Sydney Airport Corporation Limited v Baulderstone Hornibrook Engineering Pty Limited & Ors

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION TECHNOLOGY AND CONSTRUCTION LIST

Monday 2 June 2003 ex tempore Revised 16 June 2003

55027/02 SYDNEY AIRPORT CORPORATION LIMITED v BAULDERSTONE HORNIBROOK ENGINEERING PTY LIMITED & ORS JUDGMENT

1 Proceedings 55027 of 2002 commenced on 24 June 2002 with the filing of the initial summons. The proceedings concern the contract for the design and construction of the third parallel runway at Kingsford Smith Airport. The contract was entered into between the Federal Airports Corporation as principal and Baulderstone Hornibrook Engineering Pty Limited ["Baulderstone" or "BHE"], Dredeco Pty Limited ("Dredeco"), Dredging International N V and N V Baggerwerken Deciloedt & Zoon ("the joint venture parties") as contractor. 2 By declarations made pursuant to the Airports (Transitional) Act 1996 (Cth), the Sydney Airports Corporation Limited ("SACL"), the now plaintiff, became the successor to the Federal Airports Corporation. 3 The third parallel runway was apparently constructed on an artificial peninsular that projects into Botany Bay adjacent to and parallel with the original runways. The peninsular was apparently created from reclaimed sand dredged from neighbouring parts of Botany Bay. 4 To secure the sand and maintain the integrity of the peninsular, precast vertical concrete blocks ("facing panels") were apparently positioned around the circumference of the peninsular ("the seawall") continuing for a short distance on the northern aspect of the runway, creating a diversion of the millstream ("the millstream wall"). 5 The contract is said to have included as the Works: · the construction of approximately 6,800 metres of reinforced earth sea wall with precast concrete panels ("the seawall") around the perimeter of the parallel runway and along the eastern side of the existing 16/34 runway and across the area known as "the Hawke". · the construction of approximately 1700 metres of reinforced earth sea wall with precast concrete panels said to have been designed to act as a permanent diversion of the millstream. 6 The Works occurred from about August 1992. The practical completion of the Works was apparently certified in August 1994. 7 The plaintiff alleges that the reinforced earth block structure has failed in a number of respects, including migration of sand through facing panel joints, corrosion, inadequacy of structural elements and the like. 8 Deficiencies in the seawall are said to have become apparent in and after November 1994. Thereafter, extensive investigation in which the various parties participated, was apparently undertaken and the Baulderstone parties apparently obtained expert opinion as to the causes of the problems. The Parties. 9 The plaintiff joined the joint venture parties as the initial five defendants. 10 On a later occasion the sixth defendant was joined. The Amendments to the summons.

11 The summons was first amended on 9 September 2002. 12 It was later further amended on 15 November 2002. 13 The 9 September 2002 amendment followed a request by the Baulderstone parties for particulars of 16 September 2002, responded to by the furnishing of particulars on 28 October 2002. Following receipt of those particulars, the Baulderstone parties filed a defence to the amended summons on 22 October 2002. The only difference between the amended summons and the further amended summons was that the sixth defendant was joined to the proceedings by the latter document.

14 The proceedings have had a history of interlocutory motions dealing with a number of matters. 15 There are presently before the Court three motions which are conveniently described as follows: · Motion 3 - filed on 24 March 2003 by Connell Wagner, who are the first and second cross-defendants to the third cross-claim, seeking to dismiss or strike out the amended third cross-claim. · Motion 5 - filed on 21 May 2003 by the Baulderstone parties, seeking orders that the further amended summons be dismissed pursuant to Part 13 Rule 5 or, alternatively, be struck out pursuant to Part 15 Rule 26 or, alternatively, an order that the plaintiff file a second further amended summons or, alternatively, that the plaintiff provide further and better particulars. · Motion 6 - filed on 23 May 2003 by the plaintiff, seeking orders staying or dismissing motion 5.

16 As a matter of the appropriate case management of the hearing of these motions, the Court, following an inquiry of counsel and solicitors at the Bar table, determined to initially treat with motion 3 being a threshold motion requiring consideration for obvious reasons. The decision in relation to motion 3, or case management procedures which may follow a decision in relation to motion 3, may very well treat on a final or interim basis with motions 5 and 6. In that way, as it seems to me, the parties' legal representatives have acted entirely efficiently and pragmatically today.

17 It is unnecessary to repeat the record. As the further amended summons makes plain, the plaintiff relies, inter alia, upon the following causes of action: · breach of contract; · misleading and deceptive conduct said to breach section 52 of the Trade Practices Act 1974 and section 42 of the Fair Trading Act 1987; · negligence. The cross-claims. 18 A series of cross-claims have been filed. 19 In their second cross-claim against Reinforced Earth Pty Limited ("RE") the Baulderstone parties assert (paragraph 11) that RE supplied components including panels, reinforcing straps and jointing materials and carried out design of the reinforced earth retaining walls. 20 In their fourth cross-claim against GHD Pty Limited ("GHD"), the Baulderstone parties assert that GHD provided engineering and technical advice and carried out design reviews in connection with the third runway project. The third cross-claim. 21 The third cross-claim by the Baulderstone parties against the Connell Wagner parties is of present relevance. The Baulderstone parties asserted in the third cross-claim and assert in the amended third cross-claim that Connell Wagner NSW Pty Limited ("CW NSW") provided engineering services with respect to preparation of tender documents and the design and construction of the third runway and that Connell Wagner ("CW") provided certificates of compliance and was involved in and approved the work undertaken by CW NSW. The allegation by the Baulderstone parties is that they retained Connell Wagner to provide all engineering services (other than for dredging and reclamation works, geotechnical services and hydraulic model testing) for the contract, which included all detailed design and documentation, construction, stage services, progress reports and warranties. 22 It is important to note that with respect to each warranty relied upon by SACL in its claim against the Baulderstone parties, the Baulderstone parties rely upon an identical warranty in their claim against Connell Wagner with respect to all engineering services (defined as "Services to be performed by Connell Wagner") [hereinafter referred to as "the Connell Wagner Services"]. In other words, if the Baulderstone parties have any liability to SACL, which is denied, Connell Wagner, insofar as the Connell Wagner Services are concerned, is said to be liable to the Baulderstone parties for breach of an identical warranty.

The background to the bringing of the present motions. 23 The Baulderstone parties filed a motion on 19 August 2002 seeking orders that the summons be stayed or dismissed. That motion was ultimately not pressed when, by consent, directions were given on 30 December 2002 dismissing the motion. Ancillary directions made on the same day included provision of additional particulars by the plaintiff and the filing of defences and cross-claims by the defendants. The 19 August 2002 motion apparently did not result in any final disposition of the matter, so that it seems that no question of issue estoppel arises. 24 As I have said, the Court is currently engaged, as a matter of case managing these motions, with dealing with the Connell Wagner motion alone. Certainly, the other matters referred to in this judgment will therefore not be taken as any decision in relation to the other motions, but simply as adjectival information generally gleaned from the overview submissions of the parties, which, as one would expect and pursuant to the directions, treated with each issue on each of the motions. The stances taken on the hearing of these motions. 25 The Baulderstone parties adopt a bifarcated approach, primarily submitting that the particulars of breach provided by them to Connell Wagner and in turn those said to have been provided by SACL to the Baulderstone parties, are sufficient: · to enable Connell Wagner to plead a defence to the amended third cross-claim; · for the proper management of a complex engineering and construction place;

in circumstances where the real issues will be further defined by the filing of experts' reports in due course and the preparation of detailed Scott Schedules.

26 In the alternative, and if contrary to their primary submission, Baulderstone's particulars of breach are not considered adequate by the Court, then it is said to necessarily follow that the plaintiff's particulars of breach contained in the further amended summons are also deficient. In that event, the Baulderstone parties submit that the Court should order the plaintiff to file a further amended summons addressing the inadequacy of the particulars of breach and the balance of Connell Wagner's motion should be stood over until after the plaintiff has filed a second further amended summons. So much, in any event, comprised the Baulderstone parties' overview submissions furnished before the commencement of the hearing of the motions today. 27 Today, after the luncheon adjournment, Mr Gleeson of senior counsel, on behalf of the Baulderstone parties, submitted that an alternative approach to the Baulderstone parties' primary approach, would be for the Court to simply direct that the plaintiff, by a particular date, serve further particulars identifying each aspect of the drawings pleaded said to contain defective design and identifying why the drawings are defective in each respect and, further, direct the Baulderstone parties, by a later date, to serve further particulars against Connell Wagner identifying each aspect of the drawings pleaded which is said to contain defective design and identifying why the drawings are defective in each respect. The short minutes of order which he proffered along these lines would then provide for the Court otherwise to dismiss all motions and for costs of the motions to be costs in the cause. 28 The particular propositions for which the Baulderstone parties contend in relation to this exigency are as follows: · Taking this approach will avoid the injustice which will be occasioned to the Baulderstone parties if Connell Wagner is successful in its application to strike out the amended third cross-claim for want of adequate particulars of breach in circumstances where the Baulderstone parties have relied on the plaintiff's pleading as the basis for the "pass through" to Connell Wagner of any liability the Baulderstone parties may have to the plaintiff based on the plaintiff's particulars.

· In other words, the approach propounded by Baulderstone is said to ensure that Baulderstone would not suffer the injustice of having its pleadings struck out where in essence the dispute as to the pleading is said to lie between Connell Wagner and the plaintiff.

· SACL is said to argue that Baulderstone should not be given a further opportunity to attack its pleading for inadequate particulars of breaches. Baulderstone had previously filed a notice of motion, already referred to, returnable in late August 2002, in which a complaint was made about the summons then relied upon by SACL. As already mentioned, that notice of motion was compromised on the basis that SACL would file an amended summons and provide reasonable particulars of its claim. SACL now contends, so Baulderstone has submitted, that by reason of the compromise of Baulderstone's previous notice of motion, Baulderstone is shut out in some way from prosecuting its application to strike out the further amended summons for want of adequate particulars of breach. · Baulderstone submits that in the present circumstances the compromise of the previous notice of motion is not relevant and does not prevent it from agitating the present motion in a defensive manner in circumstances where it has been forced to adopt that position in the light of Connell Wagner's contentions that the particulars of breach are inadequate. · The circumstances in which a compromise of an interlocutory application of this character are said by it to operate as a barrier to a similar or related point being run, it is submitted, are narrow in scope. The submission is that if there is any such principle it would not extend to the present case, there having been a relevant change of circumstance. · The submission is that to find in favour of SACL motion would be productive of injustice and likely result in a multiplicity of proceedings in relation to the same issue. Baulderstone has sought to reserve its position to make further submissions on the legal adequacy of the particulars of breach relied upon by SACL, in the alternative to the approach propounded by Baulderstone, if the Court considered it necessary to look at those particulars in more detail at this stage of the proceedings.

29 As I have said, certain of those submissions were directed to a full hearing of all motions, whereas currently it is only the Connell Wagner motion with which the Court is concerned. The principles Successive Motions

30 The approach of the Court with regard to successive motions on the same or similar issues is illustrated by the decision of McLelland J in Brimaud v Honeysett Instant Print, [19 September 1988, unreported] [Reproduced in vol 2 Ritchie, Supreme Court Procedure, behind "Practice Decisions"]. 31 As a general rule, it does seem to me that a Court will not revisit an interlocutory order of a substantive nature after a contested hearing unless there has been a relevant change of circumstances in the intervening period. However, that is a discretionary matter and the Court must have regard, quite obviously, to the circumstances of the case.

32 The principles to be exercised by the Court in connection with an application to strike out pleadings are well established and articulated in General Steel Industries v Commissioner for Railways (NSW) (1964) 112 CLR 125. 33 The power to strike out pleadings because they disclose no reasonable cause of action should, I accept, only be exercised in plain and obvious cases. Barwick CJ in General Steel at 129-130 adopted the summary of authorities by Dixon J, as he then was, in Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at page 91.

"A case must be very clear indeed to justify the summary intervention of the Court to prevent a plaintiff submitting his case for determination in the appointed manner by the Court, with or without a jury. The fact that a transaction is intricate may not disentitle a Court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceedings amount to an abuse of process or are vexatious, but once it appears there is a real question to be determined, whether of fact or law, and that the rights of the parties depend upon it, then it is not competent for the Court to dismiss the action as frivolous and vexatious and an abuse of process." 34 Barwick CJ goes on to comment at 130:

"In my opinion great care must be exercised to ensure that, under the guise of achieving expeditious finality, a plaintiff is not properly deprived of his opportunity for the trial of his case by the appointed tribunal". 35 In particular, I accept that great care ought to be exercised in cases such as this involving allegations of breach of contract, negligence and misleading and deceptive conduct, where the outcome of the matter will be very much determined by the manner in which the evidence comes out." 36 As counsel for the Baulderstone parties submitted in their overview submissions, the observations of Gaudron, McHugh, Gummow and Hayne JJ in Agar v Hyde (2000) 201 CLR 552 at 557 are instructive:

"The result is that frequently the conventional form of pleading in an action of negligence will not reveal the alleged duty with sufficient clarity for a Court considering an application for summary termination of the proceedings to be sure that all possible nuances of the plaintiff's case are revealed by the pleadings. Further, and nevertheless importantly, any finding about a duty of care will often depend on the evidence which is given at trial. Questions of reliance or knowledge of risk are two obvious examples of the kinds of question in which evidence at trial may take a considerable importance in whether the defendant owed the plaintiff a duty of care." Considerations applicable in large and complex litigation. 37 It cannot be said that these proceedings are anything otherwise than large or complex. There have been at the bar table today, from time to time, eight counsel and solicitors. From time to time during interlocutory hearings, the plaintiff's side of the bar table have apparently indicated that in overview or general or bottom line terms, these proceedings concern a claim within the order of $80 to $100 million.

38 There being the parties to which I have referred and the cross-claims to which I have referred, quite obviously the Commercial List, which, subject to the overriding purpose rule, case manages these proceedings, must take particular care to ensure that the litigation moves along, albeit, where the interests of justice so dictate, interfering from time to time with particular interlocutory steps. 39 Whilst the issues presently for decision on the Connell Wagner motion are issues of delicacy and sensitivity, it is clearly the case that the whole of these proceedings constitute proceedings in a somewhat difficult area of specialised litigation. There is a tolerance which requires to be taken into consideration in balancing, as it seems to me, the obvious necessity that a defendant or cross-defendant know, with sufficient particularity, the nature of the case pressed against it, and, on the other hand, the proper case management of the proceedings underpinned by the overriding purpose rule. 40 Practical considerations often require the courts and the parties to take a commercial or pragmatic approach to technical matters such as pleadings. It may be thought that that attitude is reflected by Practice Note 100 and its emphasis on the 'just, quick and cheap disposal of the proceedings" and paragraph 25 of the Practice Note, which states that "as a general rule applications to strike out for summary judgments will not be entertained".

41 In litigation such as this it is submitted by the Baulderstone parties that an overly technical approach to the construction of pleadings is not warranted. They cite Penthouse Publications Ltd v McWilliam (unreported, New South Wales Court of Appeal, full court, 14 March 1991). Priestley JA, with whom Meagher JA and Waddell AJA agreed, there made the following observations after commenting that he had given a liberal construction to the statement of claim under attack in this matter:

"A further reason for adopting this approach is the familiar feature of litigation that in the case of any complexity there is frequent amendment of the pleadings between their first filing and the eventual judgment. In the course of trial, the knowledge of and evidence capable of proving facts available to opposing parties both changes and grows, no matter how diligent pre-pleading preparation has been. To order final dismissal or summary judgment on a strict construction of pleadings is to shut out the party suffering the judgment from the possibilities inevitably inherent in the post pleading phase of litigation. This should only be permitted when it is plain to the Court hearing the demurrer type application that on no reasonable view of the attacked pleading is there any point in allowing the case to go to trial."

42 I accept that the above observations are seen to be particularly apposite in relation to cross-claims. Commercial considerations clearly require parties in live litigation to issue cross-claims at the earliest possible time in order to avoid a multiplicity of actions. This will invariably be, I accept, prior to the optimum time, from an evidentiary perspective, to pursue such a cross-claim. In reality, as the Baulderstone parties have submitted in their overview submissions, the requirement to issue cross-claims as soon as possible has a certain element of fairness to cross-defendants in that they are afforded involvement in the principal litigation as opposed to being pursued after the main action has been heard or resolved. Particular considerations in building and construction matters. 43 In complex construction matters such as the present, much, I accept, will depend on the way that the plaintiff advances its case through its expert witnesses. Clearly that stage has not yet been reached. Clearly also, once that stage is reached, there is likely to be greater certainty in identifying the precise case the plaintiff brings against the defendants and in turn, presumably, the case which the Baulderstone parties bring against Connell Wagner. I accept further that the exchange of experts' reports does serve a useful purpose in distilling the issues between the parties. 44 I further accept as of substance the Baulderstone submission that it is common in construction cases for Scott Schedules to be ordered at a particular time whereby particular defects in construction and design are identified with precision and are responded to by defendants and cross-defendants. Here again, that stage has not been reached in this litigation. The essential submission by Connell Wagner. 45 The Connell Wagner submission is that the fundamental problem with the Baulderstone latest pleading is that it still fails to identify with precision the breaches of contractual, tortious or other duties said to be owed by CW NSW and CW at all, and/or as distinct from the other subcontractor/ cross-defendants. 46 Attempts are said to have been made on three occasions to elicit sufficient particulars of the allegations in the third cross-claim sufficient to identify the precise nature of such breaches and the manner in which it was alleged they had been committed; but the contention is that the particulars still fail to elucidate the issues. The submission is that the amendments incorporated into the new pleading do not overcome the problem. 47 The proposition is that whereas the object of particulars is to prevent the opposite party being taken by surprise at the trial of an action and to identify the issues of fact to be investigated at the hearing, it is simply not the function of particulars to take the place of necessary averments in the pleading of the material facts. [Saunders v Jones (1877) 7 Ch D 435 at 451; R v Associated Northern Collieries (1910) 11 CLR 738 at 740; Bruce v Odhams Press Limited [1936] 1 KB 697 at 712-3; McSpedden v Harnett (1942) 42 SR (NSW) 116 at 119; Kelly v Kelly (1950) 50 SR (NSW) 261 at 265; Turner v Dalgety & Co Ltd (1952) 69 WN (NSW) 228 at 229; Commercial Bank of Australia Ltd v Thomson (1964) 81 WN (Pt 1)(NSW) 553 at 557, 558; Ellis v Grant (1970) 91 WN (NSW) 920 at 924, 925; Emmerton v University of Sydney [1970] 2 NSWR 633 at 635; Bailey v Federal Commissioner of Taxation (1977) 136 CLR 214 at 219, 220, 221; Dare v Pulham (1982) 148 CLR 658 at 664] 48 Reliance is also placed on the proposition that "the plainness and most fundamental of all the rules of pleading" is that "all the material facts constituting the cause of action ought already to have been plainly stated in the pleading itself". [Pinson v Lloyds and National Provincial Foreign Bank Limited [1941] 2 KB 72 at 75; H 1976 Nominees Pty Limited v Galli (1979) 40 FLR 242 at 246-7] 49 The authorities, as the Connell Wagner submissions have pointed out, were helpfully collected by Fisher J in Trade Practices Commission v David Jones (Australia) Pty Limited (1985) 7 FCR 109 at 112-114. Dealing with the Connell Wagner Motion Pass through of liability. 50 Baulderstone's cross-claim against Connell Wagner is said by Baulderstone to be a "pass through" of liability. It is submitted by Baulderstone that it is brought on a contingent basis, having regard to the principal claim brought against Baulderstone by the plaintiff. 51 During the course of the hearing this morning, counsel for Connell Wagner, counsel for the Baulderstone parties and counsel for SACL traversed from time to time, doing so in great detail, the degree to which the further amended summons and the third cross-claim are or are not appropriately described as having "a relevant nexus", testing, insofar as the Baulderstone proposition put this, whether or not it was appropriate to describe the third cross-claim as a "pass through of liability". 52 As earlier made plain, this is simply not an occasion to repeat the record. Having said that, it seems to me that to a considerable extent there is substance in the submission that the gravamen of the third cross-claim comprises certainly a very serious attempt by the Baulderstone parties to pass across to Connell Wagner the liability to SACL, should it ultimately come to rest with the Baulderstone parties. Having said that, there has been very significant focus during the course of the hearing, particularly by Mr Pembroke QC, on the nature and extent and occasions when it is simply incorrect to thumbnail sketch the third cross-claim with which the Court is currently dealing, as "pass-on litigation" and no more. I do not propose to go into the particular allegations which SACL makes against the Baulderstone parties, comparing them to the particular allegations which the Baulderstone parties seek to make against Connell Wagner, otherwise than to indicate that there is substance in Mr Pembroke's submission. This is not to say that there is no overlap; quite clearly there is considerable overlap, but there are very important differences.

53 In my view the allegations of breach of the terms of the first Connell Wagner contract to be found in paragraphs 29.1, 29.2 and 29.3 are insufficient to enable the cross-defendant to know the nature of the case alleged against them. To my mind the particulars fail to remedy that deficiency. 54 The short position, it seems to me, is that the cross-defendants to the third cross-claim are entitled to know with sufficient specificity, in what manner and/or in what respect they failed to exercise all reasonable care, skill and diligence in providing engineering services to the cross-claimant; in what respects were the cross-defendants in relevant breach by failing to submit compliant designs and design drawings; what were the inadequacies in the designs and the design drawings; which were the tender specifications and requirements in respect of which the incorrect or inadequate designs and design drawings were prepared; and which were the respects in which the designs or design drawings provided by the cross-defendants did not comply with the tender specifications and requirements of the plaintiff. The particulars repeated in schedule 1 to the third amended cross-claim may be appropriately read as alleging that the relevant walls, in the manner in which they were designed pursuant to particular drawings, were designed so that they would not have the design lives as required by the nominate specifications. The problem with schedule 1, as it seems to me, is that it simply does not identify the deficiencies with sufficient precision to permit the cross-defendants to know the nature of the precise case which they are required to meet or to plead to. In short, insofar as the Connell Wagner Services are concerned, it is necessary, as it seems to me, for the allegations of breach to go the distance of identifying with sufficient precision what aspects of the design work of the cross-defendants are alleged to have constituted the relevant breaches. 55 However, insofar as the cross-defendants allege an insufficiency of pleading or of particulars in relation to the allegation of causation or loss, it does not seem to me that those submissions are of substance. 56 For precisely the same reasons, in my view paragraph 40 of the third cross-claim falls short of providing sufficiently precise particulars of the breaches of the second Connell Wagner contract sought to be pleaded in paragraphs 40.1, 40.3 and part of 40.4 [excluding the reference to a breach of warranties] and 40.7 [excluding the reference to a breach of warranty]. 57 Here again, it does not seem to me that the challenge to the particularity of the allegation of loss is of substance. 58 Dealing with the Trade Practices Act and related claims, paragraph 49 suffers, it seems to me, from the defect that the cross-defendants are not apprised of what was their conduct [qua the first CW representations] in or in relation to which the subject drawings and designs are alleged to have been misleading and deceptive. In what respects is it alleged that the subject designs and drawings were inadequate or inappropriate to achieve the designated purpose? 59 Likewise, as it seems to me, the pleading of the allegedly misleading or deceptive second, third and fourth CW representations, in each case again repeating paragraph 49, is defective. 60 Consistent with the reasoning which underpins the ruling going to paragraph 49, proper particulars require to be furnished of the matters alleged in paragraphs 50 and 51 of the third cross-claim. 61 Dealing with the negligence causes of action, part of the amended third cross-claim, for the very same reasons each count of negligence, as it seems to me, falls short in failing to identify with sufficient particularity the precise alleged breaches of duty of care. 62 Outside of these particular matters, none of the submissions pressed by Connell Wagner either by their written overview submissions or by their submissions from the bar table in terms of deficiencies, shortcomings or unfairness or embarrassment in terms of the pleaded case, or the pleaded and particularised case, appear to me to be of substance. The way forward. 63 Having given the matter careful consideration and cognisant of the strictures against the Court dismissing out of hand a pleading for lack of particulars, and cognisant also of the stage which these proceedings have presently reached, and, most particularly of all, cognisant of the many areas in respect of which the amended third cross-claim, notwithstanding the attack upon it, has survived that attack, it seems to me clear that the appropriate way forward in the interests of justice is as follows: · to require Connell Wagner to plead to so much of the third amended cross-claim as has survived the attack on the motion; · to defer for the time being any obligation upon Connell Wagner to plead to those sections of the third amended cross-claim as in my view, as expressed above, suffer from important defects in terms of pleading or particulars; · to identify a date and time by which the Baulderstone parties are to be granted leave to supplement the third amended cross-claim, either in the pleading section or by providing the particulars in the areas of deficiency as above described; · to require the plaintiff by a date and time to be identified, to either

• identify for the edification of the Baulderstone parties, by what communications from the plaintiff to the Baulderstone parties does the plaintiff assert that it has identified each aspect of the drawings relied upon by it in its pleading said to contain a defective design, and identifying why the drawings are defective in particular respects;

• if and to the extent that SACL, following a communication to the Baulderstone parties of these details, is said by the Baulderstone parties not to have already furnished those particulars, to again hear counsel on the further directions which, in that circumstance [and should the plaintiff be shown not to have served these particulars on the Baulderstone parties] will require the plaintiff to so furnish and provide those particulars. 64 Mr Pembroke addressed the Court in terms of the areas of disparity between the current form of the further amended summons filed on 15 November 2002 on the one hand and the approach and stances taken in it in terms of allegations and the current form of the amended third cross-claim in respect of the causes of action, stances and approaches taken in the allegations, on the other hand.

65 During the course of those submissions by Mr Pembroke, the Court raised with him the question of whether it could be seriously contended that the further amended summons did not plead, or effectively plead by reference, that drawings had been prepared containing defective design. To my mind, clearly paragraph C 25.1, when read together with the definition of "Project brief" (see page 97 of Exhibit B1), properly construed, amounts to just such an allegation of drawings containing defective design. Likewise to my mind, paragraph C 25.6 of the "Contentions" portion of the further amended summons amounts to the same essential allegation. For those reasons, and notwithstanding the differences to which Mr Pembroke pointed in his submissions, between the emphases in the further amended summons and those in the third amended cross-claim, it seems to me appropriate to require that SACL, as I have said, identify, if it can by some particular date and time, where it has communicated to the Baulderstone parties by way of particulars, the aspects of the drawings upon which SACL relies, which are said to contain defective design and also identifying why the drawings are defective in each respect. 66 The matters which then seem to me to remain for decision are, as a matter of case management of the proceedings, what precise directions as to the way forward should be given. Clearly, and for reasons which I have already sought to give, it is, it seems to me, entirely inappropriate on the Connell Wagner motion, to order any part of the third cross-claim to be currently struck out. 67 Doing the best that I can in the circumstances, it seems to me appropriate to permit the Baulderstone parties to replead and to furnish such particulars as may be thought appropriate, to those sections of the third cross-claim which it seems to me are defective. 68 There is not a great deal of difference between requiring the Connell Wagner parties to plead to such portions of the third amended cross-claim as have survived the attack and now striking out those portions of the Connell Wagner cross-claim as have not survived that attack. To my mind that being the case, there is no necessity for the Court to currently strike out those portions of the document. The Court can by case management procedures, simply direct that the Connell Wagner parties be not obliged to plead to those sections of the pleading shown to be defective in this judgment. In the fullness of time, it may be that leave will be granted to the Baulderstone parties to file a fourth amended cross-claim, and as between striking out sections of the cross-claim presently and not doing so, a decision either way will not play any role in my decision as to costs of and occasioned by or in relation to the motion. Plainly enough, Connell Wagner has succeeded to a certain extent in its motion. 69 In those circumstances, I seek the parties assistance in terms of some form of short minutes of order. I have endeavoured to achieve an accommodation of what I regard as real problems in the current version of the third cross-claim on the one hand, and on the other hand, a way forward which ought to permit all of the parties the benefit of having the Connell Wagner parties plead to so much of the third cross-claim as has survived. To my mind there is a real urgency in SACL producing a time and date for the communication by it to the Baulderstone parties of these particulars which will be soon, so that the matter can be again returned to the rails in terms of a conventional piece of litigation where pleadings require to be completed before one can usually achieve very much else. Costs 70 I propose to reserve costs up to the occasion when the whole of the motions can be finally treated with. One imagines that will be after the further particulars are furnished.

I certify that paragraphs 1 - 70 are a true copy of the reasons for judgment herein of the Hon. Justice Einstein given on 2 June 2003 ex tempore and revised on 16 June 2003

      Susan Piggott
      Associate

16 June 2003

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