The tort of collateral abuse of process
32The case of Grainger v Hill (1838) 4 Bing (NC) 212; 132 ER 769 is the first in which the tort of collateral abuse of process was recognised and relief in damages was held to be available upon proof of its elements, including special damage. It is instructive to examine the circumstances of that case.
33The plaintiff, who owned and operated a vessel, had borrowed money from the defendants upon the security of a mortgage of the ship. He was allowed to retain the vessel and its register so that he could continue to conduct his business. A few months after the loan was made and some time before it was repayable, the defendants decided that they should have the money back. They contrived a means of obtaining possession of the register so that the plaintiff could no longer use the vessel. They did this by commencing an action of assumpsit and procuring the issue of a writ of capias ad respondendum which was indorsed for bail in the sum of £95.17s.6d and directed the sheriff to arrest the plaintiff and bring him to court. The defendants arranged for two sheriff's officers to take the writ to the plaintiff who was ill in bed. The officers told the plaintiff that they did not wish to apprehend him and were seeking to obtain the ship's register. They also said that, if he did not give them the register or find bail, they would either arrest him or leave him in the custody of one of the officers. He could not provide bail and, after being imprisoned for twelve hours and "being much alarmed", gave up the register. He later came to an accommodation with the defendants, was released from arrest, paid the costs, repaid the loan and retrieved the register. No further steps were taken in the defendants' assumpsit action.
34The plaintiff brought proceedings against the defendants on two causes of action: one for the loss occasioned by inability to carry on business because of the defendants' taking of the ship's register; and the other in trover in respect of the taking of the register. A verdict was given for the plaintiff at trial. The defendants applied for a non-suit on several grounds, including that the former action did not lie unless the writ of capias had been issued without reasonable and probable cause, which had not been pleaded and could not be established without showing that the assumpsit action had concluded in a judgment against the defendants.
35The Court of Exchequer Chamber dismissed the application for a non-suit. Tindal CJ held (at ER 773) that it was not necessary to prove the termination of the assumpsit proceedings and the absence of reasonable and probable cause for those proceedings. This was because the action was not one for malicious arrest or malicious prosecution. He said that the action was, rather, "for abusing the process of the law, by applying it to extort property from the Plaintiff". The demands made of the plaintiff to compel him to give up the register were not part of the duty imposed by the writ of capias. The complaint of the plaintiff was "that the process of the law has been abused, to effect an object not within the scope of the process".
36Park J said (also at ER 773) that the case was not one of malicious arrest, but "a case primae impressionis, in which the Defendants are charged with having abused the process of the law, in order to obtain property to which they had no colour of title". He said that the compulsion under which the register was detained was tantamount to a conversion. Vaughan J said (at ER 774) that the plaintiff's complaint was of "an abuse of the process of law, for the purpose of extorting property to which the Defendants had no claim", and that, as to the claim in trover in respect of the register, the "taking was as much a forcible taking as if a pistol had been presented to the Plaintiff's head". Bosanquet J said (at ER 774) that the action was not one of malicious arrest or prosecution, or for maliciously doing that which the law allows to be done - rather, "the process was enforced for an ulterior purpose; to obtain property by duress to which the Defendant had no right". The action was "not for maliciously putting process in force, but for maliciously abusing the process of the Court"; and "the register was illegally obtained by duress, under an abuse of the process of the Court". Tindal CJ and Park J expressly acknowledged that there was no precedent for the cause of action of abuse of process on which the plaintiff succeeded.
37Grainger v Hill is regarded as having set the parameters within which relief in damages for tort may be awarded in case of abuse of process. In conformity with the approach there adopted, the High Court has regarded the purpose of the party instituting the proceedings as of crucial importance. In Varawa v Howard Smith & Co Ltd [1911] HCA 46; 13 CLR 35, the plaintiff alleged that the defendant company had instituted proceedings for breach of contract and procured the issue of a writ of capias ad respondendum pursuant to which the plaintiff was arrested with the intention of coercing him into paying the defendant money to which it was not entitled. The allegations were found not to have been proved, but the Court recognised the existence of the tort of collateral abuse of process. Griffith CJ referred (at 55) to the abuse in Grainger v Hill as being "a use of original process for purposes foreign to the scope of the process itself, that scope being merely to obtain security for enforcing the payment of an alleged debt". Isaacs J observed (at 91) that the term "abuse of process", in the relevant context, "connotes that the process is employed for some purpose other than the attainment of the claim in the action". Isaacs J also said:
"If the proceedings are merely a stalking-horse to coerce the defendant in some way entirely outside the ambit of the legal claim upon which the Court is asked to adjudicate they are regarded as an abuse of process for this purpose".
38The distinction was elaborated in Dowling v Colonial Mutual Life Assurance Society Ltd [1915] HCA 56; 20 CLR 509. Isaacs J there said (at 522):
"Where it can be shown in a case of insolvency that the creditor is making his application not intending to pursue it to a recognized lawful end - whatever his motive may be for attaining that lawful end - but for the real purpose of attaining some other and improper end, such as extorting money as in Davies' Case [Re Davies; Ex parte King (1876) 3 Ch D 461] where the petition was hung up while in existence and used as a means of extortion, there is an abuse of process."
39But, as in Dowling's case itself, there is no abuse if the process of the court is employed with a view to producing the result that that process exists to produce, even though the motive for seeking that result is to use it as a platform from which to launch some lawful action that becomes available through the obtaining of it.
40Williams v Spautz [1992] HCA 34; 174 CLR 509 was a case in which the court was asked to stay proceedings as an abuse and thereby to preserve the integrity of its own functions. A question canvassed but not directly relevant to the matters in issue was whether an essential element of the allied tort is an improper act of the defendant which is distinct from resort to the court's process itself and which occasions damage to the plaintiff - in Grainger v Hill, the demand for the register to which there was no entitlement and use of the writ of capias (and the control the defendants had over its execution and enforcement) to achieve that end with a view to coercing early repayment of the money lent.
41Dealing with the notion of abuse as relevant to the protection of the court's own process, Mason CJ, Dawson, Toohey and McHugh JJ said (at 527) that decided cases did not insist on the need for an improper act as an ingredient in the concept of abuse of process but did "speak of the 'use' of process for a purpose which stamps it as an abuse". They went on to say (at 528), in relation to the tort of collateral abuse of process, that "it is perhaps understandable that emphasis has been given to the need for an improper act which occasions damage to the plaintiff". They continued:
"At least in the United States, as the judgment in Rosemont Enterprises Inc v Random House Inc pointed out [(1966) 261 F Supp, at p 695. See also Stromberg v Costello (1978) 456 F Supp 848; Curiano v. Suozzi (1984) 469 NE 2d 1324, at pp 1326-1327] '[t]he gist of the action for abuse of process lies in the improper use of process after it is issued' (emphasis added)."
42Brennan J (at 539) expressed his general concurrence with the majority on that matter.
43Deane J (at 551-552) took a similar view of the elements of the tort. He expressed agreement with the conclusion reached by Priestley JA in this Court (Spautz v Gibbs (1990) 21 NSWLR 230) that the tort "necessarily involves some collateral overt or extraneous act" as distinct from "the mere institution of proceedings, however well-founded, for some 'improper' subjective purpose", adding:
"It is that collateral overt or extraneous act, and not the initiation of the proceedings themselves, which constitutes the 'collateral abuse' for the purposes of the tort. As Samuels AP commented in United Telecasters Sydney v. Hardy [(1991) 23 NSWLR, at p 343); Meagher and Clarke JJA agreeing (at p 348)], the 'gravamen of the action is the use of a process; not simply an improper subjective purpose'. The collateral overt or extraneous act may, in my view, be committed before the initiation of the relevant proceedings provided its effect persists at the time when the proceedings commence."
44Gaudron J (at 552) was of the same opinion, referring to "the tort of collateral abuse of process which, I am inclined to think, requires some act amounting to a misuse or attempted or threatened misuse of the process involved".
45In Butler v Simmonds Crowley & Galvin [1999] QCA 475; [2000] 2 Qd R 252, the Queensland Court of Appeal addressed the issue whether the ingredients of the tort of collateral abuse of process exceed those that must be proved where abuse is asserted as a basis for removing a party's right to continue to have the benefit of the court's process. The question was whether the plaintiff in a tort case must prove a separate and improper act of the defendant, over and above resort to the court's process. After reviewing relevant case law and, in particular, obiter dicta in this Court in Spautz v Gibbs (above), McMurdo P, Pincus and Thomas JJA answered that question in the affirmative. They said (at [38]):
"Our primary view then is that an improper act in the prosecution of the process is a necessary element in establishing a right to damages for the tort of collateral abuse of process. Priestley and Meagher JJA in Spautz v Gibbs, although held to be incorrect in treating this as an element necessary for obtaining a stay of proceedings, were in our respectful view correct in identifying such a requirement in the tort cases. Such an act will usually be found, as Gaudron J's analysis suggests, in the form of an overt act such as a demand which identifies the true collateral purpose. No such allegation is made by the appellants, and none is foreshadowed despite adequate opportunity extended to the applicants to indicate any additional facts upon which they might wish to rely. In the absence of some concrete additional factor of this kind, any disgruntled unsuccessful litigant could proliferate litigation by proceeding to sue the successful adversary, basing the claim on mere occurrence of the earlier litigation with an added assertion of improper motive or absence of legitimate purpose in bringing or defending the proceedings. There is much to be said for recognising a rule that a plaintiff wishing to obtain damages by reason of someone else's successful pursuit of proceedings should be required to allege and show something more substantial than a predominant collateral purpose."
46Like observations were made by McMurdo P (Moynihan and Dutney JJ concurring) in Paradise Grove Pty Ltd v Stubberfield [2001] QCA 117, as follows:
"The tort arises out of the misuse of the court's process, no matter how properly obtained, for any purpose other than which it was designed to serve. It is immaterial whether the action commenced was founded on reasonable cause or even terminated in favour of the instigator. The gravamen of the offence [sic] is the use of the action for improper purposes. See Fleming, The Law of Torts, 8th Ed, 622-624.
In addition to the improper purpose, there must be some overt act or threat distinct from the proceedings themselves in furtherance of that purpose, for were it otherwise, any legal process could be challenged on account of its hidden agenda."
47The Queensland Court of Appeal returned to this matter briefly in The Beach Club Port Douglas Pty Ltd v Page [2005] QCA 475; [2006] 1 Qd R 307. McPherson JA, with the concurrence of Jerrard JA and Chesterman J, referred (at [14]), in the abstract, to the availability of redress in tort to someone prosecuted without reasonable and probable cause and continued:
"It will do you no good to resort to the tort of collateral abuse of process unless you are able to show that the proceedings, if civil, were instituted with an improper motive: Williams v Spautz (1992) 174 CLR 509; and (in Queesland) that they involved an improper act in prosecution of those proceedings: Butler v Simmons Crowley & Galvin [2000] 2 Qd R 252." (emphasis added)
48Statements in this Court are to the same effect. In Hanrahan v Ainsworth (1990) 22 NSWLR 73, an exhautive review of the decided cases undertaken by Clarke JA led him to the following conclusion (at 120):
"The tort of abuse of process is concerned with the use to which
proceedings are put. The intentions or motives of the person who sets the proceedings in motion are relevant only if put into effect. It is the use of the process to effect an improper purpose that is the gist of the action." (emphasis added)
49Priestley JA (Meagher JA concurring) reached the same conclusion in Spautz v Gibbs (above). Particular reference may be made to Priestley JA's discussion of United States cases at 279-280 and their requirement that there be some "actual use" of the legal proceeding otherwise than for its proper purpose. There was thus emphasis of the need to find that the proceeding was "used" in some way distinct from merely producing the result that it would in the ordinary course achieve, if prosecuted to a successful conclusion.
50In England, acceptance of the tort of collateral abuse of process has been, at best, hesistant. It was pointed out in Land Securities plc v Fladgate Fielder [2009] EWCA Civ 1402; [2010] Ch 467 that proceedings had been successfully brought on only two occasions, first in Grainger v Hill and then some 23 years later in Gilding v Eyre (1861) 10 CB (NS) 592; 142 ER 584 and that the claim in the later case was somewhat differently pleaded and involved malice. In Crawford Adjusters v Sagicor General Insurance (Cayman) Ltd [2013] UKPC 17; [2013] 3 WLR 927, an appeal from the Cayman Islands, the Privy Council recognised the tort and several of their Lordships made observations about its scope. In that litigation, both the trial judge and the intermediate appeal court had found against the tort claimant because the defendant had not used the facility of bringing the particular legal action in order to obtain an object for which that action was not designed. The main issues concerned malicious prosecution and only three of the five members of the Board dealt in any depth with the alternative of collateral abuse of process. Lord Wilson and Lord Sumption referred to the question whether a tort claimant must prove an overt act or threat of the defendant going beyond initiation and prosecution of the proceeding. Each of them took note of what had been said in Williams v Spautz and concluded that that the supposed requirement is in truth no more than recognition of the need for proof of improper purpose. Lord Wilson said (at [66]):
"If the rationale behind the suggested need for proof of an overt act or threat is no more than that, in its absence, the defendant in an application for a stay, or indeed a claimant in an action based on the tort, might fail to establish that the other party's purpose had been improper, it would readily be understandable. But, insofar as in some quarters the overt act or threat has taken root not just as having likely evidential importance but as being a substantive requirement, whether for the defendant's application or for the claimant's tort, I struggle to understand the reason for it."
51Lord Sumption said (at [155]):
"It is sometimes said, for example in Fleming, The Law of Torts, 10th ed (2011), 708, that in addition to the extraneous purpose, it is necessary to prove some 'overt act' other than the proceedings themselves, such as the extortionary threat in Grainger v Hill. The better view, however, is that this is not an additional requirement but merely evidence of the extraneous purpose. . . . In the great majority of cases, an overt act may be the only way of proving the abuse. But it is not a legal element of the tort."
52The New Zealand Court of Appeal, in Gordon v Treadwell Stacey Smith [1996] NZCA 110; [1996] 3 NZLR 281, accepted the analyses by Clarke JA in Hanrahan v Ainsworth (above) and Priestley JA in Spautz v Gibbs (above) and said:
"The tort is not committed merely by the issuance of proceedings on a false basis or for an improper purpose."
53In Canada (with the possible exception of British Columbia: Smith v Rusk [2009] BCCA 96; 91 BCLR (4th) 106), proof of an overt act or threat beyond mere initiation and prosecution of the suit is an element of the tort. A survey of the case law to 2007 may be found in an article by Justice Perell of the Ontario Superior Court of Justice: Paul Perell, "Tort Claims for abuse of process" (2007) 33 The Advocates' Quartely 193.
54Particularly in light of what was said by the Queeensland Court of Appeal in Butler v Simmonds Crowley & Galvi (and confirmed in Paradise Grove Pty Ltd v Stubberfield and Beach Club Port Douglas Pty Ltd v Page) by way of endorsement and adoption of statements of judges of this Court in Hanrahan v Ainsworth and Spautz v Gibbs, reinforced by clear and obviously considered dicta of members of the High Court in Williams v Spautz, this Court must, I think, proceed on the footing that a plaintiff in a tort action for collateral abuse of process is required to prove, in addition to improper purpose of the defendant, deployment of the relevant process, in furtherance of that purpose, by way of an overt act or threat distinct from pursuit of the proceeding itself according to its ordinary course.