Trampolines R Great P/L v Jalco Group Pty Ltd; Wincrow Pty Ltd v Jalco Group Pty Ltd

Catchwords: CIVIL PROCEDURE – pleadings – application to strike out pleadings – where proceedings were brought for negligence and nuisance – where it is claimed that the statement of claim is confusing and embarrassing and do not adequately plead cases pursued including for pure economic loss – motion dismissed

Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW)
Civil Procedure Act 2005 (NSW)
Civil Liability Act 2002 (NSW)

Cases Cited: Adelaide Stevedoring Co Ltd v Forst (1940) 64 CLR 538
Agar v Hyde (2000) 201 CLR 522
Bendix Mintex Pty Ltd v Barnes (1997) 42 NSWLR 307
Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520
FCT v Murray (1998) ATR 129
Garzo v Liverpool/Campbelltown Christian School Limited & Anor [2011] NSWSC 292
General Steel Industries Inc v Commissioner for Railways (NSW) & Ors [1964] HCA 69; (1964) 112 CLR 125
Mallonland Pty Ltd v Advanta Seeds Pty Ltd [2024] HCA 25
Menz v Wagga Wagga Show Society Inc [2020] NSWCA 65
Oshlack v Richmond River Council [1998] HCA 11
Roads and Traffic Authority of NSW v Refrigerated Roadways Pty Limited [2009] NSWCA 263
Stockwell v Victoria [2001] VSC 497
Tame v New South Wales (2002) 211 CLR 317
Trampolines R Great Pty Ltd v Jalco Group Pty Ltd [2024] NSWSC 1644
Tubemakers of Australia Ltd v Fernandez (1976) 50 ALJR 720
Waverley Council v Ferreira [2005] NSWCA 418 at [45]; [2005] Aust Torts Reports 81-818
Webster & Anor v Lampard [1993] HCA 57; (1993) 177 CLR 598

Category: Principal judgment

Parties: Proceedings No. 2023/309543
Trampolines R Great Pty Ltd (First Plaintiff)
FO Franchising Pty Ltd (Second Plaintiff)
Teznic Pty Ltd (Third Plaintiff)
Nick’s Happy Day’s Amusements (Syd Ops) Pty Ltd (Fourth Plaintiff)
Jalco Group Pty Ltd (First Defendant)
Jalco Automotive Pty Ltd (Second Defendant)
Jalco Australia Pty Ltd (Third Defendant)
Proceedings No. 2024/00149814
Wincrow Pty Ltd (Plaintiff)
Jalco Group Pty Ltd (First Defendant)
Jalco Automotive Pty Ltd (Second Defendant)
Jalco Australia Pty Ltd (Third Defendant)

Representation: Counsel:
L Edwards (Plaintiffs)
C O’Neill (Defendants)
Solicitors:
United Legal (Plaintiffs)
Carter Newell Lawyers (Defendants)

File Number(s): 2023/309543; 2024/00149814

Publication restriction: Nil

JUDGMENT

1. In March 2021 industrial premises at Prestons owned by Wincrow Pty Ltd were so substantially damaged in a fire, that they were condemned and later demolished. It had leased all four units located there to three of the other parties, the plaintiffs Trampolines R Great Pty Ltd and Teznic Pty Ltd and the defendant Jalco Australia Pty Ltd.

2. Two of the other parties, the plaintiff Nick’s Happy Days Amusements (Syd Ops) Pty Ltd and the defendant Jalco Automative Pty Ltd, also conducted their businesses at the premises under other arrangements. For its part the plaintiff FO Franchising Pty Ltd was entitled to share in the proceeds of Trampolines’ business under a franchise arrangement. The defendant Jalco Group Pty Ltd was the parent of the other two defendants, which all had the same directors.

3. Separate proceedings have been brought by Wincrow and by Trampolines, FO Franchising, Teznic and Nick’s Happy Days against all three defendants. But they all claim that all three defendants were responsible for the fire and the considerable damage it caused each of them. Claims in both negligence and nuisance are pursued. Wincrow also pursues a claim for breach of the lease.

4. In December 2024 Chen J ordered the defendants to file and serve a notice of motion and affidavit in support seeking to strike out all or some of the plaintiffs’ pleadings, by 3 February 2025 even though a defence had already been filed in March 2024: Trampolines R Great Pty Ltd v Jalco Group Pty Ltd [2024] NSWSC 1644 at [51]. His Honour also dealt there with the parties’ dispute about discovery, which has since been given.

5. This judgment deals with the strike out motions later pursued by the defendants.

6. They were pursued after their defences admitted certain facts; evidence, including expert evidence about the fire, having been served on the defendants; and they also having given discovery.

Conclusion

7. During the course of the hearing of the motion, some concessions were made, with the result that complaints about the claim in contract were withdrawn, but a further argument about a claim for pure economic loss not being available to be pursued, was also advanced.

8. For reasons which follow I am satisfied that the strike out orders which the defendants rather belatedly pursue cannot be made and that orders for the provision of particulars of claimed losses should be made.

Issues

9. There is no issue between the parties about the applicable law and principles which must be applied.

10. There is also no issue that Jalco Automotive stored combustible substances in the units Jalco Australia leased, where Jalco Automotive conducted its business. While the cause of the fire which destroyed the premises was not known, there is no issue that it had originated within one of those units, unit D. The plaintiffs plead that but for:

“a. Jalco Automotive (i) failing to exercise reasonable care in operating its business and causing or permitting the Combustible Materials to be stored within the Premises; and/or (ii) failing to remove or reduce the hazard that the Combustible Materials presented, and/or

b. Jalco Australia failing to exercise reasonable care in the use of the Premises, including in entering into the Premises Understanding and in permitting Jalco Automotive to operate its business from the Premises, then:

i. the Fire would not have been able to develop as it did destroying the Premises and penetrating Unit B: and

ii. the Hoxton Park Complex would not have been condemned and demolished.”

11. Whether this adequately pleaded the counterfactual which would arise to be considered in this case, was in issue. I consider that it does, that counterfactual turning as it does on the combustible materials not being stored inside the premises as they were.

12. It is also settled that being unable to show how a fire started is not necessarily fatal to proof of a case in negligence: Bendix Mintex Pty Ltd v Barnes (1997) 42 NSWLR 307 at [317] per Mason P, citing Adelaide Stevedoring Co Ltd v Forst (1940) 64 CLR 538 at 563-564, 56 and Tubemakers of Australia Ltd v Fernandez (1976) 50 ALJR 720.

13. Rule 14.7 of the Uniform Civil Procedure Rules 2005 (NSW) requires that pleadings must contain only a summary of the material facts on which the party relies and not the evidence by which those facts are to be proved. Rule 14.14(1) requires plaintiffs to plead specifically any matter that, if not pleaded specifically, may take the defendant by surprise. While rule 14.19 permits a pleading to raise any point of law, but it does not require them to be pleaded.

14. Rule 15.1 requires that particulars of any claim, as are necessary to enable the opposite party to identify the case that the pleading requires him or her to meet, be given in a pleading. They may be given in a separate document: r 15.9. The Court may also order particulars to be given, including as to claimed damages: r 15.10.

15. It follows that a failure to provide what a defendant considers to be necessary particulars, will not necessarily result in a strike out order. A defendant seeking particulars accords with the obligations imposed on parties by the Civil Procedure Act 2005 (NSW) in respect of the overriding purpose specified in s 56, the just, quick and cheap resolution of the real issues in the proceedings. Thus, an order for particulars usually follows a refusal to give them when sought.

16. But in this case the defendants have not sought any particulars, despite the criticism of the particulars given in the pleadings, especially in relation to the claimed losses, which were said to be confusing.

17. I do not consider them to be confusing. But they are pleaded only in general terms, with the result that the plaintiffs accept that if further particulars are sought, they will be provided.

18. Rule 14.28 permits pleadings to be struck out where it can be concluded that they disclose no reasonable cause of action or defence or other case appropriate to the nature of the pleading; or have a tendency to cause prejudice, embarrassment or delay in the proceedings; or are otherwise an abuse of the process of the Court.

19. The Court’s powers must be exercised having regard to the overriding purpose specified in s 56 of the Civil Procedure Act: s 58(2)(a). On a motion such as this it must act in accordance with what the dictates of justice require: s 58(1). It must also have regard to the matters specified in s 58(2)(b), to the extent it finds them relevant. In dealing with case management matters such as this, s 57(1) also requires that regard be had to:

“(a) the just determination of the proceedings,

(b) the efficient disposal of the business of the court,

(c) the efficient use of available judicial and administrative resources,

(d) the timely disposal of the proceedings, and all other proceedings in the court, at a cost affordable by the respective parties.”

20. In issue between the parties is whether the amended statement of claim adequately pleads the claims in negligence and nuisance. There finally being no complaint about the pleading of the breach of contract case.

21. The motion does not require any interim consideration being given to the merits of the claims the plaintiffs pursue. The strike out power is only available to be exercised in plain and obvious cases, including where the pleading is ambiguous or does not disclose a cause of action or one which can succeed. The parties’ cases must thus be considered in light of the principles discussed in General Steel Industries Inc v Commissioner for Railways (NSW) & Ors [1964] HCA 69; (1964) 112 CLR 125 at 129.

22. If there are real issues of law or fact to be decided, the strike out power should not be exercised: Webster & Anor v Lampard (1993) 177 CLR 598 at 602; [1993] HCA 57. Even apparently false or improbable allegations may not justify the exercise of the power, because that may require a preliminary and necessarily inconclusive investigation of facts on which a claim is advanced: Agar v Hyde (2000) 201 CLR 522 at 577.

23. The defendants accordingly accepted that if their case succeeded, the plaintiffs had to be given an opportunity to replead. That this was necessary was, however, disputed.

Does the statement of claim adequately plead the nuisance claims?

24. As I will explain, I am satisfied that the plaintiffs’ claims are adequately pleaded, raising as they do real issues of fact and law about the alleged negligence of each defendant and the losses which the plaintiffs pursue, albeit in general terms.

25. The amended statement of claim puts all defendants on notice of the case which will be pursued against them by each of the plaintiffs, given the undisputed storage of highly combustible materials inside unit D, before the fire, which began there, destroyed the premises.

The parties’ cases

26. The defence case was that the amended statement of claim is not pleaded in accordance with requirements of the Civil Liability Act 2002 (NSW): ss 5B and 5C. It was also claimed that the various parties having different legal relationships, why it is claimed that the defendants owed the various plaintiffs the claimed duty, had not been pleaded as it needed to be. Nor had the scope of the claimed duty, or the risk of harm which it is claimed each defendant ought to have foreseen been properly articulated.

27. All that had been provided being “reductionist references to general principles”, contrary to r 14.14 of the Uniform Civil Procedure Rules and applicable fundamental principles of pleading.

28. The amended statement of claim was also argued to be “confusing, poor in form and embarrassing”, with the result that none of the defendants can understand the case they will have to meet. That being because of the matrix of inter-party relationships and it being unclear as to what, if any, common law obligations each of these parties owed, to whom and by what relationship it arose.

29. Further, there were fundamental issues about the scope of the duty pursued, the individual risk of harm not having been pleaded. Nor was it pleaded that the purported breaches were a necessary condition of the alleged harm, or why the scope of any obligation owed to the plaintiffs extended to such harm, as s 5D of the Civil Liability Act required.

30. The result was that it was not possible to know what steps it is claimed each defendant ought realistically and reasonably to have taken to address the claimed risk of harm. It not being sufficient merely to plead, in broad terms, that it was foreseeable that there was a risk of fire which the defendants knew or ought to have known about. Why that was so also not having been pleaded, as it needed to be.

31. Further, it was not pleaded that the ignition of the fire was the fault of the defendants, or that anything which they did or failed to do was causative of loss, the pleadings being silent as to causation.

32. Reliance was also placed on Mallonland Pty Ltd v Advanta Seeds Pty Ltd [2024] HCA 25, where the principles which apply to claims for pure economic loss were recently considered: at [29]-[41]. It was submitted that the claims pursued by FO Franchising and Nick’s Happy Days appeared, impermissibly, to pursue pure economic losses.

33. Accordingly, it followed, the pleadings should be struck out.

34. The plaintiffs resisted the defence case, contending that they each pursued the pleaded common law duty to take reasonable care in the operation of the business conducted within the premises. All three defendants were members of the same corporate group, carrying on business together, with the result that they each owed the plaintiffs the claimed duty of care.

35. The scope of this duty included the obligation to take precautions against the foreseeable risk of a fire occurring within the premises and/or developing and spreading from the premises and causing damage and loss to those occupying the neighbouring units. That being consistent with the duty recognised in Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at 556-7 and that owed by an occupier to neighbours: Stockwell v Victoria [2001] VSC 497 at [401]-[402].

36. The defendants’ conduct, in breach of their duty, had resulted in the fire developing as it did because of their failure to take reasonable precautions. This was due to the defendants’ allowing the fire to escape the premises where it commenced, that causing the damage and loss which each plaintiff pursues, none of which involved purely economic loss.

37. The loss and damage which both Nick’s Happy Days and FO Franchising pursue was consequential to damage to their property. In the case of Nick’s Happy Days, this was the arcade modules it kept in Trampoline’s shop front and used in the course of conducting its business. And in the case of FO Franchising, this was the rights it had under the franchise agreement, not only to share in the profits of Trampoline’s business, but the goodwill it had in the Flip Out business which Trampoline’s conducted at the property, goodwill being long recognised to be property: FCT v Murray (1998) 39 ATR 129 at [24].

38. Even if this was not accepted, Nick’s Happy Days and FO Franchising should be given the opportunity to replead their claims.

39. The requirements of the Civil Liability Act had been pleaded in the necessary way, with the result that the pleadings were neither inadequate nor confusing. Thus, they could not be struck out, although it was accepted that if further particulars of the claimed losses were sought, they would be provided.

40. In reply it was accepted that whether a duty in negligence arises in a case of pure economic loss requires the salient features for and against the imposition of a duty to be evaluated. This requires the specific risk of harm to be pleaded and defendants not left to flush out or guess what is being alleged by a plaintiff and how a duty is said to arise. The result was that the statement of claim needed to be repleaded, to make the plaintiffs’ primary and alternative claims clear.

The amended statement of claim

41. The elements of a claim in negligence are well settled: Tame v New South Wales (2002) 211 CLR 317 at 88. These elements are a duty of care, breach of that duty, risk of harm and causation of loss.

42. Such claims must now be determined in accordance with the applicable requirements of the Civil Liability Act, on the evidence led. In this case, expert evidence about the fire has already been served.

43. The Civil Liability Act is not a complete code and does not deal with pleadings. But it does give statutory force to specified matters: Waverley Council v Ferreira [2005] NSWCA 418 at [45]; [2005] Aust Torts Reports 81-818 (68,074), discussed in Roads and Traffic Authority of NSW v Refrigerated Roadways Pty Limited [2009] NSWCA 263 at [174]-[177].

44. The defendants relied on Garzo v Liverpool/Campbelltown Christian School Limited & Anor [2011] NSWSC 292, where Garling J took the view that in a claim in negligence to which the Civil Liability Act applies, it is necessary that:

45. “the pleading identifies and articulates the material facts upon which the plaintiff relies to establish each of the elements required by s 5B(1)”: at [59];

46. “the plaintiff identify and articulate clearly the “risk of harm" in respect of which, it is alleged, the defendant was obliged to take precautions”: at [60];

47. “whether it is part of the plaintiff's case that the defendant had actual knowledge of the risk of harm, and that the risk was thereby foreseeable… or whether the plaintiff only contends that the defendant ought to have known of the risk of harm. Particulars of such a pleading would then ordinarily be provided”: at [61].

48. In this case the amended statement of claim pleads:

49. Who the parties are, their relationships, how they were each connected to the premises and what use all but FO Franchising made of parts of them: [1]-[14];

50. How fire safety at the premises was regulated and maintained: at [15]-[20];

51. The fire, how it spread and was extinguished after burning for some 10.5 hours: at [21]-[25];

52. The duty of care which it is claimed the second and third defendants owed to the plaintiffs: [26] to [28];

53. How the combustible materials came to be stored at the premises, with the resulting risk of fire about which those defendants knew or ought to have known: [26]-[32A];

54. How the second and third defendants failed to exercise reasonable care in the operation of their businesses and what precautions a reasonable person in their position would have taken: [33]-[35];

55. Causation, for which the second and third defendants are claimed to have been responsible: [36]-[37];

56. The loss and damage which the fire caused the plaintiffs: [38]-[41];

57. The duty of care which it is claimed the first defendant owed the plaintiffs and how it was breached: [41A]-[41F]; and

58. Causation, for which the first defendant was also claimed to be responsible and the resulting loss and damage it suffered: [41G]-[41J].

59. In their defence to the amended statement of claim the defendants deny that they owed the plaintiffs a duty of care, as alleged or at all; that they were negligent or a nuisance, as alleged or at all; and that the plaintiffs are entitled to the claimed relief. But they admit that:

60. Jalco Group held 100% of the shares in the other two defendants and they all had the same directors; and

61. The fire which began within unit D substantially destroyed the premises.

The pleaded claim in negligence is not deficient

47. I am satisfied that the facts which are pleaded do disclose the basis on which it is claimed that each defendant was negligent and responsible for the damage and loss which the plaintiffs claim the fire caused them.

48. The risk of harm which it is claimed arose from the storage of the combustible materials inside the premises is pleaded, as are the duties it is claimed the defendants each owed each of the plaintiffs in the circumstances in which the premises came to be destroyed by fire. How it is claimed they were breached by the three defendants and the losses it is claimed resulted, are also pleaded.

49. The obvious risk of harm which it is claimed the defendants each knew or ought to have known about is that in the event of a fire within the premises:

“a. the Combustible Materials could fuel that fire and therefore contribute to its intensity, magnitude and spread;

b. the nature and / or quantity of the Combustible Materials could create special problems for fighting the fire;

c. the spread of the fire from the Premises could damage any chattels situated within the neighbouring units, and therefore loss associated with that damage; and

d. the fire and I or the spread of the fire could cause disruption to the business conducted by the occupants of Unit A and Unit B and therefore cause loss to the plaintiffs associated with such disruption.”

50. That the claimed risk, so pleaded, is confusing, as the defendants contended, in my view cannot justly be accepted. Nor is this pleading contrary to the approach discussed in cases such as Menz v Wagga Wagga Show Society Inc [2020] NSWCA 65, on which the defendants relied, where no risk of harm had been pleaded: at [51]. It there being explained at [52] that “in Coles Supermarkets Australia Pty Ltd v Bridge at [22], it has been said that:

51. the formulation of risk of harm should identify the “true source of potential injury” (Roads and Traffic Authority of NSW v Dederer at [60]) and the “general causal mechanism of the injury sustained” (Perisher Blue Pty Ltd v Nair-Smith (2015) 90 NSWLR 1; [2015] NSWCA 90 at [98]);

52. “the risk must be defined taking into account the particular harm that materialised, and the circumstances in which that harm occurred”: Erickson v Bagley [2015] VSCA 220 at [33]; Southern Colour (Vic) Pty Ltd v Parr [2017] VSCA 310 at [55];

53. “What is to be avoided is an unduly narrow formulation of risk of harm which then distorts the reasoning, because, for example, it obscures the true source of potential injury (as noted in Dederer at [60]) or because it too narrowly focusses on the particular hazard which caused the injury (as noted in Port Macquarie Hastings Council v Mooney ... at [67]), or because it fails to capture part of the plaintiff’s case (as in Garzo).””

54. In my view the amended statement of claim satisfies such requirements.

55. Jalco Automotive is claimed to have had both a common law duty to take reasonable care in the operation of its business and as the occupier of the premises where the fire started and spread from, as well as a common law duty to remove or reduce hazards to its neighbours: [26]-[27].

56. Jalco Australia is claimed to have had a common law duty to take reasonable care in the use of the premises, including entering into the understanding with Jalco Automotive by which it occupied the premises and operated its business there: at [27A].

57. The scope of these claimed duties is also explained: at [27A].

58. Jalco Group is claimed to have controlled, supervised, managed and/or advised on the activities which the other defendants undertook in connection with the premises and thus to have also owed a common law duty of care to those who might be harmed by their activities: [41A]-[41B]. The scope of that claimed duty is also explained: at [41A].

59. It is also claimed that Jalco Group knew or ought to have known about the storage of the combustible materials within the premises and that additional measures required by the Building Code of Australia BCA 1996 within premises used to store such materials in the quantities Jalco Automotive stored, were not being taken: at [41C].

60. How it is claimed each defendant breached their duties is also pleaded. As is what a reasonable person in the defendants’ circumstances would have done to remove or reduce the likelihood of damage or injury: [41E]-[41F].

61. The precautions which a reasonable person would have taken are claimed to have included storing the combustible materials in the external flammable storage area; limiting the quantity stored to within the requirements of Safe Work Australia; storing them in accordance with the Australian Standard; not storing that quantity of materials when the premises contained only specified safety measures and not specified additional measures; devising, installing and nominating a risk identification system for fire hazards and an environment compatible with safe storage; devising, installing and maintaining a system for containing and limiting the spread of fire from within the premises; installing fire sprinklers in accordance with the specified Australian Building Code provisions; causing an annual fire safety statement to be provided to the Local Council and the Fire and Rescue NSW Commissioner; and maintaining a hazard chemical register recording the type and quantity of hazardous material stored.

62. Whether the pleaded facts can establish what is so pursued against each defendant does not now arise to be determined. Nor does the scope of the claimed duties or the other matters with which ss 5B, 5C and 5D of the Civil Liability Act are concerned. They will all have to be determined on the evidence led at trial.

63. But in my view, the basis of the case which will be advanced against each defendant in relation to what those provisions are concerned with, has been adequately exposed by the pleaded facts.

64. Section 5B provides general principles which must be applied at hearing, including when determining whether the risk in issue was foreseeable. That is one of which the person knew or ought to have known; was not insignificant; and which in the circumstances, a reasonable person would have taken precautions against: s 5B(1).

65. The factual basis on which the plaintiffs’ case about such matters will be advanced is exposed by the amended statement of claim. What it pleads about the nature and quantity of the combustible materials stored in the premises; how they were stored; how they ought to have been stored; the risks which it is claimed their storage posed to those nearby; and what each defendant knew or ought to have known, are all pleaded. Those claims will all have to be considered on the evidence, in light of what is put in issue by the defendants.

66. Such issues will have to be determined in accordance with the provisions of ss 5B(2), 5C and 5D. The former requiring the Court to consider specified matters in determining whether a reasonable person would have taken precautions against a risk of harm. The claimed required precautions have been pleaded.

67. Sections 5C and 5D provide further principles which will have to be considered in resolving any issue about those claimed precautions and whether the defendants caused the harm which the plaintiffs claim they suffered.

68. That these provisions require the plaintiffs to plead anything more than they have pleaded, does not follow. What is pleaded including as it does the risk of harm which the storage of the combustible materials inside the leased unit, rather than in a designated flammable storage area outside, posed given that:

69. Their storage in the premises did not accord with the terms of the lease, fire safety measures in place, the requirements of the applicable Australian Standard, the Building Code of Australia, the requirements of Safe Work Australia, the Liverpool Council and the Fire and Rescue NSW Commissioner;

70. Storage of those materials in the unit had thus posed a hazard to neighbours which materialised; and

71. That hazard could have been removed or reduced by the defendants having taken available, pleaded steps.

72. From what has been pleaded it is also apparent that as to factual causation, the plaintiffs each claim that the defendants were negligent, that having been a necessary condition of the harm they each suffered: s 5D(1)(a). Further, that it is appropriate for the scope of each defendant’s liability to extend to the harm they caused: s 5D(1)(b).

73. Factual causation will have to be determined in light of what the evidence establishes about the pleaded circumstances in the case of each defendant: s 5D(3). In the context of that evidence, the Court will also have to consider the scope of each defendant’s liability, particularly, whether or not and why responsibility should be imposed on each defendant, if it is found to have been negligent: s 5D(4).

74. The facts which will be relied on to advance the plaintiffs’ claims about such matters have also been pleaded. They are not required to plead the evidence on which they will rely to prove those facts.

75. In the case of FO Franchising, it is claimed that as the franchisor, it had an interest in Trampoline’s business and the revenue it generated, as well as in the goodwill of the business conducted at the destroyed premises, that having also been recognised to be property*: FCT v* Murray (1998) ATR 129 at [23]. The location from which a business is conducted being a source of goodwill: at [24]. It is claimed that the fire restricted the operation and conduct of Trampoline’s business, as well as damaging its goodwill, with resulting damage to FO Franchising as well as the other defendants.

76. It follows that it cannot be accepted, at this stage, that FO Franchising impermissibly pursues a claim for pure economic loss. Even if it does, whether the duty and negligence it pursues can still be established cannot be determined at this stage of the proceedings, that depending on the application of the principles discussed in Mallonland on the evidence led to establish the pleaded case.

77. In the case of Nick’s Happy Days, it not only had assets in the premises which were destroyed, it conducted part of its business there, under an arrangement with Trampolines. It thus cannot be accepted that its claim is one for purely economic loss.

78. As a result, I am satisfied that what has been pleaded is not confusing or embarrassing, as the defendants contended and may not justly be struck out.

The losses

73. But I do accept that further particulars of the claimed losses should be given, if pursued by the defendants, as the plaintiffs accepted. They should thus be given a final opportunity to seek them.

74. Given the time which has elapsed since the amended statement of claim was filed and served, the defendants have certainly had ample time to consider what further particulars they may require. But they have not sought any. Since then they have filed a defence, evidence has been served on them and they have given discovery.

75. It follows that if they still require further particulars of the claimed losses, then the defendants should now seek them promptly.

Has the claim in nuisance been adequately pleaded?

76. I am also satisfied that the claim in nuisance is adequately pleaded.

77. The nuisance claim is pursued against the second defendant, Jalco Automotive who, it is claimed, stored the combustible materials in the units it leased from Wincrow, with resulting undue interference in its use of its land. That flowing from the demolition of the buildings after the fire and its resulting inability to occupy, lease or otherwise make use of its land.

78. In the pleaded circumstances earlier explained, it is claimed that Jalco Automotive’s conduct constituted a nuisance, which had caused Wincrow damage and loss, for which it is entitled to compensation.

79. The defence case is that while negligence is not a necessary element in nuisance, it is generally required in a case where damage to property resulting from fire is pursued. But it was not alleged that Jalco Automotive had caused the fire, or that there were reasonable steps which could have been taken which would have prevented harm emanating from its conduct.

80. The plaintiffs contend that what must be established is an act or omission in circumstances where it was reasonably foreseeable that it might result in unreasonable interference with the enjoyment of an interest in land.

81. I am satisfied that the amended statement of claim adequately pleads what is pursued in nuisance, relying as that does on what is pleaded in respect of the claimed negligence.

82. This pleading includes Jalco Automotive’s acts and omissions, pleaded in the context of alleged knowledge that in the event of fire the combustible materials it had stored on the premises could fuel a fire and create special problems for fire fighting, which would result in the damage or destruction of other units, which could then not be occupied or leased and would have to be demolished. This was especially so given the nature and/or quantity of the combustible materials.

83. It follows that the nuisance claim can also not be justly struck out.

Cost

84. The usual costs order under the Rules is that costs follow the event: r 42. In this case that is an order that the defendants bear the plaintiffs’ costs of their unsuccessful motion.

85. The plaintiffs’ sought a departure from the usual order. There is no issue about the Court’s power to make such an order: s 98 Civil Procedure Act.

86. The plaintiffs’ case was that there was a real question about the motion ever having had any prospect of success and it being relevant that the defendants have unnecessarily protracted the proceedings, by the course they have pursued.

87. If what was relied on amounts to misconduct in the proceedings, a basis for the Court exercising its power to make an indemnity costs order against the defendants will be established: Oshlack v Richmond River Council [1998] HCA 11.

88. The defence case did not address costs, nor was that addressed at the hearing. In the circumstances the parties should confer about this and if there is any dispute about the appropriate costs order, they should each provide short written submissions within 14 days.

Orders

89. For these reasons I order that:

90. The motion be dismissed.

91. If the defendants require further particulars of the claimed losses, they should serve a request for particulars within 14 days, which the plaintiffs should reply to within a further 21 days.

92. In the event of any dispute about the appropriate costs order, the defendants should file and serve the order they propose within 14 days, together with short written submissions and the plaintiffs should file and serve their reply submissions within a further 7 days. Otherwise, the court will order that the defendants bear the plaintiffs’ costs of the motion as agreed or assessed.

93. The matter adjourns to 30 May 2025 before Chen J for further directions.

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