Federal Court of Australia|1993-03-26

Re Landsal Pty Ltd (In Liquidation); WA Reid Constructions Pty Ltd (In Liquidation); Andrew Thomas Abraham Reid; Franklyn Richard John White and Kathleen Carole White v Rei Building Society, Now the Co-Operative Building Society of South Australi [1993] FCA 121 (26 March 1993)

Re: LANDSAL PTY. LTD. (IN LIQUIDATION); W.A. REID CONSTRUCTIONS PTY. LTD. (IN

LIQUIDATION); ANDREW THOMAS ABRAHAM REID; FRANKLYN RICHARD JOHN WHITE and

Federal Court - inherent or implied jurisdiction - Court's implied jurisdiction to regulate its own procedures - preliminary determination of issues of fact and law - O. 29 of the Federal Court Rules does not exclude implied jurisdiction of Court to determine an issue or question before others.

Judgment and Orders - no judgment or order if judge publishes findings on some issues in case without intending to incorporate those findings in an order.

Practice - judge publishes preliminary findings of fact and law not intended to be incorporated in formal order - findings need not be incorporated in order where hearing and determination of particular issues conducted in exercise of implied jurisdiction rather than under O. 29 - appeal not competent as no judgment or order.

Ah Toy v. Registrar of Companies (1985) 10 FCR 280

Australian Telecommunications Commission v. Colpitts [1986] FCA 257; (1986) 12 FCR 395

Building Workers' Industrial Union of Australia v. Odco Pty. Ltd. [1991] FCA 87; (1991) 99 ALR 735

Computer Edge Pty. Ltd. v. Apple Computer Inc. [1984] HCA 47; (1984) 54 ALR 767

Doyle v. The Commonwealth [1985] HCA 46; (1985) 156 CLR 510

Driclad Pty. Ltd. v. Commissioner of Taxation [1968] HCA 91; (1968) 121 CLR 45

French Caledonia Travel Service Pty. Ltd. v. Elatri (Full Federal Court, unreported, 22 May, 1992)

Jackson v. Stirling Industries [1987] HCA 23; (1987) 162 CLR 612

Maybury v. Atlantic Union Oil Co. Ltd. [1953] HCA 89; (1953) 89 CLR 507

Miki Shoko Co. Ltd. v. Merv Brown Pty. Ltd. (1988) 10 ATPR 49,269

R v. Forbes; Ex parte Bevan [1972] HCA 34; (1972) 127 CLR 1

R v. The Judges of the District Court; Ex parte Kruger Enterprises (1982) QdR 623

R v. Robertson (1987) 3 WLR 327

TAG Pacific Ltd. v. McSweeney [1992] FCA 168; (1992) 106 ALR 651

Taylor v. The Attorney-General (1975) 2 NZLR 675

Town v. Australian Telecommunications Commission (1983) 47 ALR 137

Wentworth v. NSW Bar Association [1992] HCA 24; (1992) 66 ALJR 360

White v. Brunton (1984) QB 570

Counsel for the appellants: Mr. N.W. Morcombe QC and

Mr. P.D. Kerin

Solicitor for the appellants: Peter Kerin and Associates

Counsel for the respondent: Mr. D.J. Bleby QC and

Mr. P.D. Corkery

Solicitors for the respondent: Piper Alderman

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

KEELY, BURCHETT AND DRUMMOND JJ. The respondent in the action moved on notice for an order that an appeal instituted by the applicants in the action be dismissed as incompetent. On 10 November, 1992 this Court dismissed the appeal and said it would give its reasons later.

2. On 31 July, 1992, after hearing evidence from various witnesses, O'Loughlin J. published in a document which he entitled "Findings of Fact and Law" certain findings, together with his reasons for making those findings. By their notice of appeal, the appellants appealed "from part of the judgment ... and in particular from those parts of His Honour's findings of fact and law wherein" he made the findings particularised in the notice of appeal. They acknowledge that his Honour did not pronounce any order and that no formal judgment has been drawn up.

3. To explain why we dismissed the appeal as incompetent, it is necessary to go first to the amended statement of claim and then to what took place at directions hearings prior to the hearing which resulted in O'Loughlin J. making the findings we have referred to.

4. The case pleaded in the amended statement of claim by the appellants is as follows. The appellants, Messrs. Reid and White, were the directors and shareholders of the appellant Landsal Pty. Ltd., a property developer; Mr. Reid was also a director and shareholder of the appellant W.A. Reid Constructions Pty. Ltd., a building company. In November 1985, Landsal borrowed $1,600,000.00 from REI Building Society (whose liabilities the present respondent has assumed, following the amalgamation of the two societies) to fund construction for it of a residential project by Reid Constructions. Mr. Reid and Mr. White each guaranteed repayment of this sum to REI. In early September 1986, Landsal needed a further $140,000.00 to fund completion of the project. On 9 September REI agreed to advance this further sum. Between 9 September and 19 November, 1986, REI repeatedly assured Landsal that it would make the additional loan moneys available to it, although it is alleged that REI had already decided not to do so. On 18 November, REI told Landsal it would not make the additional loan. It is alleged that REI was in breach of its agreement to advance the further $140,000.00 and that REI's assurances given between 9 September and 18 November, 1986 amounted to conduct in breach of s. 52 of the Trade Practices Act 1974 and to deceit. In paragraph 29 of the amended statement of claim, it is alleged that, in reliance on REI's assurances with respect to the additional $140,000.00, Landsal and Reid Constructions continued work on the project and that Landsal did not seek an alternative source of the additional moneys it needed, but instead, it increased its overdraft with the State Bank of South Australia which went from $20,000.00 to $60,000.00 by 18 November, 1986, an overdraft in respect of which the appellants Mr. Reid and Mr. and Mrs. White had given guarantees to that bank.

5. Landsal and Reid Constructions ceased trading on 18 November, 1986 and were each wound up in early 1988. In October 1987, REI as mortgagee sold Landsal's partly completed development project for $1,100,000.00. Later, REI commenced proceedings on the guarantees given by Mr. Reid and Mr. White. In 1987, because Mr. Reid and Mr. and Mrs. White were unable to pay the amount of Landsal's overdraft with the State Bank which they had guaranteed, Mr. and Mrs. White granted the bank a mortgage over their home to secure repayment of the overdraft and are continuing to make monthly repayments in respect thereof.

6. The five appellants claimed a declaration that REI's conduct to which we have referred constituted a contravention of s. 52 of the Trade Practices Act; and a declaration that Landsal was not indebted to REI in any amount; or, alternatively, an order discharging Landsal from all liability to REI. The appellants Landsal and Reid Constructions claimed damages pursuant to s. 82 of the Trade Practices Act and damages for fraudulent misrepresentation, while Landsal also claimed damages for breach of contract. Mr. Reid and Mr. White sought, pursuant to s. 87 of the Trade Practices Act, a discharge of the guarantee they gave REI and Mr. and Mrs. White claimed damages pursuant to s. 82 of the Trade Practices Act.

7. Paragraphs 41 and 42 of the pleading contain the allegations that the conduct by REI which is complained of caused each of the appellants loss and damage, while paragraph 39 describes how such loss and damage occurred, as well as indicating the bases upon which Landsal, Mr. Reid and Mr. White seek orders extinguishing their liability to REI. It is there alleged that, but for REI's agreement to make the additional loan (an agreement REI is alleged to have breached) and but for REI's conduct between 9 September and 18 November, 1986 in assuring Landsal that these moneys would be advanced:

"39.1 Landsal would have arranged to borrow the

additional loan from alternative sources or

alternatively would have re-financed the development.

39.2 Landsal would have completed the development.

39.3 Landsal would have sold the development at a profit.

39.4 Landsal and Reid Constructions would not have gone into

liquidation.

39.5 (Mr. and Mrs. White) would not have given the mortgage or

any other charge over their home to the State Bank or any

other financial institution.

39.6 Landsal would have repaid the initial loan and the

additional loan to the respondent thereby enabling

Landsal to discharge its mortgage over the property.

39.7 (Mr. Reid and Mr. White) would have been discharged from

their liability under the REI guarantee.

39.8 (Mr. Reid and Mr. and Mrs. White) would have been

discharged from their liability under the State Bank

guarantee.

39.9 Landsal would have paid Reid Constructions for the work

that Reid Constructions contracted to perform upon the

development.

39.10 Reid Constructions would have paid its creditors

the moneys due to them for goods and services."

8. It is apparent from these claims and in particular from the allegations that but for REI's conduct complained of, Landsal would have completed and sold the development at a profit and that Landsal and Reid Constructions would not have gone into liquidation, that complex factual issues would have to be resolved in their favour before the appellants could establish that REI's conduct caused loss to the various appellants and before the quantum of the loss claimed by each appellant by way of damages could be determined.

9. These considerations explain the form the litigation took. On 19 October, 1990, well prior to the hearing, O'Loughlin J. made an order by consent that the matter proceed to trial on, and that discovery be limited to, questions of liability, reserving to the parties the right to argue questions of assessment of damage and loss at a later date.

10. Shortly before the hearing, on 19 September, 1991, O'Loughlin J. gave directions that supplanted those he had given in 1990. We were told by counsel for the respondent, without objection, that an application was made to the primary judge to revoke the directions of October 1990 to the intent that the trial would proceed in the ordinary way to its conclusion with a judgment being delivered disposing of all issues of liability and quantum. This application was not wholly successful. The directions given on 19 September, 1991 were the following:

"The direction is that the trial in this matter proceed on

Monday next, 23 September, at 10.15 upon the issues raised in

paragraphs 1 to 37 and 40 of the statement of claim and so much

of the relief as is sought, consistent with the limitation of

the evidence called in respect of the allegations contained in

the abovementioned paragraphs of the statement of claim.

The ... applicant(s) shall not be required to lead evidence on

the subject of causation in terms of the allegations contained

in paragraphs 39, 41 and 42, nor in respect of relief which may

be consequential upon all or any of those matters.

The third direction would be that no witness called by the

applicant for the purposes of leading evidence in terms of the

matters referred to in the first direction is to be released as

a witness in the trial without the express order of the court

and that on the contrary is to be made available for further

examination and cross-examination should that event arise in

respect of the subject of causation in terms of paragraph 39,

41 and 42 of the statement of claim."

11. The appellants submit that the objection to competency is an objection to form rather than substance and is for that reason bad. They submit that the trial judge should be taken to have proceeded under O. 29 of the Federal Court Rules and that, whilst he did not by his findings determine all the issues that had to be determined before liability could be resolved (at least in relation to the claims other than the claim by Landsal in contract), the findings were intended to be the operative judicial acts upon which the subsequent phase of the litigation would proceed and, as such, they comprised a judgment within s. 24 of the Federal Court of Australia Act 1976. That section limits this Court's appellate jurisdiction to hearing and determining, so far as is presently relevant, an appeal from a judgment - defined in s. 4 to mean "a judgment, decree or order, whether final or interlocutory, or a sentence" - of the Court constituted by a single Judge, with the proviso that an appeal from an interlocutory judgment cannot be brought unless this Court or a Judge gives leave to appeal. Reference was made to Driclad Pty. Limited v. Commissioner of Taxation [1968] HCA 91; (1968) 121 CLR 45, in which it was said at 64, in explanation of the proposition that an appeal to the High Court does not lie against the reasons for an order, that:

"... it is of the nature of appeals, as s. 73 of the

Constitution recognises, that they lie only against 'judgments,

decrees, orders and sentences', not against reasons. The word

'judgments' in this connexion refers only to operative judicial

acts, and is not used, as it often is in other contexts, as a

convenient abbreviation for reasons for judgment."

12. Under O. 29, r. 2, the Court is empowered to make orders for the decision of any question separately from any other question, whether before, at or after any trial or further trial in the proceedings. A question can be the subject of an order for a separate decision under this rule even though a decision on such a question will not determine any of the parties' rights. The term "question", by O. 29, r.1, includes any question or issue of fact or law in any proceeding. The distinction in the rule is between an "issue" in the sense of that which, when resolved, will result in an adjudication in favour of one party or the other and a "question", a term that embraces less decisive matters of dispute than "issues". See R v. The Judges of the District Court; Ex parte Kruger Enterprises (1982) QdR 623 at 626-7 and cf. R v. Robertson (1987) 3 WLR 327 at 333. It is clear from O. 29, rr. 3 and 4 that if this procedure is invoked, the Court is required, after having decided any separate question, to make such order, grant such relief or give such directions as the nature of a case requires. Where the decision of a question tried separately substantially disposes of the whole proceeding, r. 4 requires the Court to make an order reflecting that result. Such orders are, of course, orders from which an appeal lies under s. 24 of the Federal Court of Australia Act.

13. If a judge can be seen to have dealt with a question in the litigation as a separate issue under O. 29, Town v. Australian Telecommunications Commission (1983) 47 ALR 137 shows that an appeal will lie from such a determination, even though the judge may not have made a formal order reflecting that decision, as is required by r. 3 or 4. In that case, the judge at first instance gave a decision on a question of law against a background of agreed facts; this question was at the core of the dispute between the parties. This Court considered the competency of the appeal, despite the agreement of the parties that an appeal lay.

14. McGregor J. said, of O. 29 of the Federal Court Rules, at 145:

"The Order itself, in my view, distinguishes between the

deciding of questions and what may follow - in an appropriate

case - i.e., the making of an order or granting relief or

giving directions or finally, for example, the pronouncing of

judgment ... We have not been referred to any specific order

made by the learned judge referable to that order; yet it is

implicit on a consideration of the whole matter that the judge

proceeded as if such an order were made ... with the

concurrence of all parties. We should therefore, I consider,

accept that he proceeded as if the orders were made. We need

not concern ourselves with a consideration that, for example,

there was a failure by him to take some procedural step which

was available and acquiesced in by the parties ...".

15. Sheppard J., with whom Franki J. agreed, said, in relation to O. 29, at 150:

"In the light of these provisions I conclude that his Honour,

in accepting the parties' formulation of the questions and

determining the answers to them, was acting pursuant to the

provisions of O. 29 of the Rules. It is unnecessary,

therefore, to enquire whether there was any other source of

power for the course which was taken ...

His Honour having found against the appellant, it is

superficially difficult to perceive what order his Honour has

made. Unless there is an order - there is certainly no

judgment - there can be no appeal pursuant to s. 24 (of the

Federal Court of Australia Act) because there is nothing to

appeal against. But it seems to me that in deciding to answer

the question in the way that he has, his Honour has, in

reality, made an order determining the question favourably to

the respondents. The order is not a final order but an appeal

lies against an order which is interlocutory only."

16. Although the trial judge had not made any formal order, this Court concluded that he had acted under O. 29 in determining the question of law by deciding it against one party and in favour of the other: he had done something which r. 3 of that Order required to be done by the pronouncement of a formal order. It was for this reason that the Court regarded the appeal as competent, even though the trial judge had not in fact pronounced any order.

17. If O'Loughlin J. must be taken to have proceeded under O. 29 in giving the directions of 19 September, 1991, the Town case would support the appellant's argument that the findings made by his Honour should be regarded as equivalent to orders and thus open to appeal.

18. But the directions then made were not expressed to be given pursuant to O. 29, r. 2. Moreover, in his reasons, O'Loughlin J. said:

"During the pre-trial processes, it was agreed by the parties

that it would be expeditious to proceed to the trial of certain

limited issues, leaving for a later date questions of the

quantification of damages if and when they should arise; it is

for this reason that these remarks are described as "Findings

of Fact and Law"; in due course the parties would be able to

make their submissions on the further prosecution of these

proceedings.

...

As the parties have agreed that I should make findings of fact

and law on the evidence thus far led, so that they may

thereafter assess their positions, I state the following

conclusions.

...

After the parties have had the opportunity to consider these

findings, it will be necessary for the matter to be relisted

for further hearing. I reserve to all parties liberty to have

it relisted on seven days notice; I also reserve for argument

the question of costs to date." (emphasis added)

19. These passages suggest that when O'Loughlin J. published his findings and reasons, he did not intend to make an order reflecting any of those findings. Rather do they suggest that his Honour regarded the publication of the findings as but one step in the hearing of the case, which would be resumed and would proceed until the trial was finished, when his Honour would give judgment, unless the parties in the meantime were able to settle the litigation after considering his findings.

20. His Honour made all the findings necessary to dispose of Landsal's claim for damages for breach of contract and could, if he had wished, have made an order disposing of that particular claim: page 30 of his reasons. His Honour also made findings that the allegations that REI was guilty of misleading or deceptive conduct in breach of s. 52 of the Trade Practices Act and of fraud were well-founded, but only in respect of REI's failure between 10 or 11 November and 18 November, 1986 to inform Landsal of its decision not to make the additional advance: pages 31 and 32 of his reasons. The appellants, in their amended statement of claim, expressly sought a declaration that REI's conduct, in failing to inform them of its decision no longer to make the loan available, constituted conduct in breach of s. 52 of the Trade Practices Act. His Honour, having expressly so found, was entitled, but not compelled, to make that declaration. That O'Loughlin J. did not make the declaration sought, that REI's conduct contravened s. 52, or an order dismissing Landsal's claim for damages for breach of contract, is further evidence that he deliberately refrained from making any order based on those findings.

21. We do not think his Honour proceeded under O. 29. We think instead that his Honour decided to hear the trial in two phases, because he accepted that there were advantages to the parties if he were to deal with important matters upon which a determination of liability would in large part depend, and then give the parties an opportunity to consider their position, before completing the hearing.

22. It is conceded that there is power to follow such a course and that this involved a procedure different from that provided for by O. 29, r. 2. We think this concession was rightly made.

23. The English Supreme Court Practice, in the annotations to rules equivalent to O. 29, r. 2, has long contained the following note: "Apart from these rules, the trial judge has inherent jurisdiction to try any separate issue or question before the others." See now the Supreme Court Practice, 1991, para. 33/4/5.

24. It is now beyond question that the Federal Court, like differently constituted superior Courts, has all the powers that are necessary to ensure the proper administration of justice in the cases that come before it, including power to control the processes and proceedings of the Court. Section 38 of the Federal Court of Australia Act does not deny the Court power to control its procedures to ensure the proper administration of justice. Whether or not these are properly called inherent powers, in the sense referred to by Menzies J. in R v. Forbes; Ex parte Bevan [1972] HCA 34; (1972) 127 CLR 1 at 7, so far as the Federal Court is concerned, they are certainly powers to be found by implication in the Federal Court of Australia Act 1976, the statute under which the Court is established: see Jackson v. Stirling Industries Ltd. [1987] HCA 23; (1987) 162 CLR 612 at 616, 618, 619, 623-4 and 640-2 and Hamilton v. Oades [1989] HCA 21; (1989) 166 CLR 486 at 516.

25. This Court's implied power to regulate its own procedures in the administration of justice in a particular regard is not confined to a situation in which there is no statute or rule of court that could possibly apply to what is to be done in that regard. The true rule is that a Court may exercise its inherent or implied powers in a particular case, even in respect of matters that are regulated by a provision of a statute or rules of court, so long as it can do so without contravening any such provision: see Taylor v. The Attorney-General (1975) 2 NZLR 675 at 680, 687-8 and 692-3. Cf. Wentworth v. NSW Bar Association [1992] HCA 24; (1992) 66 ALJR 360 at 364.

26. Hamilton v. Oades provides an example of the denial of any entitlement of a Court to rely upon its inherent jurisdiction to circumvent a statutory abrogation of the right against self-incrimination. Doyle v. The Commonwealth [1985] HCA 46; (1985) 156 CLR 510, provides an example of the denial of the availability of the inherent jurisdiction as a source of power to do, free of restraint, that which a rule of court confers power to do, but only subject to certain restraints. There, the Court held that there was no inherent jurisdiction to make an ex parte order for committal for breach of an injunction, there being a rule of court that permitted such an ex parte order, but only subject to the Court being satisfied that delay caused by proceeding in the ordinary way on notice might entail irreparable mischief. At page 518, the Court said:

"... a judge cannot dispense with the requirements of the Rules

of Court unless the Rules give him power to do so, and when a

power is expressly conferred on the court subject to a

condition, a judge cannot, by relying on inherent powers,

escape from the necessity of ensuring that the condition has

been fulfilled."

27. There is nothing in O. 29 that indicates that that Order is the sole source of power in the Court to determine an action in parts. The Order is really not concerned with that concept at all. Rather is it concerned to ensure that the Court has power to determine a particular question or issue otherwise than in a judgment that disposes of the entire proceeding. The Order does not limit the implied power of the Court to conduct the trial of an entire action by a procedure that will best conduce to the efficient disposition of the whole litigation. The course O'Loughlin J. followed here was open to him as an exercise of the implied power of the Court, even though O. 29 was available to him as a source of power which he could have used, if he had wished, to dispose separately of the questions the subject of his directions of 19 September, 1991.

28. It is, we think, clear from the passages in the reasons to which we have referred and from the other considerations which we have mentioned that his Honour did not intend to make any order incorporating his findings. This is so even though, in accordance with the request of the parties, he embarked on a limited hearing pursuant to the directions he had given on 19 September, 1991 and even though, in accordance with the parties' request, he published the findings he was prepared to make up to that stage of the proceeding, together with his reasons. And since O'Loughlin J. did not proceed under O. 29, he was not bound by any rule of court or other requirement to pronounce an order reflecting his findings.

29. We think this conclusion is fatal to the appellants' proposition that it is entitled to appeal against these findings.

30. In French Caledonia Travel Service Pty. Limited v. Elatri (Lockhart, Gummow and Foster JJ., unreported, 22 May, 1992) leave was sought to appeal from what was said to be an interlocutory judgment; in that case, the trial judge, after a hearing limited to the question of liability, gave oral reasons in support of a finding that the issue of liability should be resolved in favour of the respondent. His Honour said: "In my view the plaintiff is entitled to a declaration in the terms of claim 1 in the summons", and he proceeded to give directions for the hearing of the remaining questions. On a subsequent directions hearing, the judge stated that although he had expressed the opinion that the plaintiff was entitled to the declaration already referred to, he had not yet made a declaration, or anything which could be regarded as a final order or part of a final order, quite deliberately because, as he put it, he preferred to complete the hearing of the case before making any orders. This Court, after referring to s. 24 of the Federal Court of Australia Act and to the definition of "judgment" in s. 4, upheld an objection taken to the competency of the appeal, saying:

"As this is an application for leave to appeal, the Court must

be satisfied that the applicant for leave has established that

there is an interlocutory judgment susceptible of appeal. The

Court is not so satisfied. In our opinion, all that his Honour

did, so far as presently relevant, was to give reasons to

support a finding on the issue of liability in favour of the

respondent and expressly declined to make any order or

declaration at that stage to give effect to his finding."

31. The trial judge there had clearly reached a conclusion in favour of the plaintiff on the whole issue of liability. A declaration to that effect apparently was claimed by the plaintiff in the proceedings. Yet it was solely because the Judge made it clear that he did not intend to incorporate his decision on liability into a formal order that the Full Court held that there was no judgment or order capable of being the subject of an appeal.

32. The appellant here relied on the decisions in Driclad Pty. Limited v. Commissioner of Taxation [1968] HCA 91; (1968) 121 CLR 45 and Ah Toy v. Registrar of Companies (1985) 10 FCR 280 as showing that if a judge has made a determination on a matter, then he has finally determined the rights of the parties with respect to that matter and the determination is an "operative judicial act" which is appealable.

33. In Driclad, the trial judge pronounced an order which finally disposed of the litigation. Although in form the order determined the proceeding in favour of the taxpayers, the judge's reasons showed that he had disposed of the issues in the litigation only partly in their favour. For there were also determinations adverse to them, in circumstances in which it was open to the Commissioner to assess the taxpayers afresh on the basis of the adverse determinations, which the taxpayers would be estopped from disputing, unless they could challenge them in an appeal from the trial judge's order. The case thus involves an order finally disposing of litigation but which did not reflect the reasoning and conclusions of the trial judge or the effect of those conclusions on the rights of the parties as accurately as an order differently framed could have done: see 121 CLR at 63 and 69. It was held in these special circumstances that, since the taxpayers could have framed their appeal to seek orders overturning the trial judge's adverse determinations, the appeal was competent. It is a similar case to Australian Telecommunications Commission v. Colpitts [1986] FCA 257; (1986) 12 FCR 395, where an objection that an appeal was not against the trial judge's order declaring certain administrative decisions invalid but only against his reasons for that declaration was overruled: Jackson J. said, at p. 411, that he could "see no reason why, as in Driclad, an appeal which seeks to limit the effect of the order of the primary judge in a distinct and separate respect is not competent, particularly where the method of limitation sought is by the making of declarations which it is contended are more appropriate."

34. Ah Toy v. The Registrar of Companies (1985) 10 FCR 280 involved an objection to the competency of an appeal that arose out of an inquiry into the conduct of a liquidator conducted in the Supreme Court pursuant to s. 278 of the Companies Act (NT). The judge completed the inquiry and delivered reasons, in the course of which he made a number of findings adverse to Ah Toy. The respondent Registrar took out a formal order giving effect to those findings which held that Ah Toy had caused certain losses to the company by his misconduct. The matter of present relevance, however, is the challenge to the competency of the appeal with respect to certain other findings adverse to Ah Toy which did not relate to those upon which the formal orders for reimbursement were made. The Court overruled this challenge and said of these particular findings, at 286-7:

"While those findings have not been incorporated in the formal

judgment of the court, they are all, with the exception of (n),

matters that might fairly be the subject of declaratory relief

and in truth this is the part they have played in his Honour's

reasons for judgment. It was the conduct of the appellant as

liquidator that was the subject of the inquiry and it was the

conduct of the appellant as liquidator that constituted a

number of findings of the Chief Justice. In our view those

findings purported to determine the rights and obligations of

the liquidator who was undoubtedly a party to the inquiry. In

our further view the notice of appeal, so far as it attacks

those findings, attacks the judgment of the court." (emphasis added)

35. The trial judge was there exercising a jurisdiction which required him to make final pronouncements on the conduct of the liquidator: it was just that which his Honour did by making the findings attacked in the notice of appeal. Although in form the matters complained of in the notice of appeal were findings by the trial judge, in substance they constituted the determinations that the judge was required to make in order to dispose of the litigation. Thus Ah Toy too is a case like Driclad in which the trial judge can be seen to have intended to dispose, in a final way, of all the issues in the litigation which he was required to resolve, even though he had not formally incorporated all those determinations in an order of the Court, as he could have done. Nor does this case establish the proposition put forward by the appellants, that there will be an appealable judgment or order if findings can be put into the form of declarations, as will often be possible: except for a statutory ouster, there is no limitation on the discretionary jurisdiction to grant declaratory relief. See Meagher, Gummow and Lehane, Equity Doctrines and Remedies, 3rd Ed., para. 1919. It was because the findings made in Ah Toy were final determinations that disposed of the litigation that it was held that it would be proper, as a matter of discretion, to put them into the form of a declaratory judgment, which would necessarily be appealable.

36. Driclad and Ah Toy stand in sharp contrast to the present case. Here, O'Loughlin J. was not exercising a jurisdiction which required him to make any final determination on the issues the subject of his findings. He was therefore entitled to refrain from incorporating his findings in an order which, if made, would have been appealable. He not only deliberately refrained from finally disposing of the limited range of issues upon which he reached his conclusions, which he could have done if he had chosen to incorporate his findings in an order, but also deliberately left himself with the task of determining all the outstanding issues of causation and quantum and the relief that should be granted before he would complete his function of hearing the litigation (if the litigation did not settle). There will come a stage when a judge who is conducting the trial of a cause of action will be bound to end his involvement in the matter by making an order or giving a judgment that finally disposes of the suit and which is appealable. But O'Loughlin J. plainly has not yet reached that stage here.

37. Unless the case is one in which the judge has pronounced a judgment or order or can be seen to have intended to do that, we do not think it is open to a litigant to appeal from a determination made in the course of a hearing, which does not necessarily dispose of any question in the litigation, irrespective of the finality with which the judge may have expressed himself in making the determination. It may be appropriate to infer that the judge intended to make an order if the case is one in which he was required by the particular procedure he followed to conclude the matter by giving a judgment or by making an order. It is not to the point that the litigant desirous of appealing is able, by a process of appropriate drafting, to reflect the effect of the ruling or determination in the form of a declaration. That does not assist in conferring a right of appeal where the judge himself, not being bound to do so, has declined to make such a declaration.

38. If, in the exercise of his inherent jurisdiction, a judge decides to conduct a trial in separate parts, there is no requirement that he make an order reflecting the conclusions he has reached part way through the hearing. Whether a judge, in exercising this particular jurisdiction has reached a conclusion on some of the issues part way through the task, which can be immediately made the subject of an appeal, depends upon whether he has either formally incorporated those conclusions in an order or can be seen to have intended to have done that. If in such a case it can be seen that the judge did not intend to make an order reflecting conclusions he has reached part way through conducting the trial of a matter, then there is nothing that can be the subject of an appeal, whether by leave or as of right.

39. White v. Brunton (1984) QB 570 and TAG Pacific Ltd. v. McSweeney [1992] FCA 168; (1992) 106 ALR 651 provide no support for a contrary view. In both cases the judge who heard a preliminary issue made an order disposing of that issue. See pages 571 and 653 of the respective reports. It is unnecessary to consider the correctness of the ruling of Olney J. in TAG Pacific that an appeal against a judgment for damages to be assessed, pronounced after a hearing of issues restricted to liability, was to be regarded as an appeal against a final, and not an interlocutory, judgment for the purposes of s. 24 of the Federal Court of Australia Act. But the ruling does not appear to be consistent with Computer Edge Pty. Ltd. v. Apple Computer Inc. [1984] HCA 47; (1984) 54 ALR 767 and Miki Shoko Co. Ltd. v. Merv Brown Pty. Ltd. (1988) 10 ATPR 49,269 at 49,276, where judgments including some final orders were held not to be final judgments because issues related to damages had been left outstanding. See also Town per Sheppard J. at 150, Franki J. agreeing, and Maybury v. Atlantic Union Oil Co. Ltd. [1953] HCA 89; (1953) 89 CLR 507 at 515 and Building Workers' Industrial Union of Australia v. Odco Pty. Ltd. [1991] FCA 87; (1991) 99 ALR 735 at 738, which are cases relevant to the question whether an order determining a preliminary issue is itself final or interlocutory, and thus appealable as of right or only by leave.

40. For these reasons, the Court dismissed the present appeal with costs, it being incompetent.

Court of Australia Act 1976

Re Landsal Pty Ltd (In Liquidation); WA Reid Constructions Pty Ltd (In Liquidation); Andrew Thomas Abraham Reid; Franklyn Richard John White and Kathleen Carole White v Rei Building Society, Now the Co-Operative Building Society of South Australi [1993] FCA 121

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Judgment (81 paragraphs)

Re Landsal Pty Ltd (In Liquidation); WA Reid Constructions Pty Ltd (In Liquidation); Andrew Thomas Abraham Reid; Franklyn Richard John White and Kathleen Carole White v Rei Building Society, Now the Co-Operative Building Society of South Australi [1993] FCA 121 (26 March 1993)

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Legislation Cited (2)

Cases Cited (15)