Plaintiff v First Defendant

Supreme Court of Victoria|2009-02-27|Before: KAYE J

DEFAMATION - Practice - Consolidation - Two proceedings by same plaintiff against defendants - Common issues of fact and law - Potential prejudice - Whether effect of s 35 of Defamation Act 2005 (Vic) relevant - Order for consolidation made.

1 The defendants, by summons, made an application for an order that the present proceeding be stayed, on the ground that it was commenced, by the plaintiff, without having first obtained leave to do so, pursuant to of the . That part of the defendants' application was based on the proposition that the plaintiff has issued, and has on foot, previous proceedings between the plaintiff and the defendants ("the previous proceeding") in relation to the publication by the defendants of "like matter" for the purpose of of the . On 14 November 2008, I delivered a ruling, dismissing the defendants' application for a stay. In the alternative, the defendants, in the same summons, also applied for an order that the present proceeding be consolidated with the previous proceeding. At the request of counsel for the plaintiff, I did not rule on that part of the defendants' application, but adjourned the matter, in order that the parties might file and make further submissions concerning the relevance of of the , to the defendants' application for consolidation. The parties have now filed further submissions, and I have heard oral argument in relation to them.

2 The background to the defendants' application is set out in my previous ruling of 14 November 2008, and also in a ruling which I gave in the previous proceeding on 5 November 2008 on a number of interlocutory disputes arising in that proceeding.[2] It is not necessary for me to repeat the relevant background in this ruling.

3 The application by the defendants that the two proceedings be consolidated is made pursuant to r 9.12(1) of the Rules of the Supreme Court which provide:

(1) Where two or more proceedings are pending in the Court, and -

(a) where some common question of fact or law arises in both or all of them;

(b) the rights to relief claimed therein are in respect of or arise out of the same transaction or series of transactions; or

(c) for any other reason it is desirable to make an order under this Rule, the Court may order the proceedings to be consolidated, or to be tried at the same time or one immediately after the other, or may order any of them to be stayed until after the determination of any other of them.

4 It is axiomatic, from the criteria specified in Rule 9.12, that a court will not make an order consolidating two proceedings, if the cause of action alleged in the second proceeding could not have been properly joined in the first proceeding.[3] Otherwise, subject to the criteria specified in r 9.12, the decision whether to consolidate two proceedings is a matter for the discretion of the Court. In Cameron v McBain[4] Herring CJ stated:

The cases, however, lay down no principle upon which discretion of the Court in the matter is to be exercised. And so each case must be decided upon its own special circumstances. The question would seem to be whether in all the circumstances it is convenient that the actions be consolidated, and in deciding whether it is convenient, regard may be had to such matters as the desirability of avoiding multiplicity of actions, and the saving of time and expense. At the same time the interests of the parties should not be prejudiced by the making of an order.[5]

5 As pointed out by Herring CJ, the discretion is to be exercised bearing in mind the principle that it is desirable to avoid a multiplicity of actions. That principle finds express statement both in s 29(1) of the Supreme Court Act 1986 and also in r 1.14 of the Rules of the Supreme Court. It is an important principle, directed to saving the parties the expense and inconvenience of unnecessary litigation. It is also a principle which serves the public interest in ensuring the most efficient use of the resources of the Court.

6 On the other hand, an order for consolidation will not be made, where such an order might result in unfair prejudice to one or either of the parties in the litigation. One example of such a consideration was Cameron v McBain, to which I have just referred. In that case one plaintiff, Cameron, brought two proceedings against Sloan, arising out of a motor vehicle accident. One of the proceedings was brought for injury sustained by Mrs Cameron, and the other was brought by her as executrix of the will of her deceased husband, who was killed in the accident. Another plaintiff, Buttfield, also brought a separate proceeding against the same defendant for damages in which she also sustained injuries arising out of the same accident. Although all three proceedings concerned the same accident, and, on the question of liability, the same issues, Herring CJ rejected an application by the defendant for consolidation of the three proceedings. His Honour declined to consolidate the proceedings because of a reasonable apprehension that the trial of the three actions before the same jury might have a depressing effect on the amount of damages each party might be awarded.[6]

7 Essentially, the Court adopts a pragmatic approach in determining the question whether the two proceedings should be consolidated. As Austin J observed in A. Goninan and Co v Atlas Steels,[7] the "overriding purpose of the rules ... is to facilitate the just, quick and cheap resolution of the real issues in the proceedings." Thus, where the two proceedings have common issues, an order for consolidation may be made, unless unfair prejudice is thereby occasioned to one or other of the parties.[8]

8 Ms G. Schoff, who appeared on behalf of the defendants, submitted that, on the face of the pleadings, the previous proceeding and the present proceedings have a number of common issues of fact and law. She submitted that, while each application for consolidation should be decided by reference to the particular circumstances of the case, s 29(2) of the Supreme Court Act 1986 and r 1.14 of the Rules of the Supreme Court, place emphasis on the need to avoid a multiplicity of proceedings between parties. Ms Schoff further submitted that this is the type of case in which, historically, courts have readily made consolidation orders. She referred me to a number of decisions, including Cameron v McBain,[9] Horwood v Statesman Publishing Co,[10] and Todd v Jones.[11] Ms Schoff submitted that consolidation of the two proceedings would avoid duplication, and thus save costs on the interlocutory issue steps which are still outstanding, particularly in the present proceeding. In addition, consolidation of the two proceedings would render unnecessary a number of orders and other procedures which would otherwise be needed to ensure that the two proceedings were heard together.

9 Ms Schoff further submitted that the only basis upon which the plaintiff resisted the application for consolidation was because of the potential effect of s 35 of the Defamation Act on the amount of damages which might otherwise be recoverable by the plaintiff, should he succeed in each action. Ms Schoff submitted that the potential effect of s 35 of the Defamation Act is irrelevant to my consideration of the application for consolidation. For, if s 35 does apply so as to impose a pecuniary cap of damages in respect of each proceeding (and not in respect of each cause of action), the defendants would suffer unfair prejudice if the proceedings were not consolidated, in circumstances where, otherwise, an order for such consolidation would be made. In other words, as Ms Schoff succinctly put it, the issue of prejudice "cuts both ways".

10 In response, Mr Clarke commenced by referring to statements by the Full Court of this Court in Bolwell Fibre Glass Pty Ltd v Foley[12] which, he submitted, had specified that an order for consolidation should be rarely made. He submitted that it was not necessary, nor appropriate, that the two proceedings be consolidated. Rather, it is appropriate that, in due course, an order be made that the two proceedings be tried together. Mr Clarke submitted that the defendant had not demonstrated that there would be any added complexity, or expense, in having the two proceedings heard together, rather than consolidated. The interlocutory steps in the first proceeding are well advanced, whereas pleadings have not closed in the present proceeding. Accordingly, at this stage it would be otiose to make an order for consolidation for the purpose of avoiding duplication of interlocutory steps.

11 Mr Clarke further submitted that the plaintiff was fully entitled to issue the present proceeding, rather than seeking to amend the previous proceeding, in order to add to it the cause of action pleaded in the present proceeding. In this regard, he referred to and relied on the ruling which I have made in respect to the application by the defendants for a stay of the proceeding pursuant to s 23 of the Defamation Act. He submitted that the defendants are only seeking to have the two proceedings consolidated because of the potential effect of s 35 of the Defamation Act. In those circumstances, he submitted that the plaintiff would suffer prejudice should the two proceedings be consolidated, because, at the least, he would be thereby exposed to an argument that s 35(1) of the Act imposes a maximum ceiling to damages which might be awarded in a particular proceeding, regardless of the number of separate causes of action pleaded in that proceeding.

12 Mr Clarke did not gainsay, but indeed accepted, that there are common issues of fact and law between the two proceedings. In the present proceeding, the plaintiff has pleaded a number of innuendos, which are identical to those pleaded by him in the previous proceeding. Although the defendants have not, as yet, delivered a defence in the second proceeding, it is safe to expect that that defence will plead similar defences to those pleaded in the first proceeding, in respect to the innuendos which are common to the two proceedings.

13 Accordingly, if the plaintiff had been minded to do so, rather than issuing the second proceeding, the plaintiff might, alternatively, have amended his statement of claim in the previous proceeding, in order to add to it the cause of action pleaded in the second proceeding. Indeed, it is clear that the only reason why the plaintiff did not follow that course is because of the potential effect of s 35 of the Defamation Act on the maximum amount of damages which might be awarded to him, should he add the cause of action, pleaded in the present proceeding, to the statement of claim in the previous proceeding.

14 So far, discovery has been completed in the previous proceeding. The plaintiff has made an application for inspection of documents, discovered by the defendants in that proceeding. I am delivering another ruling on that application today. While, as I have already held in my previous ruling, the focus of the article, which is the basis for the claim in the present proceeding, is different to the focus of the articles pleaded in the previous proceeding, nevertheless the article, which is the subject of the present proceeding, did refer to, and repeat, a number of allegations contained in articles which are the subject of the previous proceeding. It is for that reason that there is some commonality in the innuendos pleaded in the two sets of proceedings. As a result, most, if not all, of the documents which have been discovered by the defendants in the first proceeding would, probably, be discoverable in the present proceeding. If the proceedings were consolidated, the additional discovery occasioned by the second proceeding would be catered for by the parties swearing supplementary affidavits of documents. If the two proceedings are not consolidated, then it will be necessary for there to be some duplication of the discovery in the two sets of proceedings.

15 Similarly, if the two proceedings are not consolidated, a number of the issues, which will be the subject of interrogatories in each proceeding, will be the same. Furthermore, consolidation of the two proceedings would avoid some duplication of orders, and other procedures, at the stage at which the proceeding is set down for trial. While, no doubt, if the two proceedings remain on foot separately, the orders and directions in one of the proceedings might be cross-referenced to the orders and directions in the other proceeding, such a process would be more cumbersome, and less efficient, than if the two proceedings are consolidated. In addition, there are a number of other issues which might emerge in the progress of the case to trial, which could involve unnecessary duplication, if an order for consolidation is not made. For example, the parties may need to issue similar, or identical, subpoena ad ducus tecum in each proceeding.

16 Thus, there are a number of factors which militate in favour of an order for consolidation of the two proceedings. The parties are identical in both proceedings. Although the subject-matter of the two proceedings is not the same, or "alike", for the purposes of s 23 of the Defamation Act, both proceedings are claims for defamation arising from the publication, by the defendants, of articles about the plaintiff in the same newspaper. There are some common allegations in the articles, which have caused the plaintiff to plead mere innuendoes which are common. There are some common issues of fact and law in the two proceedings. Thus, Mr Clarke correctly accepted that, if the two proceedings are not consolidated, they should be tried together. Consolidation of the two proceedings would save duplication of procedural steps, and lead to a more efficient, and less costly, disposition of the matters. The question, then, is whether an order for consolidation might cause unfair prejudice to the plaintiff.

17 In this regard, Mr Clarke was not able to identify any particular procedural, or other, inconvenience to the parties, or to the Court, if an order for consolidation were made. Nor, in my view, was he able to identify any unfair forensic disadvantage to his client, of the type illustrated by the decision of Herring CJ in Cameron v McBain, to which I have referred. Rather, at the forefront of his argument, was the proposition that if the two proceedings were consolidated, his client would become exposed to the risk that s 35 of the Defamation Act would be construed so as to apply one maximum limit to the amount of damages which might be awarded to the plaintiff, rather than, at the least, two such limits, one for each action. In this respect, my attention was drawn to the decision of McClellan CJ (at CL) in Davis v Nationwide News Pty Ltd,[13] in which his Honour held that s 35 of the Defamation Act prescribes a monetary maximum limit of damages which may be awarded in a proceeding, notwithstanding that the proceedings may involve multiple causes of action.

18 It is unnecessary for me to determine the correct construction of s 35 of the Defamation Act, and indeed it is undesirable that I express any view about it. It is sufficient, at this stage, for me to accept the submission of Mr Clarke that, if the two proceedings are consolidated, the plaintiff would be exposed to the risk that the one monetary maximum limit of damages will apply to his case, notwithstanding that there are a number of causes of action pleaded in it. However, I do not consider that that risk constitutes prejudice of the kind which should inhibit an order for consolidation of the two proceedings. I agree with the submission by Ms Schoff that, in this respect, the question of the "prejudice" contended for by the plaintiff does, in a real sense, cut each way. As I have already concluded, apart from the potential effect of s 35 of the Defamation Act, this is a case in which an order for consolidation ought to be made in the interests of avoiding a multiplicity of actions, and in the interests of the efficiency of the litigation. In those circumstances, if I were to decline the application for consolidation of the two proceedings, the defendants would sustain the unfair prejudice of being deprived of the potential benefit, which they might otherwise have derived from the application of s 35 of the Defamation Act. In other words, whatever decision I make in relation to the defendants' application for consolidation, one party's potential detriment will be the other party's potential advantage. That potential prejudice is quite different to the potential unfair prejudice which persuaded Herring CJ, in Cameron v McBain, not to make an order for consolidation of the three sets of proceedings in that case.

19 Thus, I consider that this is a case which is well suited for an order for consolidation of the two sets of proceedings. Such an order would conduce to the efficient and expeditious management and disposition of the claims made by the plaintiff. I do not accept that the making of such order would cause any prejudice to the plaintiff of the type recognised by the authorities. Accordingly, I uphold the application by the defendants that the two sets of proceedings be consolidated.

20 Accordingly, and subject to hearing from counsel, I intend to make the following orders:

Upon the terms stated in Order No. 2 below, proceeding No. 8575 of 2008 be consolidated with proceeding No. 10170 of 2007.
Order 1 is made on the following terms:

(a) The consolidated proceeding is to bear the number 10170 of 2007.

(i) The plaintiff be directed to amend his statement of claim so as to add the cause of action pleaded in the statement of claim in proceeding 8575 of 2008.

(ii) The defendants have leave to amend their defence so as to plead to the plaintiff's amended statement of claim.

(iii) The plaintiff have leave to file a reply to the amended defence.

(i) That the plaintiff file and serve his amended statement of claim in the consolidated proceeding within seven days of the date hereof.

(ii) The defendants file and serve their amended defence within 14 days of receipt of the amended statement of claim.

(iii) The plaintiff file and serve his reply to the amended defence within 14 days of the receipt thereof.

21 I shall hear the parties on the question of costs.

[1] Buckley v The Herald & Weekly Times Pty Limited and anor (No. 2) [2008] VSC 475.

[2] Buckley v The Herald & Weekly Times Pty Limited and anor [2008] VSC 459.

[3] Bolwell Fibre Glass Pty Ltd v Foley [1984] VicRp 8; [1984] VR 97, 100.

[5] See also Saker v Creative Land Management Pty Ltd and anor [2000] WASC 44, [2] (Sanderson M).

[8] See also Todd v Jones [1969] VicRp 19; [1969] VR 169, 171 (Newton J); Horwood v Statesman Publishing Co Limited and ors (1929) 45 TLR 237, 238.

[12] [1984] VicRp 8; [1984] VR 97, 100 (Young CJ), 104 (Brooking J).

[13] [2008] NSWSC 693 [8] to [10].

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