PFJV Pty Limited v Bartter Enterprises Pty Limited [2022] QSC 110

• [1] The defendant (Bartter) seeks an order striking out the plaintiff's (PFJV) Fifth Amended Statement of Claim (5ASOC). PFVJ seeks orders that Bartter make further disclosure.

• [2] In its written submission, Bartter sets out a series of facts which encompass the matters said to have led to the proceedings in this case. They were uncontroversial:

(a) Bartter is a part of the Baiada Group, which is one of the largest processors of broiler chickens in Australia. It had a processing plant at Wulkuraka outside Ipswich which was supplied by numerous broiler chicken farms. One of those farms was the Donnybrook farm operated by Repstar Pty Ltd.

(b) PFJV sought to acquire Repstar's business, which included a contract to supply broiler chickens to Bartter for processing. Repstar was one of many which supplied the Wulkuraka plant.

(c) Notwithstanding that it had an initial five-year term, the broiler chicken contract was unilaterally terminable by the defendant on three months' notice if the defendant closed its nearest processing plant, which in this case is the Wulkuraka plant.

(d) Repstar was required to obtain Bartter's consent to assign the broiler chicken contract to PFJV.

(e) Bartter consented to the assignment of the broiler chicken contract to PFJV on 11 October 2016. PFJV acquired Repstar's business, including the contract, in mid-November 2016.

(f) On 28 August 2017, Bartter gave about six months' notice of its intention to close the Wulkuraka plant. The plant closed in early 2018.

• [3] So far as is relevant, the case for PFJV appears to be that, during negotiations concerning the assignment of the broiler chicken contract, the Bartter representatives did not disclose:

(a) that the Baiada Group had engaged in a process of both expansion and consolidation of facilities; and

(b) that the process involved closing facilities which did not perform adequately.

• [4] The causes of action advanced by PFJV are that Bartter:

(a) engaged in misleading and deceptive conduct which contravened s 18 of the Australian Consumer Law (in Schedule 2 of the Competition and Consumer Act 2010 (Cth)); and

(b) engaged in unconscionable conduct which contravened s 21(1) of the Australian Consumer Law.

• [5] A part or all of a pleading may be struck out under r 171:

"(1) This rule applies if a pleading or part of a pleading -

(a) discloses no reasonable cause of action or defence; or

(b) has a tendency to prejudice or delay the fair trial of the proceeding; or

(e) is otherwise an abuse of the process of the court.

(2) The court, at any stage of the proceeding, may strike out all or part of the pleading and order the costs of the application to be paid by a party calculated on the indemnity basis. ..."

• [6] The relevant principles which aid in determining whether a pleading is adequate were summarised in Barr Rock Pty Ltd v Blast Ice Creams Pty Ltd & Ors:[1]

"[27] ... Considerations relevant in deciding if a pleading is deficient include whether it fails to fulfil the function of pleadings, which are 'to state with sufficient clarity the case that must be met' and thus define the issues for decision thereby ensuring procedural fairness (Banque Commerciale SA (In liq) v Akhil Holdings Ltd (1990) 92 ALR 53 at 58-59). A pleading will lack sufficient clarity if it is 'ambiguous, vague or too general, so as to embarrass the opposite party who does not know what is alleged against him' (Thiess Pty Ltd v FFE Minerals Australia Pty Ltd [2007] QSC 209 at [37], applying Meckiff v Simpson [1968] VicRp 7; [1968] VR 62 at 70). Likewise, a pleading will be deficient if the pleader's case is not 'advanced in a comprehensible, concise form appropriate for consideration both by the court, and for the purpose of the preparation of a response' (QIC Logan Hyperdome Pty Ltd & Anor v Briridge Pty Ltd & Anor [2011] QSC 43 at [10], see r 149 UCPR).

[28] A pleading must contain all the material facts relied upon (r 149(b) UCPR) and a deficiency in pleading material facts needed to establish a cause of action may not be remedied through the use of particulars, which are intended to meet a further and quite separate requirement (r 157 UCPR, Bruce v Odhams Press Ltd [1936] 1 KB 697 at 712; Dawnlite Pty Ltd v Riverwalk Realty Pty Ltd [2010] QSC 249 at [44]). On the other hand, a pleading may be liable to be struck out where it includes irrelevant allegations which, by their nature, will affect the expeditious determination of the proceeding (Colston v McMullen [2011] QSC 60)."

• [7] Further, any pleading which is difficult to follow or objectively ambiguous, or which creates difficulty for the opposite party insofar as the pleading contains inconsistencies, is liable to be struck out because it can be said to tend to prejudice or delay the fair trial of the proceeding.[2]
• [8] Of particular relevance where a claim of misleading conduct is alleged are the principles identified by Perry J in Australian Parking and Revenue Control Pty Ltd v Reino International Pty Ltd:[3]

"(5) A party who pleads a condition of mind, including knowledge, must state in the pleading particulars of the facts on which the party relies: FCR r 16.43(1) and (3). Equally, if a party pleads that another party ought to have known something, particulars of the facts and circumstances on the basis of which it is said that that other party ought to have acquired the knowledge must be pleaded: FCR r 16.43(2). For example, it might be pleaded that a party knew or ought to have known a given fact because it received a particular communication: Young Investment Group at 540 [10].

(6) Furthermore, in line with the seriousness of such an allegation, a party who pleads (relevantly) misrepresentation must state in the pleading particulars of the facts on which the party relies: FCR r 16.42. As Foster J held in Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd [1998] FCA 525; (1998) 42 IPR 1 at 3 with respect to a statement of claim alleging misleading and deceptive conduct in breach of s 52 of the Trade Practices Act 1974 (Cth) (Trade Practices Act) (the predecessor provision to s 18 of the ACL):

In this connection it is important to remember that, as Fox J said in Brown v Jam Factory Pty Ltd (1981) 53 FLR 340 at 348 ; 35 ALR 79 at 86:

Section 52(1) is a comprehensive provision of wide impact, which does not adopt the language of any common law cause of action. It does not purport to create liability at all; rather does it establish a norm of conduct, failure to observe which has consequences provided for elsewhere in the same statute, or under the general law.

It necessarily follows that when the section is sought to be used in litigation as the foundation of a cause of action or claim for some specific form of relief, it is imperative that the factual basis upon which the section is alleged to be brought into play must be stated with appropriate clarity in a statement of claim. This is, of course, a fundamental principle of pleading.

In this regard, Foster J laid particular emphasis upon the need for the questions for decision to be defined from an early stage in order to avoid misdirected, wasteful and unproductive interlocutory procedures such as discovery, observing that '[e]xperience is showing that the court must be astute in the prevention of this type of situation by requiring, in the early stages of litigation, that claims based on s 52 be pleaded with appropriate precision and in a manner that enables the factual issues for trial to emerge with clarity': see also e.g. McKellar at 419 [25]-[28] (Weinberg J).

• [9] Bartter's argument concentrates on the part of the pleading in 5ASOC which bears the sub-heading: "Probability of Closure of Wulkuraka Plant".
• [10] The relevant parts of that section of the pleading may be summarised in this way:

(a) Paragraph 10B - Before 20 August 2016, the Baiada Group and Bartter were pursuing a strategy of having fewer real property sites;

(b) Paragraph 10BA - Before 20 August 2016, the Baiada Group and Bartter were concerned about the costs of the Wulkuraka plant being too high;

(c) Paragraph 10BB - Before and on 20 August 2016, the Wulkuraka plant was not one of the sites which the Baiada Group and Bartter intended to retain or alternatively they were actively considering ceasing live chicken processing at the Wulkuraka plant.

• [11] Paragraph 10BC is at the centre of the application to strike out. It reads, in its amended form:

"10BC In the premises pleaded at 10B to 10BB above, as at 1 August 2016:

(a) it was probable that the Wulkuraka Facility would cease live processing or processing broiler chickens grown at the Donnybrook farm within the near future; and

(b) it was very likely that the Wulkuraka Facility would cease live processing or processing broiler chickens grown at the Donnybrook Farm prior to 30 June 2020; and alternatively

(c) the probability and/or possibility that the Wulkuraka Facility would cease live processing or processing broiler chickens grown at the Donnybrook Farm were, or was, under active consideration."

• [12] The first claim by PFJV of nondisclosure appears in paragraph 23 of 5ASOC:

"23. The Defendant did not, during or about the time of the August 2016 Discussion, disclose the matters referred to at paragraphs 10B to 10BC above and the Expansion and Consolidation Process to Mr Vorster or Mr Feitelson or the Plaintiff (Initial Non-Disclosure).

The Defendant did not disclose the intended closure of the Wulkuraka Plant to live processing to Mr Vorster or Mr Feitelson or the Plaintiff until about 28 August 2017 and, further, the Defendant did not disclose prior to 20 August 2016 that the closure of the Wulkuraka Plant to live processing was under active consideration."

• [13] Bartter's complaint is in two parts. First, it refers to various iterations of the statement of claim in which there have been a number of different allegations as to what it is that Bartter is supposed to have known and which ought to have been communicated to PFJV. In its written submission, after referring to the changes made in the various versions of the statement of claim, Bartter says that "there is no obvious real difference between the various forms of words used in the different amendments". The concern expressed is that, as the changes have been made, it suggests that there must be some difference between the various words used. That may well be so. But that does not mean, by itself, that the latest version is somehow objectionable.
• [14] The second complaint is one of greater substance. The new alternative allegation added to paragraph 10BC is objectionable and should be struck out.
• [15] The amendment encompasses a large number of different permutations which exposes Bartter to a wide and indistinct set of possible allegations.
• [16] That vagueness commences with the use of the term "probability and/or possibility". I expressed my disdain for the "and/or" conjunction in St Clair v Timtalla Pty Ltd (No 2):[4]

[11] The pleading is replete with the device "and/or" which was accurately described by Viscount Simon LC in Bonitto v Fuerst Bros & Co Ltd [1944] AC 75 at 82 as the "Bastard conjunction" which was the "commercial courts contribution to basic English". The term has generally been regarded as unacceptable in commercial documents and more so in pleadings. In Re Moage Ltd [1998] FCA 296; (1998) 153 ALR 711, Burchett J said (at 716-717):

"Although Lord Reid declared in John G. Stein & Co Ltd v O'Hanlon [1965] AC 890 at 904 that '[t]he symbol "and/or" is not yet part of the English language', it has long been recognized as a loose expression conveying a vague meaning. An early version of it is to be found in Cuthbert v Cumming (1855) 24 LJ Ex 198, where Alderson B said (at 199) 'the contract on the face of the charter-party was, that the parties were to "load a full and complete cargo of sugar, molasses, and/or other lawful produce," so that, according to the contract, the parties were either to load a full and complete cargo of sugar and molasses, and other lawful produce, or a full cargo of sugar and molasses, or a full cargo of other lawful produce, leaving it open in every way by reason of the words "and" and "or" being introduced into the charter-party'. Similarly, in Furness v Charles Tennant, Sons, & Co (1892) 8 TLR 336, Lord Herschell construed a charter-party requiring the loading of 'a full and complete cargo of sugar in hogsheads and (or) bags, or other lawful merchandise' as entitling the charterers 'to discharge their obligation by loading a cargo of sugar either in hogsheads or in bags, or partly in hogsheads and partly in bags.' But the expression, or symbol, as Lord Reid preferred to call it, has been found to create difficulties. In Millen v Grove [1945] VicLawRp 26; [1945] VLR 259 at 260 Gavan Duffy J referred to a notice to quit as having 'invited trouble by the common and deplorable affection for the form "and/or"'. In ; at 98 Barry J said:

'I agree that the expression "and/or" is commonly an indication that the draftsman is not clear in his own mind about the matters with which he has to deal (cf Piesse, Elements of Drafting, pp. 52-57).'

In Neame v Neame's Trs. [1956] SLT 57, the majority of the court read 'and/or', in a deed, as meaning nothing more than 'and'. The Lord President, Lord Clyde, said (at 62):

'But it would be most unfortunate if a confusing expression such as "and/or" were to become a common feature in Scottish marriage contracts or testamentary settlements.'

Lord Carmont, who differed from the majority, went further, and said (at 64) that in his opinion 'the obscurity is radical'. Lord Russell concluded his judgment with the comment (at 64):

'I would venture to add that in my judgment the phrase "and/or" is at best a loose and ambiguous term which would be better not to be used in formal legal writs affecting patrimonial interests.'

Lord Sorn joined the chorus of disapproval when he said (also at 64):

'The expression "and/or" is not a happy one and, if occurring in a simple gift, might give rise to a serious problem of construction.'

In my opinion, the expression is particularly unhappy when it is used in a statement of claim, which should express precisely the foundation of the proceeding. In the present case, as has been explained, an almost endless series of additional and alternative allegations would be conveyed by an analysis of the claim made in this way." (emphasis added)

[12] In Employers Mutual Liability Insurance Co of Wisconsin v Tollefsen 263 NW 376 Fowler J said, at 377:

"It is manifest that we are confronted with the task of first construing 'and/or,' that befuddling, nameless thing, that Janus-faced verbal monstrosity, neither word nor phrase, the child of a brain of someone too lazy or too dull to express his precise meaning, or too dull to know what he did mean, now commonly used by lawyers in drafting legal documents, through carelessness or ignorance or as a cunning device to conceal rather than express meaning with view to furthering the interest of their clients. We have even observed the 'thing' in statutes, in the opinions of courts, and in statements in briefs of counsel, some learned and some not."

[13] His Honour's choleric exegesis might not call for agreement in all its elements but it is difficult not to register general agreement with his underlying protest."

• [17] A less irascible statement of disapproval was made by McPherson J in Re FFE Group (Qld) Pty Ltd:[5]

"The use of "and/or" has often been judicially deprecated and the expression has been described as one that endangers accuracy for the sake of brevity: Fadden v Deputy Federal Commissioner of Taxation [1943] HCA 20; (1943) 68 CLR 76. 82, per Williams J. In most contexts the use of it produces three different meanings ..."

• [18] The advice given by Bryan Garner in Garner's Modern English Usage[6] in his treatment of the term should be followed by all pleaders:

"A legal and business expression dating from the mid-19th century, and/or has been vilified for most of its life - and rightly so. To avoid ambiguity, don't use it." (emphasis added)

• [19] Paragraph 10BC(c) does not allege that closure of the Wulkuraka plant was either probable or possible. It does not allege that the closure of the plant was under active consideration. It is an allegation that the probability or possibility of closure was under active consideration. But that is not what is pursued in paragraph 23. In that paragraph it is alleged that Bartter did not disclose the "intended closure" of the plant. That is not pleaded in either paragraph 10B or paragraph 10BC. Thus, it is not possible to rely on another part of the 5ASOC to determine the meaning of paragraph 10BC.
• [20] Another problem arises from the use of the term "active consideration". That is a term which needs to be defined. Its use is the subject of derision in many quarters. In Weasel Words: The Dictionary of American Doublespeak[7] the authors define the term as meaning your "application, manuscript or request has been stuffed in a file drawer, along with hundreds of others". It is, as I noted during the hearing, redolent of the language of Yes Minister[8] - and should not find its way into a pleading.
• [21] The paragraphs in the 5ASOC to which I have referred are difficult to follow and are ambiguous. They do not allow the reader to understand precisely what is being alleged.
• [22] Although PFJV has made a number of attempts at pleading a final version of its statement of claim, I'm not satisfied that it has yet reached the stage where the entire pleading should be struck out. The complaint made by Bartter was reasonable so far as it concerned the paragraphs referred to above. They need to be attended to. I order that paragraphs 10B - 10BC and paragraph 23 be struck out. I give leave to PFJV to replead.

• [23] By its amended application, PFJV seeks an order requiring that Bartter (and other entities) disclose documents which fall into four broad categories. The first is sufficient to give a flavour of all the categories:

(a) documents which record or relate to any plan, proposal or intention of the defendant and/or Baiada and/or the Baiada Group to develop, increase or enhance chicken growing and/or processing operations in New South Wales in the period from July 2009 to 2 August 2017, including, but not limited to the possible, probable, planned or actual:

(i) increase of the feed supply for broiler chickens grown in New South Wales;

(ii) increase of its hatchery capacity or access in New South Wales;

(iii) increase of its broiler chicken supply in New South Wales;

(iv) expansion of its processing capability in New South Wales; and

(v) upgrade of the Wulkaraka processing plant in Queensland to enable it to become a secondary processing plant and distribution hub for the Baiada Group's South East Queensland customers.

• [24] The other three categories also refer to:

(a) the time period from July 2009 to August 2017;

(b) documents which "record or relate" to any consideration or any plan, proposal, or intention; and

(c) documents which record or relate to any consideration given by the defendant and others to the probability and/or possibility that the plant would cease live bird processing in that period.

• [25] In its submissions, PFJV identifies paragraphs 10B, 10BB, and 10BC and others as making the documents sought directly relevant. As PFJV will be re-pleading those paragraphs, it would not be appropriate to make an order with respect to a pleading which is not yet complete. This application should be pursued, if PFJV is still minded to do so, after the new amended Statement of Claim is finished.
• [26] It is, though, worth making some observations about the nature of the present application:

(a) the time period of just over eight years cannot be justified - it imposes too great a burden on Bartter and the relevance of such documents before, say, the three-year period leading up to August 2017 was not established;

(b) the use of the words "record or relate to any plan, proposal or intention" extends the scope for disclosure beyond that which is directly relevant to a matter in issue;

(c) the use of the word "relate" is inappropriate as it would capture documents which concerned matters such as plans which were dismissed;

(d) the use of the words "any consideration" is too broad as it would cover the most fleeting of consideration of plans which were later abandoned; and

(e) the use of the words "probability and/or possibility" injects a substantial element of uncertainty beyond that which is appropriate in the description of disclosable documents.

• [27] There are other objectionable elements of the amended application which were canvassed in argument. They should be taken into account in any further amended application.

• [28] Paragraphs 10B - 10BC and paragraph 23 of the 5ASOC are struck out. I give leave to PFJV to replead.
• [29] PFJV's application for further disclosure is adjourned to a date to be fixed.

[1] [2011] QCA 252.

[2] Robert Bax & Associates v Cavenham Pty Ltd [2011] QCA 53.

[3] [2016] FCA 744 at [19].

[4] [2010] QSC 480.

[5] [1984] 1 Qd R 267 at 270.

[8] Yes Minister, Series 1 Episode 2 - "Jim Hacker: What's the difference? Bernard: Well, "under consideration" means "we've lost the file"; "under active consideration" means "we're trying to find it".