The Relevant Legal Principles
34 In the present case, MCI relies upon r 39.05 FCR. In particular, it relies upon subr (c) which provides that the Court may vary or set aside a judgment or order after it has been entered if the order is interlocutory.
35 Rule 39.05 FCR provides that:
39.05 Varying or setting aside judgment or order after it has been entered
The Court may vary or set aside a judgment or order after it has been entered if:
(a) it was made in the absence of a party; or
(b) it was obtained by fraud; or
(c) it is interlocutory; or
(d) it is an injunction or for the appointment of a receiver; or
(e) it does not reflect the intention of the Court; or
(f) the party in whose favour it was made consents; or
(g) there is a clerical mistake in a judgment or order; or
(h) there is an error arising in a judgment or order from an accidental slip or omission.
36 As MCI has relied upon r 39.05, I will assume that it is the appropriate rule to be considered in the present case.
37 In Autodesk Inc v Dyason [No 2] (1993) 176 CLR 300 (Dyason), the unsuccessful respondents in an appeal to the High Court applied to that Court after judgment in the appeal had been delivered on the ground that, without fault on their part, they had had no opportunity to be heard on three issues involved in or decided by the Court in the appeal.
38 In his judgment, Dawson J held that, contrary to the respondents' submissions, the unsuccessful respondents had been given a reasonable opportunity of addressing the issues about which they now sought to complain.
39 At 317, Dawson J said:
Whilst the Court has jurisdiction to entertain an application to vacate orders which it has made, at all events before those orders have been perfected by the entry of judgment [cf. University of Wollongong v. Metwally [No.2] (1985), 59 A.L.J.R. 481, at p. 482; 60 A.L.R. 68, at p.70] (that not having occurred in this case), it is a jurisdiction to be exercised cautiously, bearing in mind the public interest in the finality of litigation [See State Rail Authority of N.S.W. v. Codelfa Construction Pty. Ltd. (1982), 150 C.L.R. 29, at pp. 38, 45-46]. In Wentworth v. Woollahra Municipal Council [(1982) 149 C.L.R. 672, at p. 684], the Court said:
"[T]he circumstances in which this Court will reopen a judgment which it has pronounced are extremely rare. The public interest in maintaining the finality of litigation necessarily means that the power to reopen to enable a rehearing must be exercised with great caution. Generally speaking, it will not be exercised unless the applicant can show that by accident without fault on his part he has not been heard."
And it should be added that even though a party fails to present his case in a manner which is open on the pleadings and on the facts, a final appellate court with responsibility to determine the law cannot be precluded from disposing of a case upon the basis which appears to it to be correct. This is particularly so where matters not raised on appeal have been raised in the courts below. "Judges are more than mere selectors between rival views - they are entitled to and do think for themselves." [Saif Ali v. Sydney Mitchell & Co., [1980] A.C. 198, at p. 212, per Lord Wilberforce.]
40 Justice Brennan, who was also in the majority, expressed the relevant law in the following terms (at 308):
This Court has undoubted jurisdiction to recall a judgment which it has pronounced, at least prior to the formal entry of the judgment, if the judgment has been pronounced against a person who, without fault on the part of that person, has not had an opportunity to be heard as to why that judgment should not be pronounced [State Rail Authority of N.S.W. v. Codelfa Construction Pty. Ltd. (1982), 150 C.L.R 29; Wentworth v. Woollahra Municipal Council (1982), 149 C.L.R. 672, at p. 684]. The jurisdiction is exercised sparingly for it is important to bring litigation to finality in this Court [The approach of Courts from which an appeal lies is not so strict, for it may be preferable to recall an unperfected but erroneous judgment rather than allow it to stand until it is quashed on appeal: see, e.g., In re Harrison's Share under a Settlement, [1955) Ch. 260, at pp, 282-284]. Nevertheless, natural justice would be denied if, in a case in which the stated conditions are satisfied, the judgment were not vacated.
It is desirable to add in the context of the present case a further observation about the opportunity to be heard. A court should not pronounce a judgment against a person on a ground which that person has not had an opportunity to argue [Pantorno v. The Queen (1989), 166 C.L.R. 466]. However, a sufficient opportunity to argue a ground is given when the ground is logically involved in a proposition that has been raised in the course of argument before the court or is to be considered by the court as an unconceded step in determining the validity of a conclusion for which one of the parties contends [University of Wollongong v. Metwally [No.2) (1985), 59 A.L.J.R. 481, at p. 483; 60 A.L.R. 68, at p. 71]. Of course, the precise ground which a court or judge assigns for a decision will frequently be formulated in terms different from the terms of a submission by counsel but, provided the ground has arisen in one of the ways mentioned, the court or judge may properly proceed to judgment without requiring the case to be relisted for further argument and without inviting supplementary submissions to be made.
41 His Honour continued (at 309-310):
It is one thing to reopen an appeal after judgment if the Court has reached a conclusion by adopting a proposition of fact or law which the unsuccessful party has not had an opportunity to argue. In that event, natural justice is denied and it can be said that the Court's jurisdiction to hear and determine the matter is not exhausted. But that is not the present case. Here the ground on which the appeal was determined had been argued in the courts below and had been the subject of submissions in this Court. The appeal was determined after it was fully heard. That being so, I find no jurisdiction to set aside the judgment already pronounced merely because it is submitted by the unsuccessful party that, on further argument, the Court would be satisfied that it had reached the wrong conclusion in law. In University of Wollongong v. Metwally [No. 2] [(1985) 59 A.L.J.R., at p. 483; 60 A.L.R., at p. 71. Similarly, it has been held that a party may be shut out from raising a claim or defence if that party, through negligence, inadvertence or even accident has failed to raise that claim or defence in prior proceedings when the failure was unreasonable: Port of Melbourne Authority v. Anshun Pty. Ltd. (1981), 147 C.L.R. 589, at pp. 598, 602] this Court said:
"Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so."
The decision of this Court in the present case was not given in ignorance or forgetfulness of some statutory provision [The kind of mistake which might make a decision per incuriam. Cf. Morelle Ltd. V. Wakeling, [1955] 2 Q.B. 379, at p. 406] or of some critical fact. To entertain an application to reopen an appeal after judgment in order to consider further argument on an issue already decided would be to subvert the finality of litigation and to invite interminable arguments about the importance of the legal questions to be recanvassed and the correctness of the answers to those questions already given.
42 Justice Gaudron, the third member of the majority in Dyason, commenced her judgment with the following remarks (at 322):
This is an application by the unsuccessful respondents in Autodesk Inc. v. Dyason [(1992) 173 C.L.R. 330] ("Autodesk No. 1") ("the respondents") to vacate the judgment given in that matter on the ground that, without fault on their part, they had no opportunity to be heard on three issues involved in or decided by it. Judgment has not yet been entered and, in my view, should be set aside if the interests of justice so require [Smith v. N.S.W. Bar Association (1992), 176 CL.R 256]. However, the circumstances in which justice requires that course are, in practice, extremely rare, particularly if there has been an opportunity for full argument [Wentworth v. Woollahra Municipal Council (1982), 149 CL.R. 672, at p. 684; State Rail Authority of N.S.W v. Codelfa Construction Pty. Ltd. (1982), 150 C.L.R. 29, at pp. 38, 48]. In order to make clear my reasons for holding that the interests of justice do not require that course in this case, it is necessary for me to repeat, at least to some extent, the facts involved in Autodesk No. 1.
43 Although dissenting in the result, Mason CJ said the following (at 301-303):
… The exercise of the jurisdiction to reopen a judgment and to grant a rehearing is not confined to circumstances in which the applicant can show that, by accident and without fault on the applicant's part, he or she has not been heard. It is true that the jurisdiction is to be exercised with great caution [Wentworth v. Woollahra Municipal Council (1982), 149 C.L.R. 672, at p. 684; State Rail Authority of N.S.W. v. Codelfa Construction Pty. Ltd. (1982), 150 C.L.R. 29, at p. 38], having regard to the importance of the public interest in the finality of litigation. It is equally true, as this Court said in Wentworth v. Woollahra Municipal Council [(1982) 149 C.L.R., at p. 684], that "[g]enerally speaking, it will not be exercised unless the applicant can show that by accident without fault on his part he has not been heard."
But these statements do not exclude the exercise of jurisdiction to reopen a judgment which has apparently miscarried for other reasons, at least when the orders pronounced have not been perfected by the taking out of formal orders. So much was acknowledged by Brennan, Dawson, Toohey and Gaudron JJ. in Smith v. N.S.W. Bar Association [(1992) 176 C.L.R. 256 at pp. 264-266] when their Honours said: "if reasons for judgment have been given, the power is only exercised if there is some matter calling for review." It is sufficient to give three examples. In In re Harrison's Share under a Settlement [[1955] Ch. 260], orders were set aside following a decision of the House of Lords which overruled authorities on the basis of which the orders had been made. In New South Wales Bar Association v. Smith [Unreported, 4 July 1991], the New South Wales Court of Appeal reconsidered orders previously made in view of an argument that the Court had mistakenly assumed that particular evidence had not been given at earlier hearings [The Court of Appeal refused to set aside its orders but an appeal to this Court was successful]. And, in Pittalis v. Sherefettin [[1986] Q.B. 868], a judge recalled orders the day after they were made upon determining that he had "erred in a material matter in his approach to the case" [ibid., at p. 880. The Court of Appeal upheld the decision to review the matter, though disagreeing with the judge's ultimate conclusion].
These examples indicate that the public interest in the finality of litigation will not preclude the exceptional step of reviewing or rehearing an issue when a court has good reason to consider that, in its earlier judgment, it has proceeded on a misapprehension as to the facts or the law. As this Court is a final court of appeal, there is no reason for it to confine the exercise of its jurisdiction in a way that would inhibit its capacity to rectify what it perceives to be an apparent error arising from some miscarriage in its judgment. However, it must be emphasized that the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the Court; nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put. What must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing. The purpose of the jurisdiction is not to provide a backdoor method by which unsuccessful litigants can seek to reargue their cases.
44 In Aktas v Westpac Banking Corporation Ltd [No 2] (2010) 241 CLR 570 at 573 [6], the High Court (French CJ, Gummow and Hayne JJ) said:
As Mason CJ rightly said in Autodesk Inc v Dyason [No 2] [(1993) 176 CLR 300 at 301-302], the exercise of the jurisdiction to reopen a judgment and to grant a rehearing "is not confined to circumstances in which the applicant can show that, by accident and without fault on the applicant's part, he or she has not been heard". The jurisdiction is, however, to be exercised with great caution [Autodesk Inc v Dyason [No 2] (1993) 176 CLR 300 at 302; Wentworth v Woollahra Municipal Council (1982) 149 CLR 672 at 684; State Rail Authority (NSW) v Codelfa Construction Pty Ltd (1982) 150 CLR 29 at 38], having regard to the importance of the public interest in the finality of litigation. That Mason CJ dissented in the result in that case does not deny the accuracy of the propositions just made.
45 The discretion to reopen a judgment or order must be exercised with great caution. Exceptional circumstances must be shown. The discretion will be rarely exercised (see Metwally v University of Wollongong (1985) 60 ALR 68 at 71-72).
46 In D'Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1 at 17-18 [34]-[35], the plurality (Gleeson CJ, Gummow, Hayne and and Heydon JJ) said:
Finality
A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances. That tenet finds reflection in the restriction upon the reopening of final orders after entry [DJL v Central Authority (2000) 201 CLR 226] and in the rules concerning the bringing of an action to set aside a final judgment on the ground that it was procured by fraud [DJL v Central Authority (2000) 201 CLR 226 at 244-245 [35]-[38]]. The tenet also finds reflection in the doctrines of res judicata and issue estoppel. Those doctrines prevent a party to a proceeding raising, in a new proceeding against a party to the original proceeding, a cause of action or issue that was finally decided in the original proceeding [See, eg, Hoysted v Federal Commissioner of Taxation (1925) 37 CLR 290; Blair v Curran (1939) 62 CLR 464; Jackson v Goldsmith (1950) 81 CLR 446; Administration of Papua and New Guinea v Daera Guba (1973) 130 CLR 353]. It is a tenet that underpins the extension of principles of preclusion to some circumstances where the issues raised in the later proceeding could have been raised in an earlier proceeding [Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589].
The principal qualification to the general principle that controversies, once quelled, may not be reopened is provided by the appellate system. But even there, the importance of finality pervades the law. Restraints on the nature [Victorian Stevedoring and General Contracting Co Pty Ltd v Dignan and Meakes (1931) 46 CLR 73] and availability of appeals, rules about what points may be taken on appeal [Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; O'Brien v Komesaroff (1982) 150 CLR 310; Coulton v Holcombe (1986) 162 CLR 1] and rules about when further evidence may be called in an appeal (in particular, the so called "fresh evidence rule" [Orr v Holmes (1948) 76 CLR 632; Ratten v The Queen (1974) 131 CLR 510 at 516-517 per Barwick CJ; Gallagher v The Queen (1986) 160 CLR 392; Mickelberg v The Queen (1989) 167 CLR 259]) are all rules based on the need for finality. As was said in the joint reasons in Coulton v Holcombe [(1986) 162 CLR 1 at 7]: "[i]t is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at the trial".
47 To similar effect were the statements of the plurality (Toohey, Gaudron, McHugh, Gummow and Kirby JJ) in De L v Director-General, New South Wales Department of Community Services [No 2] (1997) 190 CLR 207 at 215 and the observations of McLelland J in Brimaud v Honeysett Instant Print Pty Ltd (1988) 217 ALR 44 at 46-47 where his Honour said:
The private injustice and public undesirability of permitting the relitigation of matters already litigated once is recognised in a number of principles of law, notably the rules relating to res judicata and issue estoppel, the more flexible rules under the rubric of vexation and abuse of process illustrated in such cases as Stephenson v Garrett [1891] 1 QB 677 and Hunter v Chief Constable, West Midlands Police [1982] AC 529; [1981] 3 All ER 727, and the restrictive provisions governing the adducing of further evidence on the hearing of an appeal even by way of rehearing: see, for example s 75A(8) of the Supreme Court Act 1970 (NSW).
Interlocutory orders, of their very nature, create no res judicata or estoppel, and the court retains jurisdiction to set aside, vary or discharge an interlocutory order up to the time of the final disposition of the proceedings. However the general rationale of the principles last referred to applies even in the case of interlocutory orders. It would be conducive to great injustice and enormous waste of judicial time and resources if there were no limit on the power of a party to have any interlocutory application or order relitigated at will.
The overriding principle governing the approach of the court to interlocutory applications is that the court should do whatever the interests of justice require in the particular circumstances of the case. In giving effect to that general principle, and in recognition of the public and private interests earlier referred to, rules of practice have been developed in accordance with which the discretionary power of the court to set aside, vary or discharge interlocutory orders will ordinarily be exercised. Not all kinds of interlocutory orders attract the same considerations. For present purposes one may put to one side orders of a merely procedural nature (as to which see for example Wilkshire & Coffey v Commonwealth (1976) 9 ALR 325) and injunctions (or undertakings) made or given by agreement and without contest "until further order" (as to which see for example Warringah Shire Council v Industrial Acceptance Corp (unreported, SC(NSW), McLelland J, 22 November 1979).
In the present case I am dealing with an interlocutory order of a substantive nature made after a contested hearing in contemplation that it would operate until the final disposition of the proceedings. In such a case the ordinary rule of practice is that an application to set aside, vary or discharge the order must be founded on a material change of circumstances since the original application was heard, or the discovery of new material which could not reasonably have been put before the court on the hearing of the original application: see Woods v Sheriff of Queensland (1895) 6 QLJ 163 at 164-5; Hutchinson v Nominal Defendant [1972] 1 NSWLR 443 at 447-8; Chanel Ltd v F W Woolworth & Co [1981] 1 All ER 745; [1981] 1 WLR 485; Adam P Brown Male Fashions v Philip Morris (1981) 148 CLR 170 at 177-8; 35 ALR 625 at 629-30; Butt v Butt [1987] 1 WLR 1351 at 1353; Gordano Building Contractors Ltd v Burgess [1988] 1 WLR 890 at 894.
The following passages illustrate the point:
The defendants are seeking a rehearing on evidence which, or much of which, so far as one can tell, they could have adduced on the earlier occasion if they had sought an adequate adjournment, which they would probably have obtained. Even in interlocutory matters a party cannot fight over again a battle which has already been fought unless there has been some significant change of circumstances, or the party has become aware of facts which he could not reasonably have known, or found out, in time for the first encounter. The fact that he capitulated at the first encounter cannot improve a party's position.
(Chanel v Woolworth & Co at All ER 751-2; WLR 492-3 per Buckley LJ.)
A court must remain in control of its interlocutory orders. A further order will be appropriate whenever, inter alia, new facts come into existence or are discovered which render its enforcement unjust … Of course the changed circumstances must be established by evidence
(Adam P Brown Male Fashions at CLR 178; ALR 630 per Gibbs CJ and Aickin, Wilson and Brennan JJ.)
48 In the present case, MCI not only has to persuade the Court to reopen the permanent stay order but requires leave to reopen the case which it put when resisting TWE's application for such an order by tendering further evidence and making further submissions. This is not a case where a party seeks to reopen the judgment by putting additional submissions based upon the evidence already before the Court. Although the permanent stay order is interlocutory, it has the practical effect of finally bringing the present proceeding to an end. The abuse of process application was fully argued and detailed reasons were given by the Court for making the permanent stay order.
49 MCI cited the judgment of Hargrave J in Tenth Vandy Pty Ltd v Natwest Markets Australia Pty Ltd [2006] VSC 170. That was a case where the plaintiff made multiple applications to reinstate the proceedings after they were struck out by reason of some procedural default. The issue in that case was whether the Court had power to entertain successive interlocutory applications. I do not consider this case to be of any present relevance.