Sirius Shipping Corporation v The Ship 'Sunrise' & Ors

LEGISLATION CITED : Uniform Civil Procedure Rules 2005 (NSW) - 20.14, 36.11, 36.16

• Bailey v Marinoff (1971) 125 CLR 529 - D v Director General, Department of Community Services [2005] NSWCA 474 - DJL v Cental Authority (2000) 201 CLR 226 - Jones v R (1989) 166 CLR 409 - Mulholland v Mitchell [1971] AC 666 - Meier v Meier [1948] P 89 - Orr v Holmes (1948) 76 CLR 632 - Pantorno v R (1989) 166 CLR 466 CASES CITED : - Postiglione v R (1997) 189 CLR 295 - R v Giri (No 2) [2001] NSWCCA 234 - R v Lapa (No 2) (1995) 80 A Crim R 398 - R v Bow Street Magistrate; Ex parte Pinochet Ugarte (No 2) [2000] 1 AC 119 - R v Burrell [2007] NSWCCA 79 - Sirius Shipping Corp v Ship Sunrise [2006] NSWSC 398 - Sirius Shipping Corp v Ship Sunrise [2006] NSWSC 1393 - State Rail Authority of New South Wales v Codelfa Construction Pty Ltd (1982) 150 CLR 29 - Wentworth v Rogers (No 3) (1986) 6 NSWLR 642

Sirius Shipping Corporation - Plaintiff The Ship 'Sunrise' - Defendant PARTIES : Richard Evans - First Relevant Person Capital Finance Australia Ltd - Second Relevant Person Hunt Pacific Finance Pty Ltd - Third Relevant Person

COUNSEL : R.J. Carruthers - Second Relevant Person/Respondent J.M. White - Third Relevant Person/Applicant

SOLICITORS : Bartier Perry - Second Relevant Person/Respondent Swaab Attorneys - Third Relevant Person/Applicant

0006/03 Sirius Shipping Corporation v The Ship 'Sunrise'

1 This an application for costs orders in proceedings heard by another Judge of the Court. The principal issue is whether the proceedings in which the costs orders are sought have been finally determined so that the Court is now functus officio. 2 In brief, the applicant, Hunt Pacific Finance Pty Ltd ("Hunt Pacific") was joined in the proceedings in a cross claim ("the First Cross Claim") and subsequently filed its own cross claim ("the Second Cross Claim"). The trial judge made orders granting some of the relief claimed in the First Cross Claim, but he did not expressly deal with the relief claimed against Hunt Pacific. His Honour was of the view that that relief had become unnecessary in view of the disposal of claims as between the other parties to the proceedings. 3 For the same reason, the relief claimed in Hunt Pacific's Second Cross Claim became unnecessary, in his Honour's view, and his Honour dismissed that cross claim as otiose, although he expressly reserved the question of costs. 4 Hunt Pacific now seeks a costs order in its favour in both the First Cross Claim and Second Cross Claim. The Cross Claimant in the First Cross Claim says that the Court has finally disposed of that cross claim and it cannot make any further order in relation to it, not even a costs order. As to the costs of the Second Cross Claim, it says that there are discretionary reasons why Hunt Pacific's application for costs should be refused. 5 Unfortunately, the matter is so complex that a fairly detailed review of the proceedings is necessary.

6 The Plaintiff ("Sirius") was the owner of the ship 'Sunrise'. In December 2000 Sirius entered into an agreement with Mr Richard Evans to sell the ship to Mr Evans for the sum of $1M, payable in two instalments. The agreement required completion by 15 January 2002. 7 On 21 February 2001, Sirius and Mr Evans entered into a new agreement which replaced the earlier agreement. Sirius received payment of $600,000 on 21 February 2001 and was to receive the balance of the purchase price of $400,000 by a transfer of shares. Mr Evans took possession of the ship, but Sirius never received payment of the balance of the purchase price. It gave notice to Mr Evans terminating the sale agreement and requiring him to deliver up possession of the ship. 8 However, Mr Evans was no longer in possession of the ship. He had sought finance for the purchase from a finance broker, Hunt Pacific. Hunt Pacific introduced Mr Evans to Capital Finance Australia Ltd ("Capital Finance"). Capital Finance agreed to finance Mr Evans' acquisition of the ship by means of a purchase and lease-back agreement, in the nature of a hire purchase agreement. 9 Capital Finance then acquired the ship from Sirius - or so it believed. The sale was recorded in a tax invoice dated 15 February 2001, apparently issued by Sirius. It stated that of the purchase price of $1M, a deposit of $400,000 had already been paid, so that Capital Finance paid Sirius $600,000. Capital Finance then entered into a hire purchase agreement with Mr Evans. 10 Mr Evans defaulted under the high purchase agreement and Capital Finance took possession of the ship on 16 April 2003. 11 Sirius claimed, however, that it had not been paid the balance of the purchase price, namely $400,000, under the agreement with Mr Evans which it had entered into in February 2001. Sirius said that it had the benefit of a retention of title clause in its agreement with Mr Evans and that that agreement was the only operative agreement for sale of the ship. Sirius said that it had not agreed to sell the ship to Capital Finance, as evidenced in the tax invoice. Sirius said, in effect, that the tax invoice was a false document. 12 On 18 July 2003, Sirius gave notice to Capital Finance claiming ownership of the ship and demanding its return. Capital Finance refused to comply with the demand. 13 By Writ filed in the Admiralty List of the Court on 26 September 2003, Sirius commenced an action in rem against 'Sunrise'. It claimed a declaration that it was the legal and beneficial owner of the ship and an order that Capital Finance surrender possession. In the Particulars to the Writ, Sirius claimed that it had sold 'Sunrise' to Mr Evans pursuant to an agreement containing a retention of title clause, that Mr Evans had defaulted in payment under the agreement, that it had terminated the agreement and demanded return of the ship, but Mr Evans had failed to comply. Sirius further claimed that Capital Finance had possession of the ship but Sirius denied selling the ship to Capital Finance. The Writ was served on Mr Evans and Capital Finance as Relevant Persons. 14 On 7 November 2003, Sirius filed a Statement of Claim in which the claims against Mr Evans and Capital Finance made in the Writ were pleaded in a little more detail. The proceedings were extensively case-managed from October 2003. Eventually, after considerable delay and several interlocutory applications, the proceedings came on for hearing before Young CJ in Eq on 13 March 2006. 15 As at the commencement of the trial, the state of the pleadings and the issues for trial were as follows. 16 Sirius maintained its claims to absolute title to the ship as against Mr Evans and Capital Finance, as set out in the Statement of Claim. 17 Mr Evans, who had proved very difficult to serve, had not filed a Defence, was not represented during case management hearings, and did not appear at the trial. 18 Capital Finance had filed an Amended Defence whereby it alleged that:

• Sirius had sold and delivered the ship to it pursuant to a tax invoice dated 15 February 2001 and Capital Finance had paid the full consideration for the sale to Sirius;

• in the alternative, Sirius knew that it had sold the ship to Mr Evans with a retention of title clause, that the tax invoice recording the sale to Capital Finance was false and that it had misrepresented the true facts to Capital Finance, whereby Sirius was estopped from denying the title of Capital Finance;

• in the alternative, the sale agreement between Sirius and Mr Evans had been fully performed by Mr Evans, there was no retention of title clause in that sale agreement and, even if there was, it was of no effect, so that the title in the ship had passed to Mr Evans and Sirius had no title to immediate possession. 19 By its Reply, Sirius joined issue on Capital Finance's Amended Defence. 20 By an Amended Cross Claim ("the First Cross Claim") Capital Finance claimed against Sirius and Mr Evans, and joined Hunt Pacific to the proceedings. As against Sirius, Capital Finance claimed:

• a declaration that it had title to the ship by reason of the sale evidenced by the tax invoice dated 15 February 2001;

• alternatively, that it had paid $600,000 to Sirius under a mistake and was entitled to repayment of that sum with interest.

As against Mr Evans, Capital Finance claimed the balance of monies due under the hire purchase agreement or damages for breach of that agreement.

• Capital Finance and Hunt Pacific had entered into an Introducer Agreement under which Hunt Pacific submitted proposals for finance to Capital Finance;

• under the Introducer Agreement, Hunt Pacific warranted that Capital Finance would acquire title to 'Sunrise' as soon as it paid the purchase price for the purpose of entering thereafter into the hire purchase agreement with Mr Evans;

• under the Introducer Agreement, Hunt Pacific indemnified Capital Finance against all loss and expense, including legal costs, arising from Hunt Pacific's warranty as to title being untrue;

• if it were found in the proceedings that Capital Finance had not acquired title to 'Sunrise', Hunt Pacific was liable to indemnify Capital Finance in respect of all loss. 21 By its Amended Defence to the First Cross Claim, Sirius joined issue. Mr Evans filed no Defence to the First Cross Claim.

By its Further Amended Defence to the First Cross Claim, Hunt Pacific:

• admitted that it had entered into the Introducer Agreement with Capital Finance;

• alleged that Capital Finance did in fact acquire absolute title to Sunrise, or that it had a better title than Sirius, whereby Capital Finance had suffered no loss for which Hunt Pacific was liable to indemnify it. 22 By its Cross Claim ("the Second Cross Claim"), Hunt Pacific claimed against Sirius and Mr Evans. As against Sirius, Hunt Pacific alleged:

• by the 15 February 2001 tax invoice, Sirius had represented to it that, upon payment of $600,000 by Capital Finance to Sirius, Capital Finance would obtain absolute title to the ship;

• if it were found that Capital Finance had not obtained absolute title to the ship, Sirius had engaged in misleading and deceptive conduct;

• Hunt Pacific had been induced by the conduct of Sirius to broker the hire purchase agreement between Mr Evans and Capital Finance;

• if Hunt Pacific were found liable to indemnify Capital Finance under the Introducer Agreement, Hunt Pacific would suffer loss as a result of the misleading or deceptive conduct of Sirius and was entitled to damages against Sirius.

As against Mr Evans, Hunt Pacific by the Second Cross Claim:

• made the same allegations as to misleading and deceptive conduct on the part of Mr Evans as it had made against Sirius;

• claimed damages in the event that it was found liable to indemnify Capital Finance. 23 By its Defence to the Second Cross Claim, Sirius joined issue. Mr Evans filed no Defence to the Second Cross Claim.

24 Young CJ in Eq heard the matter on 13, 14 and 15 March 2006, and delivered judgment on 10 May 2006: Sirius Shipping Corp v Ship Sunrise [2006] NSWSC 398 ("the May Judgment"). His Honour found:

• the sale of the ship by Sirius to Mr Evans had been completed on 26 February or by mid-March 2001, although the full purchase price had not been received by Sirius: [78];

• property in the ship passed to Mr Evans on completion: [79];

• as at 26 February 2001, subject to whether or not there was a retention of title clause in the sale agreement, Mr Evans had a better right to 'Sunrise' than Sirius: [95];

• the tax invoice of 15 February 2001 was not a genuine document and Capital Finance could not rely on it to assert title as against Mr Evans: [99]-[104];

• by reason of s.28(2) Sale of Goods Act 1923 (NSW) and the entry into the hire purchase agreement between Mr Evans and Capital Finance, Capital Finance had a better title to the ship than Mr Evans, who had a better title than Sirius: [107]-[113];

• the retention of title clause claimed by Sirius was contained in an agreement made between Sirius and Mr Evans in 2003, after title had already passed in February 2001, so that it was ineffective: [122]-[123];

• Capital Finance had the best title to Sunrise: [124]. 25 His Honour proceeded: "[125] In view of my findings and analysis, it is unnecessary to deal with questions of estoppel, subrogation, restitution or any liability of Hunt Pacific (sic) obliged to indemnify Capital Finance for not obtaining good title. In particular, I need not consider the extensive submissions as to whether there can be estoppels against Sirius in favour of Capital Finance when Sirius may well not have known of its existence. I am also absolved from examining closely the rather irregular way in which Capital Finance repossessed the ship.

[126] The claim by Sirius must be dismissed and a declaration made on the first cross claim in accordance with prayers (a) and (b) that Capital Finance is the owner of the Sunrise and for encumbrances to be removed. The second cross claim is dismissed as being otiose.

[127] As to costs, the plaintiff and the first interested party must jointly and severally pay the costs of Capital Finance.

[128] As to the second cross claim, I will reserve costs. It may be that there is some commercial arrangement between the parties which makes consideration of the question unnecessary. In any event, I have not heard the parties on the issue." 26 To recapitulate, the orders made by his Honour in paragraphs [126] and [127]:

• dismissed the whole of Sirius' Statement of Claim;

• did not expressly say who was to pay the costs of the Statement of Claim but impliedly ordered that Sirius and Mr Evans pay Capital Finance's costs of the Statement of Claim;

• granted relief on the First Cross Claim as claimed by Capital Finance against Sirius and Mr Evans on the issue of title to the ship;

• did not make any order as to Capital Finance's claim for damages against Mr Evans in the First Cross Claim for breach of the hire purchase agreement;

• did not make any order as to Capital Finance's claims in the First Cross Claim against Hunt Pacific;

• did not make any order as to costs payable to or by Hunt Pacific in the First Cross Claim;

• dismissed Hunt Pacific's Second Cross Claim on the ground that the issues therein did not arise;

• reserved all questions of costs of the Second Cross Claim. 27 Obviously, it was not appropriate to make any order in the May Judgment as to the damages claimed by Capital Finance against Mr Evans for breach of the hire purchase agreement. Capital Finance had not yet exercised its right to sell the ship (since title to the ship had until then been unresolved), so that it was not yet known whether the proceeds of sale would satisfy all liabilities of Mr Evans under the hire purchase agreement. The First Cross Claim as against Mr Evans would have to stand over until the ship was sold and it became clear whether Capital Finance had suffered any loss.

28 On 12 September 2006, Capital Finance filed a motion seeking, so far as is now relevant, the following orders:

• that leave be granted to Capital Finance to prosecute its First Cross Claim against Hunt Pacific founded on the Introducer Agreement, and that it be determined that Hunt Pacific pay Capital Finance's costs of repossessing the ship and its costs of the proceedings.

• to the extent necessary, that Capital Finance have leave to re-open its case to adduce further evidence. 29 On 6 October 2006, Young CJ in Eq heard argument on the motion and further submissions were later made in writing. His Honour published his reasons for judgment on 14 December 2006: [2006] NSWSC 1393 ("the December Judgment"). 30 In the December Judgment, his Honour noted the submission of Capital Finance that in the May Judgment he had not dealt with the issues between Capital Finance and Hunt Pacific referred to in the motion so that those issues were still alive in the proceedings and could be pursued. At [45] his Honour said that in the May Judgment he had taken the view that those issues arose only if he did not find that Capital Finance had good title to the ship. 31 With respect, the view which his Honour took seems correct. Paragraph 25 of the First Cross Claim pleaded that, if Capital Finance had not acquired absolute title to the ship and if the 15 February invoice was false, then Hunt Pacific's warranty of title in the Introducer Agreement was breached. Paragraph 26 pleaded that "in the circumstances" - i.e. the circumstances referred to in paragraph 25 - Hunt Pacific was liable to indemnify Capital Finance for loss and damage. The Particulars to paragraph 26, so far as are now relevant, included as heads of loss Capital Finance's costs of repossessing the ship and its costs of the proceedings. 32 It would seem to follow from the pleading of Capital Finance's cross claim against Hunt Pacific that if, as happened, the Court held that Capital Finance had acquired good title to the ship when it paid over its money, then Capital Finance's claim against Hunt Pacific for indemnity for repossession costs and legal costs under the terms of the Introducer Agreement must fail because Hunt Pacific's warranty of title had not been breached. The issue as to validity of the 15 February invoice was merely a sub-issue of the question as to where the title to the ship lay. 33 However, in the May Judgment, his Honour did not state expressly the reasons for concluding that it was unnecessary to deal with Capital Finance's claim for indemnity against Hunt Pacific. Neither did his Honour expressly deal with the cost consequences of his view that it was unnecessary to decide Capital Finance's claim against Hunt Pacific. 34 At [39] of the December Judgment, his Honour noted that the terms of the orders which he had made in paragraphs [126]-[127] of the May Judgment had been entered into the Court's computer on 11 May 2006. Consequently, in his Honour's view, by virtue of UCPR 36.11 those orders must be taken to have been entered on 11 May. His Honour also noted that no record in the Court's computer file was made as to the fate of the First Cross Claim save as to the relief claimed by Capital Finance against Sirius. His Honour concluded, therefore, that what was entered in the Court's record of orders was "a determination that no order should be made on the cross claim between (Capital Finance) and (Hunt Pacific)" : [46]. Accordingly, his Honour held that as final judgment had been entered on the First Cross Claim, the Court was functus officio and could not make any further order in respect of the First Cross Claim. Accordingly, his Honour dismissed Capital Finance's Notice of Motion with costs. 35 Hunt Pacific now applies for an order that Capital Finance pay its costs of the First Cross Claim. Hunt Pacific says that Capital Finance's claim against it has failed and that costs should follow the event. Alternatively, it says that the May Judgment has held that the cross claim against it was unnecessary, so that Hunt Pacific should have its costs of that cross claim. 36 Capital Finance submits that a Judge of first instance in this Court - whether the trial judge or any other judge - no longer has jurisdiction to make a costs order in relation to the First Cross Claim because that cross claim has been brought to finality by the May Judgment and the orders have been perfected. Capital Finance submits that the result of the orders made on that cross claim in the May Judgment is that, other than for the express relief granted as against Sirius, the cross claim has been implicitly dismissed with no order as to costs. It says that the implied order dismissing the balance of the First Cross Claim has been perfected, by operation of UCPR 36.11, by the entry of the express orders on 11 May 2006.

37 The policy of the law is that there should be finality in litigation. Accordingly, the general rule is that a Court has no power to set aside its own final judgment once it has been passed and entered: Bailey v Marinoff (1971) 125 CLR 529, at 530, 539; DJL v Cental Authority (2000) 201 CLR 226, at 245. Yet, powerful as is the policy of finality, it is subservient always to the fundamental requirements of justice that a litigant is to receive a fair hearing and is to have a determination by the Court of the case on its merits. If a proceeding in the Supreme Court is brought to conclusion without substantial compliance with these requirements, the Court by which the proceeding was heard and determined itself has jurisdiction - inherent and not deriving from the "slip rule" - to re-open the proceedings and to make substituted or additional orders; and this is so even when the previous orders have been perfected by entry. The principle applies both in civil and in criminal cases: see, for example, Bailey v Marinoff (supra) at 539-545 per Gibbs J; State Rail Authority of New South Wales v Codelfa Construction Pty Ltd (1982) 150 CLR 29, at 38-39; R v Bow Street Magistrate; Ex parte Pinochet Ugarte (No 2) [2000] 1 AC 119, at 132; DJL v Central Authority (supra) at [94]. 38 Many decisions illustrating this proposition in the context of the criminal law were examined by McClellan CJ at CL in R v Burrell [2007] NSWCCA 79. There, an appeal to the Court of Criminal Appeal had been heard and dismissed and the orders had been perfected by entry on the same day. The Crown subsequently applied to re-open the appeal upon the ground, not disputed by the respondent, that the Court had acted upon evidence which it mistakenly believed had been led at the trial. Of the authorities discussed by McClellan CJ at CL the most pertinent to the present case are those in which the appeal court had inadvertently omitted to deal with all grounds of appeal and subsequently gave leave to re-open the appeal after the Court's original orders had been perfected by entry: see e.g. Jones v R (1989) 166 CLR 409; Pantorno v R (1989) 166 CLR 466, at 484; R v Lapa (No 2) (1995) 80 A Crim R 398; R v Giri (No 2) [2001] NSWCCA 234, at [17] per Heydon JA. 39 The policy informing the jurisdiction of the Court to set aside or vary its own perfected order when justice so requires is given statutory recognition in UCPR 36.16(2), which provides for cases in which orders have been made in a party's absence. UCPR 36.16(3) provides additional power under the Rules of the Court to set aside or vary orders except where claims have been determined with finality. However, sub-rule (4) makes it clear that any limitation on the statutory power conferred on the Court by UCPR 36.16 does not inhibit the Court's inherent jurisdiction founded upon the requirements of justice. 40 A superior court of record, such as the Supreme Court, is never functus officio when its procedures have miscarried by denial of the fundamental requirements of justice. This is not to diminish the importance of adherence to procedure. Procedure is the cornerstone of justice: due observance of procedure guarantees, so far as is possible in any system of human devising, that decisions of the Courts are not made capriciously or with partiality or clandestinely so that they cannot be examined in the light of public scrutiny. By insisting on observance of established procedure the Court - which often must stand between the State and the citizen, between the powerful and the weak, the popular and the unpopular - insists on its independence in administering justice fairly, evenly and consistently according to law. 41 Yet the Court is not a slave to its own procedure. Procedure has largely been devised by Judges in decisions or rules made over the centuries and is now encapsulated in rules of Court. Circumstances sometimes arise when observance of the letter of procedure would offend against the very notions of justice which procedure is designed to protect: see e.g. Mulholland v Mitchell [1971] AC 666, at 679-680; D v Director General, Department of Community Services [2005] NSWCA 474, at [46]. For that reason, the superior courts have always insisted that the procedure which they administer is subject to a retained inherent jurisdiction in the Court to do justice. That inherent jurisdiction cannot be exercised in accordance with the idiosyncratic notions of justice held by any particular judge; the jurisdiction is exercised only to accommodate the anomalous circumstances of a particular case within already established and accepted principles of justice according to law. 42 The limits of the Court's inherent jurisdiction to depart from the policy of finality in litigation and to set aside its own perfected orders where justice so requires are probably best left undefined in exact terms, lest justice be thwarted in any particular case: see e.g. Meier v Meier [1948] P 89, at 95 per Evershed LJ; Bailey v Marinoff (supra) at 542, 544 per Gibbs J; DJL v Central Authority (supra) at [95] per Kirby J. However, the jurisdiction is always exercised with great caution and is never available where a claim has in fact been finally determined on the merits in accordance with the requirements of justice and what is sought is, in truth, a review of such decision by way of appeal: R v Bow Street Magistrate (supra) at 132; Postiglione v R (1997) 189 CLR 295, at 300; R v Burrell (supra) at [22].

Is the Court functus officio in the First Cross Claim

43 The authorities to which I have referred show that even if his Honour had made an order dismissing the whole of the First Cross Claim save for the relief granted against Sirius, Capital Finance could have asked his Honour to set aside that order on the grounds that Capital Finance's claim for damages against Mr Evans for breach of the hire purchase agreement had not been finally determined, there had been no order made as to Capital Finance's claims against Hunt Pacific, and there had been no order as to costs as between Capital Finance, Mr Evans and Hunt Pacific. His Honour would himself have had power, in exercise of the Court's inherent jurisdiction, to set aside any orders made which prevented those issues from being determined, even if the orders had been perfected. 44 However, in fact, no express order had been made in the May Judgment dismissing Capital Finance's claims against Mr Evans and Hunt Pacific. Those claims therefore remained alive in the proceedings and his Honour was not functus officio and without jurisdiction to deal with them. 45 The dismissal in the December Judgment of Capital Finance's motion of 12 September 2006 for leave to prosecute the First Cross Claim against Hunt Pacific cannot in itself be, or operate as, a final judgment or order on that Cross Claim. It is merely an order on an interlocutory motion. And, in any event, that motion was unnecessary: leave to prosecute the First Cross Claim against Hunt Pacific was not required as that claim had not been determined and was not the subject of any order in the May Judgment inhibiting its prosecution. The result which his Honour reached as to title to the ship may well have severely circumscribed any further debate as to the fate of Capital Finance's claim against Hunt Pacific, but it did not put an end to the possibility of any debate or to the right of Capital Finance to advance its contentions in that debate and have those contentions ruled upon. 46 In short, all that the dismissal of Capital Finance's motion did was to refuse Capital Finance permission to do something which Capital Finance did not need permission to do. As matters presently stand, therefore, Capital Finance could disregard the order made in the December Judgment dismissing its motion and simply require the Court to list the proceedings for the final determination of its cross claims against Hunt Pacific and Mr Evans. As a matter of law, Capital Finance would be entitled so to proceed. 47 However, as a matter of reality, of course, the Court Registry would probably refuse to re-list the First Cross Claim at Capital Finance's request in view of the dismissal of its motion of 12 September. If, in order to allow the First Cross Claim against Hunt Pacific and Mr Evans to be determined finally, it is necessary or expedient to set aside the order in December Judgment dismissing the motion, that order should now be made. It can be made in the exercise of the Court's inherent jurisdiction to do justice because setting aside the order would remove an artificial obstacle to Capital Finance's entitlement to have its First Cross Claim finally determined on its merits. It would also remove the artificial obstacle to Hunt Pacific's entitlement to have the issue as to its costs of the First Cross Claim finally determined by the Court. 48 However, as I am case managing this matter, the Registry will act in accordance with my directions so that a formal order setting aside the dismissal of Capital Finance's motion of 12 September will not be required in order to achieve re-listing. 49 For the reasons I have given, I conclude that the Court is not functus officio in the First Cross Claim, as Capital Finance contends: the Cross Claim is part-heard in that the claims therein against Mr Evans and Hunt Pacific have not been disposed of by final orders. Further, there is still on foot an application by Capital Finance to for leave to adduce further evidence in its cross claim against Hunt Pacific.

50 I have anxiously considered whether I should now proceed to make any orders relating to both the First and the Second Cross Claims. Capital Finance and Hunt Pacific have addressed argument to me as to what costs orders should be made; they have not submitted that only the Chief Judge now has jurisdiction to make such orders. I have been referred to cases in which it has been held that in certain circumstances costs orders in a proceeding may be made by a Judge who did not deliver the judgment giving rise to the application for costs: see e.g. Wentworth v Rogers (No 3) (1986) 6 NSWLR 642; Orr v Holmes (1948) 76 CLR 632. 51 If a Judge is unable, through death, illness or absence, to make an order which needs to be made so that a proceeding before the Court may be concluded, there is jurisdiction in the Court enabling another Judge to make that order: see Wentworth v Rogers (No 3) (supra) at 649, 653. The primary rule is, however, that once a Judge embarks upon the hearing of a case, he or she will determine all issues in the case. That primary rule does not prevent another Judge from dealing with some distinct ancillary and severable matter: see Wentworth v Rogers (No 3) (supra) and Orr v Holmes (supra). In accordance with this exception, it is now commonplace for distinct and severable issues such as the assessment of damages or the taking of accounts to be dealt with by someone other than the trial judge, such as where assessment is referred to an Associate Justice, or to a Referee whose report can be adopted by the Court pursuant to UCPR 20.14. 52 Apart from the exception relating to severable and distinct issues, it would be extraordinary for a part-heard case to be taken over by another Judge unless the first Judge is prevented from continuing. Normally in such a case, there must be a new trial before a second Judge. This is especially so if there are disputed factual issues. However, where the parties request such a course, the Court may accede to the request, although "there are in most cases grave objections to such a course" : Brennan v Brennan (1953) 89 CLR 129, at 136-137; Wentworth v Rogers (No 3) (supra) at 646D. The Court actively discountenances any attempt to procure another Judge to take over the conduct of a part-heard case except where the first Judge is, as a matter of practicality, unable to continue. It is easy to see that if the firm practice of the Court in this regard is relaxed, litigants who find the Judge hearing their case to be uncongenial for whatever reason may be unable to resist the temptation to procure some delay or derailment which will enable them to change Judges in mid-stream. This kind of Judge-shopping would completely undermine the efficient, orderly and transparent administration of justice. 53 In the present case, of course, there is no suggestion that the parties are attempting, for reasons of their own, to procure another Judge to continue hearing their case. The matter comes to me at the direction of the Chief Judge, for case management relating to the remaining issues and for determination of such of those issues as it may be appropriate for me to hear. 54 In the course of discussion with Counsel for the parties, Counsel have indicated to me that they wish me to hear all remaining issues in the case to finality. They are:

• Capital Finance's First Cross Claim against Mr Evans for damages for breach of the hire purchase agreement and the costs of such claim;

• Capital Finance's First Cross Claim against Hunt Pacific, including the issue whether leave should be granted to Capital Finance to re-open its case;

• a Third Cross Claim against Capital Finance filed by Mr Evans in which Mr Evans claims damages for Capital Finance's alleged breach of good faith in the manner in which it sold 'Sunrise' after re-taking possession;

• an application by Mr Evans to set aside the costs order made against him in the May Judgment pursuant to UCPR 36.16(2)(b) on the ground that the order was made in his absence;

• the costs of the Second Cross Claim by Hunt Pacific against Mr Evans and Sirius. 55 If the proceedings had not had such a lengthy and convoluted history, and if the parties had not already expended a great deal of time and money in bringing the matter to the present stage through case management directions from the beginning of this year, I would decline without hesitation their request that I conduct the trial of the matter to its conclusion for fear of creating a precedent for the relaxation of the primary rule that a Judge who embarks upon a trial should deal with all issues arising in that trial, save for severable and distinct issues. 56 However, in view of the considerations to which I have referred and which I regard as exceptional, if all parties to the proceedings expressly request that I deal with all of the remaining issues and claims to finality, rather than referring them back to the Chief Judge, I will do so if possible. If all parties do not consent, or if it emerges that issues of credit may arise which could result in my making findings contrary to those of the trial judge, I will continue to case manage the proceedings and when all issues are ready for hearing, I will refer the matter back to the Chief Judge.

57 But for one insuperable difficulty, I would have dealt now with the costs argument between Capital Finance and Hunt Pacific since those parties have requested me to deal with it. The difficulty is that Capital Finance's application for leave to adduce further evidence in its cross claim against Hunt Pacific has not been determined and, in the light of the conclusions to which I have come, still awaits determination. I do not know what the new evidence is and, of course, I cannot prejudge the question whether Capital Finance will be allowed to re-open. 58 In those circumstances, I cannot make costs orders on the First Cross Claim in respect of the claims made therein against Hunt Pacific because the result of those claims is not yet ascertained with finality. Argument between Capital Finance and Hunt Pacific as to the costs of the First Cross Claim will have to await final determination of all claims therein between them. 59 The Second Cross Claim has been expressly dismissed in the May Judgment and only the issue of costs has been reserved. The Second Cross Claim sought indemnity against Sirius and Mr Evans if Hunt Pacific were found liable to Capital Finance under the Introducer Agreement. However, Hunt Pacific's liability to Capital Finance under the Introducer Agreement still awaits determination under the First Cross Claim. It may be that Hunt Pacific will now wish to apply to set aside the order dismissing the Second Cross Claim, in the exercise of the Court's inherent jurisdiction. Hunt Pacific has not made any such application to date. I will not make such an order without affording the affected parties the opportunity to consider these reasons and to make such applications and submissions as they may be advised. However, I will not make any orders as to the costs of the Second Cross Claim until its status is unequivocally and finally determined.

60 In the result, I do not think that it is appropriate to make any orders at this stage. The parties will need to study carefully these reasons for judgment and their implications. They may then wish to make further applications and submissions as to what orders and directions, if any, should now be made. 61 Accordingly, all I will do is to publish these reasons and stand the matter over for further directions on a date to be fixed. I will then hear any application as to costs. - oOo -

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