Robbins v The Royal Bank of Scotland plc [2010] NSWSC 39 | Case summary

2009/290239 THOMAS HAMILTON ROBBINS & ANOR v THE ROYAL BANK OF SCOTLAND plc JUDGMENT 1 The defendant applies under rule 28.2 of the Uniform Civil Procedure Rules 2005 for an order that the court decide, as a separate question and in advance of the trial, "whether the relevant limitation period under the Limitation Act 1969 has expired". The plaintiffs oppose the making of any such order. 2 The plaintiffs' case is pleaded in a statement of claim filed on 24 August 2009. Their allegations are brief and may be set out in full: "1. The Plaintiffs entered into an agreement with the Defendant for the Defendant to hold in Trust and as Nominee for the Plaintiffs 65,389 ordinary shares in Woodside Petroleum Limited ('the Shares'). 2. The Plaintiffs requested the Defendant to deliver the Shares back to the Plaintiffs. 3. Despite repeated demands the Defendant has failed and/or refused to deliver the Shares to the Plaintiffs. 4. The Defendant has failed to account to the Plaintiffs for the dividends declared on and paid in respect of the Shares from time to time." 3 Particulars of dividend payment dates and dividend amounts are then given. 4 The plaintiffs claim: "1. Delivery of 65,839 ordinary shares in Woodside Petroleum Limited. 2. Alternatively damages. 3. Interest on dividends on the said 65,839 shares from 1992 to date of judgment. 4. Costs." 5 The defendant filed a defence on 26 October 2009. The gist of its defence is that, whereas the defendant did in August 1983 hold 27,865 shares in Woodside Petroleum Limited and 37,974 shares in Woodside-Burmah Oil NL on behalf of the plaintiffs, it later transferred to a Swiss bank all shares held on behalf of the plaintiffs; and did so at the plaintiffs' request. It is the defendant's contention that it did not hold the shares in question on the plaintiffs' behalf after 4 May 1988. The defendant further says, in answer to the whole of the statement of claim, that the action is statute barred. 6 Submissions on the present motion were made on the footing that the relevant provision of the Limitation Act 1969 is s 14(1)(d) or s 47(1)(c), depending upon whether the claim, as pleaded, is a cause of action founded on contract or a cause of action for the recovery of trust property. In the first case (apparently favoured by the defendant), an action is not maintainable on the cause of action if brought after six years from the date on which the cause of action first accrued to the plaintiffs. In the second case (the potential application of which was referred to by Ms Kerr of counsel on behalf of the plaintiffs), the limitation period is twelve years from the date on which the plaintiffs first discovered or may with reasonable diligence have discovered the facts giving rise to the cause of action and that the cause of action has accrued. 7 It is not possible to say with any certainty what course the trial might take. The plaintiffs have not yet put on any evidence, but it is clear from correspondence put into evidence on the hearing of the present motion that the first plaintiff had telephone conversations with Mr Cadger, an officer of the defendant in London, in 1992 and 2001. He may choose to give evidence about these. It is also clear that there is contemporary correspondence of relevance, although it does not appear at this point to be extensive. In the defendant's case, no evidence will be given by Mr Cadger (who died in 2007) but the defendant may seek to show receipt of the relevant portfolio by the Swiss bank so as to establish the composition of the portfolio at the time of transfer. 8 I have mentioned these matters to make it clear that the matter is not, on the face of things, a particularly complex one and that it is unlikely to entail a protracted hearing. The factual questions seem to be confined to whether the defendant did, with the plaintiffs' concurrence, cease to hold the shares in question and, if so, when that happened. 9 The attractions of trials of issues rather than cases in their totality are "often more chimerical then real": Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1 per Kirby J and Callinan J at [168]. In addition, it is "undesirable that limitation questions … should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases": Wardley Australia Ltd v State of Western Australia [1992] HCA 55; (1992) 175 CLR 514 at 533 per Mason CJ, Dawson J, Gaudron J and McHugh J. 10 Mr Durack SC, who appeared for the defendant, acknowledged these realities. He submitted, however, that the observation in Wardley Australia Ltd v State of Western Australia is confined, in terms, to the determination of limitation questions in interlocutory proceedings and that the determination of a separate question under rule 28.2 is not of that character, since it produces a result that binds the parties on a final basis subject only to appeal: O'Toole v Charles David Pty Ltd [1991] HCA 14; (1991) 171 CLR 232. 11 Mr Durack also submitted that the approach to applications under rule 28.2 has been modified by ss 56(1) and (2) of the Civil Procedure Act 2005: "(1) The overriding purpose of this Act and of rules of court, in their application to civil proceedings, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. (2) The court must seek to give effect to the overriding purpose when it exercises any power given to it by this Act or by rules of court and when it interprets any provision of this Act or of any such rule." 12 Mr Durack referred to the following observation of Brereton J in Integral Home Loans Pty Ltd v Interstar Wholesale Finance Pty Ltd [2006] NSWSC 1464 at [6]: "While much has been said against the resolution of separate questions in Courts of high authority, nonetheless, since the (NSW) Civil Procedure Act 2005, it is my view that the Court should take a more interventionist role in identifying and separating important issues which can resolve significant parts of the litigation expeditiously." 13 As Hoeben J noted in Johnson v Trustees of the Roman Catholic Church [2009] NSWSC 309, the comments of Brereton J have been adopted and applied in a number of first instance decisions. It may be accepted, therefore, that the "more interventionist role" to which Brereton J referred is one that the court should prefer in an appropriate case. 14 The general considerations to be taken into account upon an application of this kind were stated by Einstein J in Idoport Pty Ltd v National Australia Bank Ltd [2000] NSWSC 1215 at [7]: "Without examining specific cases in relation to the power conferred on the Court in Part 31, Rule 2, I proceed on the basis of the following principles. (1) The power of the Court to order the separate determination of an issue is a discretionary power which must be exercised judicially, but cannot otherwise be fettered: Dunstan v Simmie & Co Pty Ltd [1978] VR 699 at 670 per Young CJ and Jenkinson J. (2) In exercising the power under Part 31, Rule 2, the Court is now enjoined to give effect to the overriding purpose of the Supreme Court Rules ; namely to facilitate the just, quick and cheap resolution of the real issues in the proceedings and cannot be stated in a more confined way: Part 1, Rule 3 (1), (2) Supreme Court Rules . (3) The Court begins with the proposition that it is ordinarily appropriate that all issues in a proceeding should be disposed of at the one time: Tallglen v Pay TV Holdings Pty Ltd (1996) 22 ACSR 130 at 141 per Giles CJ in Comm D, Hadid v Australis Media Ltd (unreported, Supreme Court of NSW, 29 March 1996 per Rolfe J). Accordingly, it is for the party who wishes to have a question separately determined to show that it is desirable for that to occur. (4) Without being exhaustive, the separate determination of an issue may prove to be an appropriate procedure in at least the following sets of circumstances: (a) where the resolution of that separate issue will have the effect of resolving the entirety of the litigious controversies or of substantially narrowing the field of litigious controversy : CBS Productions Pty Ltd v O'Neil [1985] 1 NSWLR 601 at 606 per Kirby P, Dunstan v Simmie & Co Pty Ltd (supra, at 671 per Young CJ and Jenkinson J); (b) where the resolution of that separate issue carries with it a strong prospect that the parties will thereafter be able to resolve their dispute themselves and thus avoid further litigation: Tallglen v Pay TV Holdings (supra, at 141 - 142 per Giles CJ in Comm D); (c) where there is a clear demarcation between that issue and all other issues in the case, including issues going to the credit of witnesses: CBS Productions Pty Ltd v O'Neil (supra, at 606 per Kirby P), Tallglen v Pay TV Pty Ltd (supra, at 142 per Giles CJ in Comm D), Rajski v Carson (1988) 15 NSWLR 84 at 88 per Kirby P and Hope JA. (5) Conversely, the separate determination of an issue will rarely be an appropriate procedure where: (a) there are intertwined issues of fact or law between the separated question and the other questions such that the determination of the separate question will not have any substantial effect upon the width of the field of litigious controversy or the prospect of the settlement of the balance of the litigation: Law Society of NSW v Bruce (unreported, Supreme Court of NSW, 23 April 1996, per Rolfe J), Parramatta Stadium Trust v Civil and Civic Pty Ltd (unreported, Supreme Court of NSW, 27 August 1996, per Hunter J). (b) where there is a commonality of witnesses and issues of credit as between the separate issue and other issues in the case which will or may necessitate a ruling on the credit of one or more of the common witness, thus possibly precluding that same judicial officer from again dealing with the matters going to the credit of the common witness in accordance with the decision of the Court of Appeal in Australian National Industries Ltd v Spedley Securities Ltd (in liq ) (1992) 26 NSWLR 441 : Story of Sydney Pty Ltd v Ling (unreported, Supreme Court of NSW 15 November 1994, per Rolfe J), Century Medical v THLD [2000] NSWSC 5; (unreported, Supreme Court of NSW, 3 February 2000, per Rolfe J). (c) there is a possibility that the resolution of the separate issue will not finally determine the issue but will merely result in an appeal from that decision in relation to that separate issue, creating a multiplicity of proceedings, interruption to the court and undesirable fragmentation of the proceedings: Story of Sydney Pty Ltd v Ling (supra), Century Medical v THLD (supra). (6) The experience of courts suggests that the separation of proceedings often does not result in the quicker and cheaper resolution of proceedings as anticipated, but often has the reverse effect, merely causing added delay and expense to the resolution of the litigation. Thus, before an issue is to be separately determined, it must be possible to clearly see that it will facilitate the quicker and cheaper resolution of the proceedings: Tallglen v Pay TV Pty Ltd (supra, at 142 per Giles CJ in Comm D), Parramatta Stadium Trust v Civil and Civic Pty Ltd (supra), Century Medical v THLD (supra)." 15 Factors in favour of the order the defendant seeks are that, if the limitation question is resolved in favour of the defendant, the proceedings will be at an end and that there is a clear demarcation between that issue and all others. These, coupled with the apparent absence of contrary factors of the kind referred to by Einstein J at (5)(a) to (c) and the strong likelihood that the factual context for addressing the separate question will be a confined one, lead me to conclude that an order for separate determination will, in this case, best promote the s 56(1) objects. 16 I therefore make the order sought in the notice of motion.

Robbins v The Royal Bank of Scotland plc

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