Action Group Inc) is an incorporated association of which the second plaintiff (Mrs Marella Harris) is a member. Mrs Harris is a resident of Hoxton Park who lives in close proximity to land which was acquired by the third defendant (the Australian Federation of Islamic Councils Inc) and on which the second defendant commenced development in March 2010 of what has been referred to in the proceedings as a faith-based educational facility and place of worship.
5These proceedings were commenced by the incorporated association by way of Summons filed on 22 July 2009 (at which time the only defendant was Liverpool City Council). The association sought to restrain the funding of the development (alleging, among other things, that the funding was obtained from the Commonwealth by way of grant made under the Schools Assistance Act 2008 (Cth) and that, to the extent that such a grant was permitted by that Act, the legislation was invalid as being in contravention of s 116 of the Commonwealth Constitution). Subsequently (in May 2010), Mrs Harris was joined as a plaintiff. The second defendant was joined as a defendant just before then (its appearance being filed on 1 April 2010) and the third defendant presumably around that time (being named as a defendant on the summons of 10 May 2010). The fourth defendant filed an appearance on 15 June 2010 and the fifth defendant on 20 May 2010. The first Points of Claim seem to have been filed on 10 May 2010 (at which time only the first three defendants were named), and the Points of Claim contain the notation that this was by direction of Palmer J on 3 May 2010. Over time since then there have been successive iterations of those points of claim.
6In 2010, each of the defendants successfully applied to have the proceedings dismissed pursuant to rule 13.4(1)(b) of the Uniform Civil Procedure Rules 2005 (NSW) on the basis that there was no reasonable cause of action disclosed (see unreported judgment of Rein J on 12 November 2010). (In the alternative, they had sought to have the Second Further Amended Summons struck out pursuant to rule 14.28(1) of the Rules.) On appeal (Hoxton Park Residents Action Group Inc v Liverpool City Council (No 2) [2011] NSWCA 363), Basten JA (with whom Allsop P and Beazley JA concurred) considered (in relation to the challenge to the Constitutional validity of the relevant legislation) that the factual matters pleaded fell outside those addressed in binding High Court authority ([28]) and that the proposition that the Commonwealth could pass a valid law permitting the funding of a religious institution for religious (not educational) purposes was a proper matter for challenge ([35]). In relation to the claims brought in nuisance and negligence, his Honour considered that Mrs Harris should have been allowed an opportunity for repleading those claims ([71]). Leave to appeal was granted and the appeal upheld on grounds limited to the challenges to the Constitutional validity of the Commonwealth legislation providing for the funding in question and the claims in nuisance and negligence (and leave to appeal was otherwise refused). The matter was remitted to the Equity Division for the further conduct of the proceedings. (As a result of the refusal of leave to appeal from parts of the pleading relating to the first defendant, it no longer plays a role in the proceedings.)
7An application was then brought by the plaintiffs for interlocutory relief to restrain the building works in question. On 8 February 2012, that application for interlocutory relief came before the Court for directions. Orders were made for evidence to be filed on the plaintiffs' Notice of Motion and for the filing and service of Amended Points of Claim. Two further versions of the points of claim were subsequently served as well as a further version of the summons (in the period from 13 to 16 February 2012).
8In March 2012, an application (by AFIC and the School) for a declaration as to the validity of the development consent or an order for conditional validity of the development consent was heard by Biscoe J in the Land and Environment Court (which application was unsuccessful). On 23 March 2012 Biscoe J declared the development consent invalid and made orders in relation to the building works.
9Meanwhile the plaintiffs' application for interlocutory relief had come before Nicholas J for hearing in February 2012. His Honour had reserved judgment. In light of the outcome of the proceedings before the Land and Environment Court, Nicholas J dismissed the application for interlocutory relief on 3 April 2012 and ordered that the costs of the parties be costs in the cause. His Honour also ordered the defendants to notify the plaintiffs of objections to the pleadings. The second and third defendants did so by letter dated 13 April 2012.
10Subsequently, on 4 May 2012, the plaintiffs served a further proposed amended summons and points of claim (that being as I understand it, the version of the pleadings annexed to the affidavit in support of the plaintiffs' 1 June 2012 motion for leave further to amend). Further and better particulars of the proposed pleadings were sought by the second and third defendants by their lawyers' letter dated 31 May 2012 (as Mr King notes, the day before any applications in relation to the pleadings were due to be filed). No such particulars were provided. The respective Notices of Motion were then filed on 1 June 2012 pursuant to directions made by the Registrar on 24 May 2012.
11Submissions on the present application were served by the second and third defendants on 3 August 2012 and by the plaintiffs on 14 August 2012 (in the plaintiffs' submissions it being asserted (at [17]) that the specific critique by the second and third defendants of the particulars of negligence raised issues that could and should be addressed by a request for particulars - though it is to be noted that no particulars had been provided in response to the earlier request made on 31 May 2012, whether before the 1 June 2012 time for filing of any notices of motion in relation to the pleadings or in the nearly 3 months thereafter before the matter came before me for hearing of the respective interlocutory applications.)
12On 23 August 2012, the plaintiffs served further versions of the proposed further amended summons and further amended points of claim. On 27 August 2012 yet a further version of the proposed further amended points of claim was handed up (with handwritten deletions of certain paragraphs).
13When the matter came before me, Senior Counsel for the second and third defendants (Mr P Menzies SC), appearing with Mr A Cheshire of Counsel, indicated that the second and third defendants would consent to further time being allowed for the filing of Further Amended Points of Claim that addressed the pleading issues raised in the written submissions. The plaintiffs did not accede to that suggestion, pressing their application for leave to amend (though not in relation to the version of the documents annexed to the affidavit filed in support of the motion; rather, in relation to the version of the Further Amended Summons and Further Amended Points of Claim handed up to me on 27 August 2012 by Mr King, together with amendments that I was requested by Mr King to make on those documents during the course of argument).
14Mr King described the substance of the plaintiffs' case as following the template of that outlined in the passage in Riverina Transport Pty Ltd v State of Victoria (1937) 57 CLR 327 at 341-2, where Latham CJ said:
When a person purports to do a particular act under the authority of a statute it may be the case that what is done is not authorized by the terms of the statute, and therefore that the act done does not by virtue of the statute either create rights in any person or impose duties upon any person. If the act which is done is not authorized by the terms of the statute and is a breach of duty or an interference with a right for which the law provides a remedy, the person doing the act is liable to ordinary legal proceedings. He is liable simply because the ordinary law which makes him liable applies, and he is unable to claim the protection of the statute because, upon proper construction of the statute, his act was authorized or protected by the statute.
Another case arises where an act which is performed by a person is authorized by the provision of a statute but that statute is invalid, so that the act has only apparent and not real legal justification. If what has been done in real or pretended reliance upon the statute is a breach of duty or an interference with a right for which the law provides a remedy, then the person doing the act is liable in ordinary legal proceedings. The position may be simply illustrated by the example of a trespass to goods, where the plaintiff complains of seizure of his goods by the defendant. Such a seizure gives a cause of action at common law unless it can be justified or excused. If the defendant justifies under a statute he must show that his act is authorized by the statute. If this is the only defence and it fails, there will be judgment for the plaintiff. If his act is authorized by the words of the statute upon which he relies, but that statute is invalid because it offends against sec. 92 of the Constitution or for any other reason, then the defence fails. The plaintiff then recovers damages, not for any breach of the Constitution, but for the common law wrong of trespass. No interference with right can be justified by an invalid statute, and, the invalid statute being out of the way, the common law applies. (my emphasis)
15So, for example, in Casley v Commonwealth of Australia (1980) 30 ALR 38, where there was a claim for damages against, inter alios, the State of Western Australia and the Superintendent of the Geraldton Regional Prison for false imprisonment and the defence of statutory authorisation was raised, the finding that the detention was not authorised by the law giving legal force to the warrant and by the warrant itself meant that the defence of statutory authorisation was not made out and the plaintiff succeeded in his action for damages for false imprisonment.
16What Mr King contends (seemingly not distinguishing between the position of the two plaintiffs in this regard) is that, in order to establish the plaintiffs' causes of action both in public and private law, a breach of some ordinary right must be established and that claim must be made in "ordinary legal proceedings". Mr King submits that the second and third defendants, "under colour of a DA purportedly legally granted by the local authority funded by the Commonwealth and the State", have set up a project which is in breach of section 116 of the Constitution. (Insofar as he suggests that the project itself is in breach of the Constitution, the question I understand the Court of Appeal to have addressed was whether there was a reasonable argument as to the validity of the legislation pursuant to which the funding was granted for the project, not as to the validity of the project itself - though nothing turns on this at this stage.)
17The reference to Riverina, as I understand it, is in the context that Mr King anticipates that, in answer to the causes of action in private nuisance, negligence and negligent trespass by Mrs Harris against the second and third defendants, those defendants will contend that their conduct was authorised by the Environmental Planning and Assessment Act 1979 (NSW), the Local Government Act 1993 (NSW) and the decision of the Liverpool City Council as contained in the development application that Mr King points out has now been declared invalid by the judgment of Biscoe J. He submits that the Constitutional challenges are linked in a practical sense to the private law claims against the second and third defendants because, if the Schools Assistance Act 2008 (Cth) and the Education Act 1990 (NSW) are invalid to the extent that is asserted by the plaintiffs, then the funding for the project will no longer be available and it is anticipated that the project will not happen.
18Mr King pointed to Vincent v Peacock [1973] 1 NSWLR 466 (where an appeal against a refusal to grant injunctive relief for a nuisance comprised by noise from a drunken neighbour was upheld, the Court of Appeal noting that the law of nuisance is a protection to property without the assistance of which the rights of property of the plaintiffs could be largely rendered nugatory) and Halsey v Esso Petroleum Co Ltd [1961] 1 WLR 683 (where, inter alia, the defendants were held liable in nuisance for damage done to the plaintiff's washing by acid smuts emitted from chimneys on the defendants' property (as well as for damage occasioned by smuts alighting on the plaintiff's washing or on his motor-car standing in the street, on the principles in Rylands v. Fletcher (1868) L.R. 3 H.L. 330) and for the damage to the motor-car as for a public nuisance in respect of which the plaintiff had suffered special damage) as indicative of the seriousness of the second plaintiff's complaint (and as examples of cases where a claim of nuisance of the kind that the second plaintiff now seeks to bring had been upheld).
Issues
19The issues before me for determination are in a relatively narrow compass: first, whether leave further to amend should be granted (in the form of the documents handed up on 27 August 2012, with the further handwritten amendments thereto, or otherwise) and, secondly, whether the second plaintiff should be ordered to provide security for the costs of the second and third defendants. (An outstanding issue arises as to the costs position in relation to the now abandoned claim by the first and second plaintiffs against the second and third defendants in public nuisance which I will deal with when I publish these reasons. There is also the claim by the second and third defendants for particulars which I deal with in the context of the pleading issues.)
Summary
20I consider that leave further to amend the Summons should be granted subject to an amendment to make clear (as was placed on record by Mr King in the course of argument) that the claim for damages in prayer [16] of the proposed further amended summons as against the second and third defendants is a claim made only by the second plaintiff in her personal capacity (and not as a representative) and subject to the deletion of prayer [17] (which seemingly now has no operation in light of the deletion of the claims for injunctive relief formerly contained in paragraphs [8] and [9] of the summons).
21I consider that leave further to amend the Points of Claim should be granted subject to the following:
(i) provision by the second plaintiff within 7 days of the particulars requested by the second and third defendants on 31 May 2012 (other than any requests for particulars which relate to the now abandoned claim in public nuisance or to paragraphs of the pleading that have already been amended in response to the submissions of the second and third defendants);
(ii) amendment to the particulars in paragraphs [8] and [9] to make clear what is being alleged to be the activities and conduct the subject of complaint and what is being alleged to be the unreasonable disturbance caused to, or substantial interference with, the second plaintiff's land or her use and enjoyment of the land as a result of the alleged activities and conduct;
(iii) in relation to the pleading of negligence:
(a) particularisation of how it is alleged that the activities of which complaint is made are hazardous;
(b) the amendment of paragraph [17] to make clear what is alleged to be the scope and nature of the duty of care owed by the second and third defendants;
(c) amendment to the pleading to make clear (if it be so alleged) that there was a deliberate or intentional wrongful act by the second and third defendants (such as is said to bring the case outside the operation of s 5B of the Civil Liability Act 2002 (NSW)).
(d) to the extent that the second plaintiff relies on any allegation of negligence arising out of a failure to take precautions against a risk of harm to the second plaintiff (which appears to be the case from the particulars to [18]), amendment to the pleading to identify the risk(s) of harm; to make clear what precautions it is alleged that a reasonable person in the second and third defendants' position would have taken against the said risk(s) of harm; and to identify whether the conduct or activities in question are of the second and third defendants or independent contractors;
(e) amendment to the pleading in [19] to make clear the facts, matters and circumstances on which the second plaintiff relies for the allegation that the pleaded breach of the alleged duty of care caused the loss and damage alleged to have been suffered.
(iv) amendment to the pleading of negligent trespass to make clear the material facts on which the claim of trespass is based, namely the particular acts or conduct said to constitute the trespass, the facts on which the second plaintiff relies for the allegation of negligence in this context, and particulars of the loss and damages allegedly suffered thereby.
22I dismiss the application for security for costs to be provided by the second plaintiff (though without prejudice to any further claim that might be made by the second and third defendants in circumstances of the kind adverted to later in these reasons).
23As to costs of the Notices of Motion as between the plaintiffs and the second and third defendants, my preliminary view is that each party should bear her or its own (given that there has been mixed success on those applications).
24I am inclined to think that as a result of the abandonment of the public nuisance claims by the first plaintiff (and by the second plaintiff whether in a representative capacity or otherwise) against the second and third defendants, the plaintiffs should be ordered to pay the costs of the proceedings in relation to those claims to date but as there was only passing argument on this issue at the hearing on 27 August 2012 I will hear any further submissions sought to be made on that point.
25As to the suggestion by Mr Menzies that the hearing of the private nuisance, negligence and trespass claims should in effect be divorced from the hearing of the Constitutional challenge, while I consider there to be merit in that suggestion there was no application to that effect in the Notices of Motion and it may be that this is a matter best left for directions later in the course of preparation for the hearing when the parameters of the hearing can better be assessed. On that issue, however, it may well be the case that if the second and third defendants are required to incur additional costs (above those that would otherwise be incurred in defending the private common law claims) in participating in the hearing of matters the subject of the Constitutional challenge (which do not directly affect them) this might warrant a security for costs order at that stage.
Reasons
(i) Pleading issues
26At the outset I note that Mr King expressly disavowed any claim now being made by the first plaintiff (the incorporated association) against the second and third defendants. He submitted that it was obvious on the face of the proposed Further Amended Points of Claim that there was no longer any such claim being brought. Mr King stated emphatically that the only claims now sought to be brought in these proceedings against the second and third defendants are claims by the second plaintiff in private nuisance, negligence and negligent trespass and that the damages sought against the second and third defendants are confined to damages suffered by the second plaintiff herself (ie, not her family nor the other residents in the neighbourhood or members of the Association).
27Insofar as reference is made to the effect of the development on endangered ecological wildlife adjacent to the second plaintiff's home, the claim that is made (as I understand it) is that part of the damage suffered by the second plaintiff is the inability to observe the ecological wildlife that previously could be observed on the adjacent land (the absence of which is said to be attributable to the works that were carried out by the second and third defendants). Similarly, insofar as reference is made to inconvenience occasioned to her guests as a result of the activities and conduct of the second and third defendants of which complaint is made, reliance is placed on this as part of the damage suffered by Mrs Harris personally (as part of the alleged interference with her property rights and her use and enjoyment of the land).
28It seems to me that the matters so acknowledged by Mr King (together with the deletion of certain remnants of the pleading that related to damage sustained by members of Mrs Harris' family rather than Mrs Harris herself) dispose of a number of the pleading complaints that have been made.
29It was also made clear by Mr King in the course of argument that, while Mrs Harris seeks to bring the proceedings as a representative suit on behalf of the class of persons identified in paragraph 2(e) of the Proposed Further Amended Points of Claim, the representative suit is only in relation to the Constitutional challenge to the legislation in question and does not relate to the claims by Mrs Harris in her personal capacity in nuisance, negligence or trespass. It seems to me that this disposes of the criticism made of paragraphs 1(c) and 2(e) of the Proposed Further Amended Points of Claim.
30The remaining criticisms of the proposed amended points of claim may be grouped within the following categories:
(a) complaints as to the particulars provided of the claim in private nuisance;
(b) complaints as to the pleading of the claim in negligence, namely the failure of the second plaintiff to identify and articulate the material facts on which she relies to establish each of the elements said to be required by s 5B(1) of the Civil Liability Act 2002 (NSW); failure to plead the scope and content of the alleged duty of care (inter alia by reference to what additional precautions it is said the second and third defendants ought to have taken but failed to take); failure to identify whether the relevant acts are said to be those of the second and third defendants or of contractors; and the manner in which causation has been pleaded in paragraph [19] of the proposed Further Amended Points of Claim; and
(c) complaints as to the pleading and/or particularisation of the claim in trespass (bearing in mind that this was not the subject of the leave to replead that the Court of Appeal said should have been given).
31I deal with each in turn:
(a) Nuisance
32The criticisms made of the pleading turn on paragraphs [8]-[11] and [13] of the proposed Further Amended Points of Claim. (Some of those criticisms have been met by the deletion of references to the second plaintiff's children or lawfully invited guests.)
33Paragraph [8] in essence pleads that the second and third defendants "have conducted activities" on the land in question and on public streets and public land adjacent to the second plaintiff's land "which has [sic] caused undue disturbance to the second plaintiff in the use and enjoyment of the second plaintiff's land". Particulars of the alleged "activities and conduct" are set out in paragraphs 8(a) - (j) (some of which on their face are particulars of the alleged undue disturbance or effect of the activities and not directly of the activities themselves). (Mr King submitted that the header might more accurately have read "Particulars of activities and conduct and undue disturbance" and asked that such an amendment be made to the proposed Further Amended Points of Claim. That does not, however, enable an immediate distinction to be drawn between what is a particular of an activity and what is a particular of the effect of, or undue disturbance caused by, that activity.)
34Paragraph [9] then pleads that the "activities" (which Mr King confirmed refers back to the activities in [8]) of the second and third defendants have unreasonably disturbed the second plaintiff in the use and enjoyment of the second plaintiff's land. Particulars are provided in (a) - (h), of that allegation (though (b) and (d) seem to encompass activities (ie, not simply the effect of those activities as such) and, in the case of (b), an activity that is not itself particularised in [8], namely the filling of the land with deposits from the local chicken plant.
35Paragraph [10] pleads that the "activities" of the second and third defendants (and of "their servants or agents") have also interfered in the property rights of the second plaintiff and adversely affected the value of her land (particulars thereof being provided, which particulars also incorporate the particulars to paragraph [9]).
36Paragraph [11] pleads that the "activities and conduct" of the second and third defendants "their servants or agents" have involved a substantial interference in the use and enjoyment of the second plaintiff's land by her. No particulars of the substantial interference in the use and enjoyment of the land are provided.
37Paragraph [13] (as sought to be amended) pleads that as a result of the nuisance created by the second and third defendants the second plaintiff has suffered loss and damage "particulars of which are set forth in paragraph 10 and in paragraph 11 above".
38Mr King points to what was said in Balkin and Davis, Law of Torts, 4th edn chapter 14, pp 449ff, as to the constituent elements of the tort of nuisance and submits that there is no complaint as to the adequacy of the pleading of the constituent elements of the tort of nuisance, simply a complaint about the particulars provided thereof.
39Insofar as the complaint as to paragraph [8] (and for that matter paragraph [9]) is as to the intermingling of particulars, on the one hand, as to the activity or conduct of which complaint is made and, on the other, as to the effect of that activity or conduct, I think that the complaint is well-founded (though readily capable of being addressed through an amendment to the particulars to make it clear).
40For example, [8(b)] refers to "dust" having spread from the land "swirling from the site and settling on the second plaintiff's land". It seems to me that the swirling and settlement of dust on the second plaintiff's land must logically be a cause or effect of some activity or conduct (not the activity or conduct itself). Mr King contended that it was both and referred back to the allegation as to the second and third defendants "having management and control of the land". He described this as an "activity-based" nuisance claim and labelled the complaint made by the second and third defendants as both "hair-splitting and arrogant". Pressed on this issue, Mr King accepted that the relevant particulars should be read as identifying in (a) the activity (ie the bulldozers and other earthmoving equipment working on the land) and (b) the undue disturbance that this activity has caused and of which the second plaintiff makes complaint.
41An even clearer example of the confusion liable to be generated by the particulars in their present form seems to me to be the particulars contained in (i) and (j): (i) being "Increased medium crime risk in the area of Hoxton Park according to the Green Valley Police Report", (j) being "Increased risk of flooding of local land including the second plaintiff's land from that adjacent water course has been contributed to or caused by the activities".
42An increased in medium crime risk in the area cannot sensibly be understood as an activity being conducted on the land by the second and third defendants. It can surely only be said to be the alleged cause or effect of some particular activity or conduct on the land. Similarly, some activity on the land may have caused flooding of the second plaintiff's land (or may have increased the risk of flooding of the second plaintiff's land) but the increase in risk of that event cannot sensibly be described as an activity or conduct by the second and third defendants. What is the relevant activity is whatever is alleged to have been done on the land to cause either the flooding or an increased risk of flooding.
43Mr King's response, ultimately, was that this was simply a question of particulars and could adequately be dealt with by amending the heading to the Particulars. He pointed out (and I accept) that one does not plead to particulars. This was made clear in Pinson v Lloyds and National Provincial Foreign Bank Limited [1941] 2 KB 72 at 75, Scott LJ noting that "It is a well-recognized canon of pleading that the defendant need not, and, indeed, ought not to, plead to "particulars", whether contained in or delivered with the statement of claim." (See also Pennycuick J in Chapple v Electrical Trades Union [1961] 3 All ER 612 at 614.)
44In Bruce v Odhams Press Limited [1936] 1 KB 697 at 712-713, Scott LJ had earlier said:
The cardinal provision in r. 4 is that the statement of claim must state the material facts. The word "material" means necessary for the purpose of formulating a complete cause of action; and if any one "material" fact is omitted, the statement of claim is bad; it is "demurrable" in the old phraseology, and in the new is liable to be "struck out" under Order XXV, r. 4: see Philipps v. Philipps 4 QBD 127; or "a further and better statement of claim" may be ordered under Order XIX, r. 7.
The function of "particulars" under r. 6 is quite different. They are not to be used in order to fill material gaps in a demurrable statement of claim - gaps which ought to have been filled by appropriate statements of the various material facts which together constitute the plaintiff's cause of action. The use of particulars is intended to meet a further and quite separate requirement of pleading, imposed in fairness and justice to the defendant. Their function is to fill in the picture of the plaintiff's cause of action with information sufficiently detailed to put the defendant on his guard as to the case he has to meet and to enable him to prepare for trial. Consequently in strictness particulars cannot cure a bad statement of claim. But in practice it is often difficult to distinguish between a "material fact" and a "particular" piece of information which it is reasonable to give the defendant in order to tell him the case he has to meet; hence in the nature of things there is often overlapping. And the practice of sometimes putting particulars into the statement of claim and sometimes delivering them afterwards either voluntarily, or upon request or order, without any reflection as to the true legal ground upon which they are to be given has become so common that it has tended to obscure the very real distinction between them.
45The distinction between the material facts of the case as pleaded and the particulars provided of those pleaded facts has been recognised in a number of authorities (for example, Rubenstein v Truth and Sportsman Limited [1960] VR 473 at 476 per Adam J; Goldsmith v Sandilands (2002) 190 ALR 370 at 371 [2] per Gleeson CJ; H 1976 Nominees Pty Limited v Galli (1979) 30 ALR 181 per Northrop J; Southern Cross Exploration NL v All Risks Insurance Co Limited (1985) 2 NSWLR 340 at 351, per Waddell J (as his Honour then was); Travel Compensation Fund v Blair [2003] NSWSC 720 at [29]-[30] per Einstein J; Shanmugaratnam v Strasburger Enterprises (Properties) Pty Ltd [2004] NSWCA 229 per Mason P, with whom Santow JA and Cripps AJA agreed).
46However, where, as here, the particulars provided may be liable to confuse the defendants as to what facts are put in issue, then I consider that it is appropriate to make the grant of leave for the repleading of the claim conditional upon the re-particularisation of those paragraphs in which the material facts are pleaded (here, [8] and [9]) so as to remove the scope for confusion. (Insofar as Mr King submits that all the plaintiffs' evidence has been served and that therefore the substance of the second plaintiff's complaint can be identified by reference to that evidentiary material, that does not seem to me to address complaints made as to the content of the pleading or any confusion arising from the particularisation of the pleading.)
47It seems to me that it would be helpful (in minimising confusion and focussing the parties' attention on the precise factual allegations) for there to be a clear distinction between what is particularised as being the activities/conduct of which complaint is made and what is particularised as being the undue disturbance caused by each particular activity or item of conduct.
48As to paragraph [9] (reading this, as Mr King confirmed it was, as a reference to the activities to be alleged in [8]), there is a similar issue to that adverted to earlier (namely, that particular (b) refers to an activity not particularised in the particulars to paragraph [8]). That could again be appropriately dealt with simply by a re-particularisation of the allegations made in the respective paragraphs.
49Mr King submits that the affectations or consequences particularised in [9] (as amounting to the unreasonable disturbance to the second plaintiff's use and enjoyment of the land), namely the noise, dirt, smells, sleep deprivation, access issues and the like, are "slightly different" from the particulars of activities, conduct and undue disturbance that are pleaded as part of the key aspects of the cause of action in [8] because the matters particularised in [9] are the problems caused to Mrs Harris personally (from whence she has her damages claim). It is not clear to me the distinction there sought to be drawn between the particularisation in [8] of activities which have caused "undue disturbance to the second plaintiff in the use and enjoyment of the second plaintiff's land" and that in [9] of the activities that have "unreasonably disturbed the second plaintiff in the use and enjoyment of the second plaintiff's land". By way of example, is it to be understood that the offensive smells and odour particularised in [9(b)] amount to an unreasonable (but not undue) disturbance to the second plaintiff's use and enjoyment of the land?
50Mr King distinguishes between the two paragraphs of the pleading as being that [8] pleads to the basis upon which there has been an undue disturbance in the use and enjoyment of land (as a constituent element of the cause of action) and [9] as pleading to the actual loss and damage caused to Mrs Harris personally (by the said activities). The scope for confusion that arises in my view with the way in which the allegations in [8] and [9] have been particularised is that it is not clear (if that is indeed the distinction between the two paragraphs) whether it is alleged that the undue disturbance to the second plaintiff's use and enjoyment of the land pleaded in [8] is alleged to have caused loss and damage to the second plaintiff for which damages are claimed in these proceedings.
51I note that in relation to each of paragraphs [9], [10] and [11], Mr King confirmed that the reference to activities was a reference to the activities pleaded in paragraph [8].
52As to paragraph [11], this pleads that the activities have involved a substantial interference in the use and enjoyment of the second plaintiff's land. Mr King submitted that there was a difference between the allegation that there has been an "unreasonable disturbance" in the use and enjoyment of the second plaintiff's land (at [9]) and that there has been a "substantial interference" in the use and enjoyment of the second plaintiff's land (and presumably it would also be contended that there is a difference in the allegation that there has been an undue disturbance as alleged in [8]) but informed me that the same activities and the same conduct were relied upon for both allegations. In other words, he confirmed that the pleading is that not only have the activities and conduct of the second and third defendants unreasonably disturbed the second plaintiff in her use and enjoyment of her land, those activities have involved a substantial interference in that use and enjoyment of the land. However, the amended points of claim should make it clear that paragraph [11] allegation is based on the same conduct and activities as the allegation in [9].
53To address the issues raised above, I will direct that particulars be provided within 7 days of the matters the subject to the 31 May 2012 request (other than those now otiose by the deletion of the paragraphs of the pleading to which they relate) and that the Further Amended Points of Claim make clear the concessions referred to above as to the ambit of the allegations in [11].
54If it is clear that the same activities/conduct are being relied upon for both allegations, it seems to me that the effect of the respective allegations is to say that there is a difference between an "unreasonable disturbance" and a "substantial interference". What that distinction is and what flows from it are matters to be explored at the hearing. Suffice it to note that, as so understood, it seems to me that there is no difficulty for the second and third defendants pleading to the separate allegations.
(b) Negligence
55The claim in negligence is pleaded in paragraphs [14]-[19].
56Criticism is made of the particulars to paragraph [15], which alleges that the second and third defendants commenced and carried on hazardous activities on the land, on the basis that: they do not properly particularise the activities relied upon or how they are said to be hazardous; (b), (c) and (d) plead the result of the activity not the activity itself; and (c) and (d) relate to activities outside the land. (As to the last matter, the disturbance and pollution of endangered ecological species adjacent to the land is, as I understand it, said to have resulted from conduct on the land so that I do not think it is necessarily correct to read (c) as relating to activities outside the land.)
57While I consider that there is some force to the criticism that there is no particularisation of how it is said that the activities complained of are hazardous (and that the particulars in (b) and (c), if not also (d), relate to the effect of an unspecified activity and not the activity itself), these are matters that can and should in my view be dealt with by the provision of proper particulars.
58The complaint as to [16]-[18] falls into a different category. It is contended by Mr Menzies that the allegation of negligence fails to meet the requirements of s 5B(1) of the Civil Liability Act 2002 (NSW) as explained in Garzo v Liverpool/Campbell Christian School Limited [2011] NSWSC 292, where Garling J said, from [59]-[61]:
But in a claim in negligence to which the Civil Liability Act applies, it is necessary that the pleading identifies and articulates the material facts upon which the plaintiff relies to establish each of the elements required by s 5B(1).
As a starting point, a proper pleading of a claim requires the plaintiff to identify, and articulate clearly the "risk of harm" in respect of which, it is alleged, the defendant was obliged to take precautions. This puts a court in a position to determine the defendant's knowledge of a specified risk of harm, to assess the probability of that risk occurring, and to evaluate the reasonableness of the defendant's response, or lack of response, to that risk, thereby avoiding the type of error discussed by Gummow J in RTA v Dederer (2007) 234 CLR 330 at [59]-[61].
A proper pleading will also need to plead whether it is part of the plaintiff's case that the defendant had actual knowledge of the risk of harm, and that the risk was thereby foreseeable (s 5B(1)(a)), or whether the plaintiff only contends that the defendant ought to have known of the risk of harm. Particulars of such a pleading would then ordinarily be provided. A defendant would then be in a position to fully plead to such allegation.
59Section 5B of the Civil Liability Act provides:
(1) A person is not negligent in failing to take precautions against a risk of harm unless:
(a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and
(b) the risk was not insignificant, and
(c) in the circumstances, a reasonable person in the person's position would have taken those precautions.
(2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things):
(a) the probability that the harm would occur if care were not taken,
(b) the likely seriousness of the harm,
(c) the burden of taking precautions to avoid the risk of harm,
(d) the social utility of the activity that creates the risk of harm
60Section 5C provides that, in proceedings relating to liability for negligence:
(a) the burden of taking precautions to avoid a risk of harm includes the burden of taking precautions to avoid similar risks of harm for which the person may be responsible, and
(b) the fact that a risk of harm could have been avoided by doing something in a different way does not of itself give rise to or affect liability for the way in which the thing was done, and
(c) the subsequent taking of action that would (had the action been taken earlier) have avoided a risk of harm does not of itself give rise to or affect liability in respect of the risk and does not of itself constitute an admission of liability in connection with the risk.
61Mr King submits that the objection to paragraphs [16]-[18] of the Points of Claim is misconceived on the basis that the conduct complained of was deliberate conduct on the part of the second and third defendants and that, for that reason, s 5B of the Civil Liability Act does not apply.
62Reference is made to what Garling J said at [62] in Garzo:
[62] Authorities suggest that there may be cases where, at least arguably, s 5B may not apply: see Drinkwater v Howarth [2006] NSWCA 222 at [11]-[13]; Refrigerated Roadways at [173]. It is unnecessary for me to express any view in this case as to a resolution of the apparent tension between these remarks and the judgment of the High Court of Australia in Adeels Palace at [27], because this case is one to which s 5B clearly applies, as all the parties accepted.
63Basten JA in Drinkwater v Howarth [2006] NSWCA 222 said at [10] -[13] in relation to s 5B of the Civil Liability Act:
That section was argued to have application to the facts as described above. Whether or not it does may be open to some doubt. It deals with the question of whether a person has been negligent or not "in failing to take precautions against a risk of harm". It may be that where a deliberate act had caused harm that section does not apply.
There must be an issue as to the interrelationship between ss 5B and 3B. Section 3B provides in effect that the provisions of the Act do not apply in respect of an intentional act that is done with intent to cause injury: see State of New South Wales v Ibbett [2005] NSWCA 445 at [5]-[11] (Spigelman CJ), [121]-[129] (Ipp JA) and [206]-[218] (Basten JA).
Her Honour rejected an argument that s 3B applied in the present case because she said there was no intention on the part of the defendants to injure the plaintiff. An intentional act may of course be intentional in the sense that it is intended to injure someone without necessarily being directed towards the plaintiff: an issue may arise as to the application of s 3B in that situation.
The matter has proceeded in this Court on the basis that s 5B applied and it is at least arguable that it does apply to a deliberate act taken without due care. The assumption may be accepted. The argument which is sought to be raised is that the legislature has deliberately removed the concept of a risk which is "not far-fetched or fanciful", as identified in Shirt's case, and replaced it with the concept of a risk that is "not insignificant". A number of questions arise in relation to that variation in the circumstances of the present case.
64Criticism is also made that there is no pleading of the scope and content of the duty of care alleged to have been owed by the second and third defendants. Paragraph [17] simply alleges that, by reason of the foregoing (the carrying on of hazardous activities on the land and the position of the second plaintiff as a person in the contemplation of the second and third defendants as an individual whose property, person, amenity, privacy and interests would be adversely affected by such activities), the second and third defendants were at all material times under a duty of care to the second plaintiff. Mr Menzies notes that there is no identification of what additional precautions it is said that the second and defendants ought to have taken and failed to take (whether generally or by reference to s 5B and 5C of the Civil Liability Act).
65Mr King submitted that in this particular case there had been deliberate conduct by the second and third defendants so as to take the case outside the operation of s 5B. When asked to identify the allegation of deliberate conduct in the pleading, Mr King said that it arose from the nature of the matter. While he suggested that the word "deliberate" might have been inapposite, Mr King nevertheless submitted that the conduct of the second and third defendants was deliberate in that they were building on the land (without regard, it is said, to the second plaintiff's interests) because they thought they had a valid authorisation so to do.
66It was submitted that this is not a case where it is alleged that the second and third defendants were negligent in failing to take precautions against a risk of harm. It seems to me that the argument on this issue squarely indicates the difficulty arising from the failure to plead the nature and scope of the duty of care alleged. The particulars to [18] suggest that the allegation is that there was a failure to take precautions against a risk of harm. Furthermore, if the allegation is that there was an intentional act or intentional tort, then that ought to be clearly identified in the pleading.
67One might perhaps infer, from the conduct pleaded in [18] as amounting to a breach of the duty of care, the scope or part of the scope of the duty of care that has been alleged. However, this should not be a matter for inference (and it seems inconsistent with the submission made by Mr King as to the deliberate nature of the relevant activities).
68It seems to me that paragraph [17] should be repleaded to identify the scope and nature of the alleged duty of care (including by reference to what it is that it is alleged the second and third defendants should have done in order to comply with their alleged duty of care to the second plaintiff) and if any intentional tort is alleged, it should be clearly pleaded.
69Mr Menzies refers in this regard to what was said by Rein J at [95] - [97] of his Honour's judgment:
I turn now to the claim that the School and AFIC have engaged in a "hazardous activity on the land": see paragraph 15 of the Amended Points of Claim. It is true that the defendants have not sought particulars of this allegation, but none are needed, because the plaintiffs have repeated the particulars to paragraph 13. The particulars to paragraph 13 refer to a number of matters, and most of them could not involve any engagement in a hazardous activity, for example, dust, noise and mud intrusions are not capable of amounting to an activity. "[I]ncreased medium crime risk" is not an activity, nor is "loss of amenity".
Further, the tort of negligence is not established by proving that a hazardous activity has been engaged in. It was said in Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at 558-559 per Mason CJ, Deane, Dawson, Toohey and Gaudron JJ:
"The fact that a particular substance or a particular activity can be seen to be "inherently" or "of itself" likely to do serious injury or cause serious damage will, of course, ordinarily make characterization as "dangerous" more readily apparent. That fact does not, however, provide a criterion of what is and what is not dangerous for the purpose of determining whether the duty of a person in occupation or control of premises to take care to avoid injury or damage outside the premises is or is not a delegable one. It suffices for that purpose that the combined effect of the magnitude of the foreseeable risk of an accident happening and the magnitude of the foreseeable potential injury or damage if an accident does occur is such that an ordinary person acting reasonably would consider it necessary to exercise special care or to take special precautions in relation to it."
Where a substance or process is inherently dangerous, the party which has delegated the task to an independent contractor must ensure that its contractor has taken reasonable care to prevent the accident: see Burnie Port Authority at 560 per Mason CJ, Deane, Dawson, Toohey and Gaudron JJ. The duty of care in negligence is not one to ensure a particular result, but to take reasonable care. The second and third defendants' submissions refer to Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330, which emphasises this principle; see also Graham Barclay Oysters Pty Limited v Ryan (2002) 211 CLR 540 at 611-612 per Gummow and Hayne JJ.
70In Garzo, Garling J addressed the need to identify in a pleading of negligence the risk of harm, saying at [63]-[64]:
A central concept and one with which the analysis commences is the identification of "a risk of harm" against which the plaintiff, here Mrs Garzo, alleges a defendant would be negligent for failing to take precautions. Harm in this expression includes personal injury. Gummow J, in Dederer at [59]-[61] clearly demonstrates that it is only through the correct identification of the risk of harm that an assessment of the reasonable response can be made.
As a real and practical matter, where a court is considering any of the essential steps in s 5B(1), it must do so against the identified risk of harm. It is a matter of common experience in common law claims, that in any given set of factual circumstances, there are a number of risks of harm which can be identified. Unless the risk of harm being relied upon is clearly identified then it will not be possible to identify what steps ought reasonably to have been taken by a defendant to address the risk. Nor will it be possible for a court to determine what the application of reasonable care required.
71Mr King submits that the negligence claim in the present case is not a "risk of harm" case of the sort that was dealt with by Garling J in Garzo. That may or may not be the manner in which the plaintiffs intend to argue the case. However, insofar as it is submitted that the risk of harm is clearly pleaded in [15] (though this seems to be said by reference to the particulars not the pleading itself), I disagree. Further, the particulars of breach of duty themselves appear to rely upon a failure to take precautions to bring harm (which would seem inconsistent with the submission that this is not a risk of harm case).
72Complaint is also made as to the pleading of causation in [19] having regard to s 5D of the Civil Liability Act. Section 5D provides:
(1) A determination that negligence caused particular harm comprises the following elements:
(a) that the negligence was a necessary condition of the occurrence of the harm ( "factual causation"), and
(b) that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused ("scope of liability").
(2) In determining in an exceptional case, in accordance with established principles, whether negligence that cannot be established as a necessary condition of the occurrence of harm should be accepted as establishing factual causation, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.
(3) If it is relevant to the determination of factual causation to determine what the person who suffered harm would have done if the negligent person had not been negligent:
(a) the matter is to be determined subjectively in the light of all relevant circumstances, subject to paragraph (b), and
(b) any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest.
(4) For the purpose of determining the scope of liability, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.
73I consider that the allegation of negligence needs to be repleaded to address the above matters.
(c) Negligent trespass
74Insofar as it is noted that the leave to replead that the Court of Appeal considered should be granted did not extend to a claim in negligence, I have treated the present application as a fresh application for leave to amend to include such an allegation. The principles outlined in Aon Risk Services Australia Limited v Australian National University (2009) 258 ALR 14 are applicable on such an application. Given the stage at which the proceedings are, it does not seem to me that there is any real prejudice occasioned by an amendment to plead trespass at this stage and Mr Menzies did not to seek to argue otherwise. (There was not, however, any real explanation for the delay in raising the trespass claim either.)
75Mr Menzies contends that the proposed trespass claim has not been properly particularised. Paragraph [20] (as amended by Mr King during the course of argument) refers to the conduct set forth in 15(a) and (d), namely "disturbing the earth with large earthmoving equipment and conducting excavations and other earthworks causing mudflows from the land onto inter alia the second plaintiff's land" and "blocking or inhibiting access to the second plaintiff's land with street and pathway closures on the land and adjacent to the land". The negligence is pleaded as being "as particularized in paragraph 19" and there is an unparticularised assertion that "whereby the second plaintiff has suffered loss and damage".
76I think there is force in the criticism of the pleading of negligent trespass (even leaving aside the typographical error in the reference to the conduct said to be relied upon as trespass) on the basis that the allegation of negligence is not pleaded (and the only reference is to the particulars in [19] (the allegation of loss and damage) that relate back to the particulars in [10] which deal with the allegation of the effect on the value of the land of the activities in [8]. Paragraph [20] seems to me (with the various internal pleading references incorporated therein) to be convoluted and confusing.
77That said, if the allegation is that conduct causing mudflows onto the second plaintiff's land and/or blocking access to the land amounts to a trespass, then it should be a relatively simple task to replead the paragraph to state that; and to state the basis on which it is said that that conduct was negligent; and to set out the loss and damage said to have been caused thereby. It may be that some of those criticisms can be dealt with by the provision of particulars, rather than amendment to the pleading of the material facts, although it seems to me likely that some re-pleading of the allegation of trespass (beyond a mere re-particularisation of earlier paragraphs of the pleading) is necessary.
Conclusion on pleading amendments
78Mr King submitted (when I raised the issue as to whether there should have been a verified Statement of Claim rather than points of claim) that, this was not raised in the motions before me and that, in effect, the statutory objectives set out in the Civil Procedure Act 2005 (NSW) for the conduct of litigation in this Court were not met by arid arguments about pleadings. I accept that there was no application for the Points of Claim to be replaced by a verified Statement of Claim. However, I do not accept that the application by the second and third defendants for proper particulars and their criticisms of the pleading per se can be so readily dismissed as an arid argument.
79The just, quick and cheap conduct of proceedings in this Court includes reference to what is "just". It seems to me not to be in accordance with s 56 of the Act to permit the filing of pleadings in respect of which issues of the kind raised in respect of the plea in negligence (and negligent trespass) have been raised. If the pleading is to be amended to deal with those matters, then it is not likely to add significantly to the expense of the litigation for any confusion in relation to the particulars to be clarified at the same time.
80Therefore, I consider that the leave to amend should be given subject to further amendment to the proposed amended Points of Claim that were handed up to me in order to address the above issues.
(ii) Security for costs
81The claim for security for costs against the second plaintiff is made invoking the inherent jurisdiction of the Court (and the power in s 67 of the Civil Procedure Act 2005 (NSW) to grant a stay unless security is paid). It is submitted by Mr Menzies that the evidence establishes that Mrs Harris has no significant assets other than her home and would clearly be unable to pay the defendants' costs in the event that she were to be unsuccessful in the proceedings.
82In this regard, reliance is placed on the evidence given by Mrs Harris (when cross-examined in the proceedings before Nicholas J) to the effect that her home is worth $380,000-$400,000 but is the subject of security to the bank for a debt in the order of $212,000) and that her other asset is a motor vehicle worth approximately $14,000. The solicitor acting for the second and third defendants (Ms Janet Lazzaro) has deposed to the costs incurred to date in the proceedings and to the likely future costs to the conclusion of a contested hearing (the latter being in the order of $388,000, albeit based on the assumption of a two to three week hearing). (Mr King informed me that all of Mrs Harris' evidence in relation to the claims against the second and third defendants had been served and that in his opinion the hearing would last only 3 or 4 days - something not tested with Ms Lazzaro in cross-examination.)
83Ms Lazzaro's affidavit of 1 June 2012 deposed to various costs orders made by the Court in these and the Court of Appeal proceedings (though Mr King contends that this is not a complete statement of the various costs orders made). Costs incurred to date are said to be approximately $116,009.19. Ms Lazzaro has estimated costs for the hearing of the present motions as in the order of around $27,170 to $39,270; the costs of preparation for the matter for hearing (assuming the proceedings are not heard as representative proceedings) as in the order of $121,280 to $160,290; and costs for the hearing as in the order of $123,720 to $185,580. Total costs of the proceedings (assuming a 2-3 week hearing) are estimated as in the range of $388,179.19 to $501,149.19. It is the lower end of the range that is sought by way of security at this stage (though Mr Menzies indicated there would be no objection to security being provided on a staged basis).
84Mrs Harris has served no evidence as to her financial position on the security for costs application (Mr King noting that it is for the second and third defendants to establish impecuniosity).
85In Bagnato v Bagnato [2011] NSWSC 1035, Pembroke J recognised (at [23]) that "The general principle that a natural person who sues will not be ordered to give security for costs, however impoverished, is not absolute and is subject to numerous exceptions" (noting that a summary of circumstances in which a court might order that a natural person provide security was provided by Lindgren J in Knight v Beyond Properties Pty Ltd [2005] FCA 764 at [33] and referring also to Barton v Minister for Foreign Affairs (1984) 2 FCR 463; Loque v Hansen Technologies Ltd [2003] FCA 81; Cunningham v Olliver (unreported, Burchett J, 21 November 1994); Chang v Comcare Australia [1999] FCA 1677 at [32]; Morris v Hanley [2000] NSWSC 957; Morris v Hanley & Ors [2001] NSWCA 374 at [30]-[31]) and Melville v Craig Nowlan & Associates (2002) 54 NSWLR 82).
86His Honour expressly adopted the statement by Heydon J in Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd (2009) 239 CLR 75 at 118 [91] that:
Mere impecuniosity is not an absolute barrier to ordering security for costs against a natural person, although it is a factor against doing so. In particular, there are instances additional to those listed in r 42.21(1)(a)-(c) and (e) where it can be done. They include the vexatious conduct of litigation by a plaintiff who had failed to set aside an earlier judgment, instances where the plaintiff has dissipated assets and/or not paid previous costs orders (particularly costs orders in favour of the defendant), instances where the plaintiff brings a weak case to harass the defendant and instances where the plaintiff brings a case for the benefit of others, but not solely for that benefit. Hence the supposed "general principle ... that poverty is no bar to a litigant" is a severely qualified one.
87Mr Menzies submits that relevant factors to be taken into account (other than the asset position of the second plaintiff) are that the second plaintiff still has not properly pleaded her claim (citing Fitzsimons v Commonwealth Bank of Australia [2011] NSWSC 1475); that the costs to date and further costs are likely to be significant; that the second and third defendants are private bodies; that there is little utility in the proceedings given that the orders made in March 2012 in the Land and Environment Court restraining any further building work; and that no acts on the part of the second and third defendants could be said to have contributed to the impecuniosity of the second plaintiff.
88(Submissions were made as to the representative nature of the proceedings and the persons standing behind the plaintiffs who might benefit from the litigation and might reasonably be expected to make funds available for security or otherwise agree to bear any adverse costs order. However, in light of the confirmation by Mr King that no claim is made against the second and third defendants by the first plaintiff or in a representative capacity by the second plaintiff, issues of that kind are no longer of relevance to the issue of security for costs by the second plaintiff for her personal claim against the second and third defendants.)
89The fundamental purpose of an order for the provision of security for costs is to secure justice between the parties. In KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 56 FCR 189; 13 ALC 437 it was made clear that an application for security for costs is not to be approached with any predisposition in favour of the award of security. The discretion to order security for costs is recognised as being wide and as one that should be exercised having regard to all the circumstances of the particular case in which security is sought.
90The principles to be taken into account on applications for security for costs were set out by Beazley JA in Meltglow. Those include: the promptness with which the application is brought; the strength and bona fides of the plaintiff's case (including whether a costs order is likely to be made at the conclusion of the litigation); whether the plaintiff's impecuniosity has been caused by the defendant's conduct the subject of the plaintiff's claim; whether the application for security is being used to deny an impecunious plaintiff the right to litigate; whether there are any persons standing behind the plaintiff who are likely to benefit and who are willing to provide security; whether the persons standing behind the plaintiff have offered any undertaking for the costs; whether the plaintiff is in substance a plaintiff; and the public interest, if any, in the litigation.
- Promptness/delay
91Mr King submits that the delay in seeking security is fatal to the present application. As Beazley JA in Meltglow noted, applications of this kind should be brought promptly. However, delay is not an automatic bar to the making of the order for security for costs (Commonwealth v Cable Water Skiing (Aust) Ltd (1994) 14 ACSR 760). Of relevance is the length of, and reasons for, the delay (consideration also being given to what has taken place in the interim).
92The relevance of the promptness with which a party acts to seek security is that a plaintiff is entitled to know its position in relation to the security before it embarks to any real extent to its litigation and before it is allowed to commit substantial sums of money towards litigating its claim (see Moffitt P in Buckley v Bennell Design & Construction Pty Ltd (1974) 1 ACLR 301). French J (as his Honour then was) in Bryan E Fencott & Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497 indicated that the further a plaintiff has proceeded in an action, and the greater the costs it has been allowed to incur without steps being taken to apply for an order for security for costs, the more difficult it will be to persuade the court that such an order is not, in the circumstances, unfair or oppressive.
93In the present case, while the proceedings have not yet advanced beyond the pleading stage, significant steps have been taken by the second plaintiff in the context of defending the dismissal application, bringing the application for leave to appeal and bringing the application of interlocutory relief (albeit that this was rendered otiose by the outcome of the Land and Environment proceedings).
94Cross-examined by Mr King as to the explanation for the delay, the second and third defendants' solicitor's evidence was, in effect, that she had no instructions to bring such an application at the earlier times when Mr King submits that the application could have been made (namely, when the matter was before Rein J, the Court of Appeal or Nicholas J).
95In response to the submission as to delay, Mr Menzies noted that initially the second and third defendants had attempted to ensure that there were proper pleadings and that the strike-out application proceeded upon the basis that that would either solve the problem in large measure or bring the proceedings to an end. It was submitted that the issue of security for costs would probably not have arisen at all had the matter been re-pleaded promptly at the start.
96I accept that there may well have been sound reasons for proceeding first with the dismissal application (rather than bringing an application for security for costs by way of an alternative application at that time). However, even though that may have been a sound forensic decision at the time, it nevertheless seems to me to have implications for the application now made for security for costs since, in the meantime, Mrs Harris has taken a number of not insubstantial steps in the proceedings.
- Strength and bona fides of claim
97The second factor referred to in Meltglow is the strength and bona fides of the case.
98Mr King submits that the prospects of success on the present claim are high (but seems to base this on the finding that the development consent was invalid). He also maintains that the allegations made are serious complaints (referring to an earlier affidavit of Mrs Harris in which the nature of the complaints was disclosed).
99I do not consider that I am in a position to form a view one way or another on whether the allegations of private nuisance, negligence or trespass will be made out. However, it has been said that, as a general rule, where a claim is prima facie regular on its face and discloses a cause of action then in the absence of evidence to the contrary the court should proceed on the basis that the claim is bona fide with a reasonable prospect of success (Meltglow; Bryan E Fencott) without attempting a more detailed assessment of the prospects of success (Fiduciary Ltd v Morningstar Research Pty Ltd [2004] NSWSC 664; (2004) 208 ALR 564 at [37]-[39]).
100For the purposes of the security for costs application I accept that there are arguable causes of action in relation to the claims of private nuisance, negligence and trespass and that there is nothing to suggest that these have not been brought bona fide.
- Leave be granted to the plaintiffs further to amend the plaintiffs' Third Amended Summons by the filing within 7 days of a Further Amended Summons in the form handed up on 27 August 2012 but with the amendment adverted to in [20] of these reasons.
- Leave be granted to the plaintiffs further to amend the plaintiffs' Further Further Amended Points of Claim by the filing within 7 days of Further Amended Points of Claim in the form handed up on 27 August 2012 but with the amendments adverted to in [21] of these reasons.
- Direct that the second plaintiff provide (and the leave granted in 2 above is conditional upon the provision) to the second and third defendants, within 7 days, of the particulars requested in the letter dated 31 May 2012 from the solicitors acting for the second and third defendants to the solicitors acting for the plaintiffs (other than in respect of paragraphs of the Further Further Amended Points of Claim deleted from the version of the Points of Claim for the filing of which leave was sought on 27 August 2012).
- Second and third defendants' application for security for costs be dismissed (without prejudice to any later application that these defendants might bring for security for costs).
- Each of the plaintiffs, on the one hand, and the second and third defendants, on the other, bear her or its own costs of the respective Notices of Motion filed on 1 June 2012 insofar as those Notices of Motion seek relief as between those parties.
- The first plaintiff pay the costs of the second and third defendants of the claims brought by it against them in public nuisance (which claims are no longer pressed against the second and third defendants).
- Liberty to the second and third defendants to apply for a variation of order 2 in the event that there is non-compliance with order 3 or it is contended that the Further Amended Points of Claim as filed are not in a form complying with the leave as granted.
117As indicated above, I will hear Counsel's submissions before finalising the terms of the above proposed orders.