Plaintiff v Defendant

An action may be brought on a previously settled cause of action.

1. Accordingly, the plaintiff brings this action as of right, not as a matter preliminary to the relevant cause of action. However, the settlement deed signed by him is a defence to the claim unless set aside under s 27QE. In claims under s 27QA, the setting aside of a prior deed is in my view clearly interlocutory as it does not determine the rights of the parties in the principal cause between them. This is because, perhaps in distinction to many other applications to set aside agreements, any order under s 27QE is made in an action permitted by statute notwithstanding the prior settlement. The principal cause is one that contemplates re-opening the respective rights and obligations for further determination.
2. An order made by the Court under s 27QE of the Act is not quite analogous to the general power that a Court has to set aside an agreement or order obtained by fraud or by unconscionable conduct. In such cases often the conduct of the parties in entering the agreement forms part of the cause of action in the proceeding which must be established at trial. Here while the circumstances in which the deed is entered into are relevant to the application to set aside, they are not matters integral to the cause of action brought under s 27QA. In other circumstances an agreement might be set aside as a prelude to equitable relief or other relief.
3. The effect of an order under s 27QE revives a previous cause of action to facilitate a further determination of that cause of action where it is just and reasonable to do so. The determination permitted by s 27QA is the further determination of the rights of the parties in the principal cause.
4. The remaining provision of s 27QE setting out the powers of the Court reinforce my view that any order setting aside a prior settlement, whether in whole or in part, is interlocutory. Sub-section (1) deals with the power to order that a settlement agreement be set aside. That power is exercisable on an application under s 27QD or otherwise in a proceeding. By contrast sub-s (2), set out above at paragraph [7], provides powers exercisable at the hearing and determination of the action. As such, they could not, without a referral order or operation of r 77.02(2), be heard by an Associate Judge.
5. While it is true that the settlement deed pleaded in the defence, could be an issue determined at trial, s 27QD makes specific provision for such an application to be made prior to trial. The alternative use of r 47.04 for the determination of a preliminary question may also be utilised, as it was in WCB.
6. Order 47 of the Rules deals with the place and mode of trial. Rule 47.04 provides:

Separate trial of question

The Court may order that -

(a) any question in a proceeding be tried before, at or after the trial of the proceeding, and may state the question or give directions as to the manner in which it shall be stated;

(b) different questions be tried at different times or places or by different modes of trial.

1. Rule 47.04, although describing a trial of a separate question, provides a flexible rule for dealing with discrete legal or factual disputes either before, at or after trial.[18] A trial is generally a reference to the hearing of the claim for final relief or remedy before a Judge or Judge and jury.
2. Rule 47.04 permits the identification of specific questions of law, mixed fact and law, or fact. One use of r 47.04 is to provide for a preliminary question before trial.[19] Other uses have included a change in mode of trial from a cause for determining liability and causation to a jury for determining damages.[20] The caution to be applied in ordering a separate trial of a question or issue in a proceeding by r 47.04 has often been repeated.[21]
3. Despite the caution, the procedure is capable of being used with great advantage where the issue, and the basis upon which it falls to be decided, can be stated with specific particularity. A hearing on a single issue should only occur where the subject matter is capable of isolation and clear demarcation and where utility, economy and fairness to the parties are beyond question.[22]
4. Where r 47.04 is used to identify preliminary questions, it follows that the determination of those questions are made in advance of an anticipated trial. It is a critical part of the decision to order a hearing of an issue prior to trial that the outcome will be 'likely to end the litigation or substantially narrow the issues in dispute, or where there is a clear demarcation between that issues and the other issues in the case'.[23] When recently summarising the principles to apply in ordering a separate question prior to trial Derham AsJ said in Walters v Perton (No 3):[24]

As a general rule, it is inappropriate to order that a preliminary issue be isolated for determination unless the determination of the issue in favour of the plaintiff or the defendant will put an end to the action, or where there is a clear line of demarcation between issues and the determination of one issue in isolation from the other issues in the case is likely to save inconvenience and expense.[25]

1. Despite the need for finality in respect of the particular question, a preliminary question under r 47.04 has been determined to be interlocutory in nature.[26] In Dunstan v Simmie & Co Pty Ltd, referred to by counsel for the plaintiff, the majority held that leave to appeal was required because:

An order made upon the determination of a question or issue ordered to be determined as a preliminary matter prior to trial is an interlocutory and not a final order.[27]

Their Honours did so, not because the practical effect of the order might be to put an end to the proceeding, but because:

The determination of such preliminary issues will not result in judgment in the strict sense, it will result in an order upon which, if the determination puts an end to the action, a party may move for judgment...A judgement, strictly speaking, is a decision obtained in an action. [28]

1. Even if the answer to the preliminary question under r 47.07 substantially disposes of the proceeding or renders a trial unnecessary, it is still necessary to grant or refuse final relief in the proceeding, and r 47.05 provides for judgments after determination of preliminary questions. Returning to the observation in Hall, the consequences are those of the 'final determination of that action' or 'whether it puts to an end an existing dispute or action', bearing in mind the character of the proceeding. Rule 47.05 supports the view that determination of a preliminary question may not itself bring about judgment on the proceeding, even if it has the practical effect of substantially disposing of the dispute.
2. There may be circumstances where a preliminary question, whatever the answer, finally determines the principal cause between the parties, both in practical effect and in law. In this case, both parties accepted that an order refusing to set aside the settlement deed would be interlocutory as, in practice, a plaintiff would not necessarily be barred from making a further application. The alternative outcome setting aside the deed would also not finally determine any liability to the plaintiff for damages or their quantum, it would only remove a defence raised in opposition to a cause of action on a previously settled claim.
3. Therefore, in my view, the proceeding listed before Ierodiaconou AsJ on 23 October 2024 was within power and did not require a referral order under r 77.05 of the Rules.

[1] Plaintiff, 'Amended Statement of Claim', 30 January 2024.

[2] Defendant, 'Amended Defence to the Amended Statement of Claim', 2 September 2024, 9-10 [19]-[29].

[3] [2016] VSC 733.

[6] [2004] VSCA 217; (2004) 10 VR 277 ('Dodoro').

[7] Pearce v Corporation of the Society of the Missionaries of the Sacred Heart [2022] VSC 697, 19 [79]-[80] citing Roman Catholic Trusts Corporation for the Diocese of Sale v WCB [2020] VSCA 328 at 32 [97].

[8] [2020] VSC 639.

[9] [2023] VSC 124.

[10] Trustees of the Christian Brothers v DZY [2024] VSCA 73, 1 [5].

[11] Dodoro (n 6) 281 [17] citing Hall v Nominal Defendant [1966] HCA 36; (1966) 117 CLR 423 at 443 (Windeyer J) ('Hall').

[12] Hall (n 11) 443 (Windeyer J) with Taylor J agreeing at 439-40, Owen J agreeing at 447 and Barwick CJ dissenting at 430.

[13] Ibid 443 (Windeyer J); a view also expressed by Brett LJ in Standard Discount Co v La Grange [1877] UKLawRpCP 58; (1877) 3 CPD 67 at 72.

[16] Swannell v Farmer [1998] VSCA 104; [1999] 1 VR 299.

[17] Dodoro (n 6) 284 [24] (Callaway JA) with Winneke P, Charles and Buchanan JJA agreeing and Eames JA dissenting on the question of leave but agreeing on the nature of the order refusing leave.

[18] Jacobson v Ross [1995] VicRp 24; [1995] 1 VR 337.

[19] Wadley v Ron Finemore Bulk Haulage Pty Ltd [2013] VSC 5.

[20] Birti & Anor v SPI Electricity & Anor [2011] VSC 566, 8 [26].

[21] Murphy v Victoria [2014] VSCA 238; (2014) 45 VR 119.

[22] Tepko Pty Limited & Ors v Water Board [2001] HCA 19; (2001) 206 CLR 1 at [168]-[170] (Kirby and Callinan JJ); see also Dunstan v Simmie & Co Pty Ltd [1978] VicRp 62; [1978] VR 669 ('Dunstan').

[23] Vale v Daumeke [2015] VSC 342, 18 [31(b)] (Derham AsJ).

[24] [2019] VSC 733.

[28] Ibid 670 (Young CJ and Jenkinson J); note McInerney J concurred on this issue but dissented as to the answers to the preliminary questions.