Walter v National Australia Bank Limited [2001] VSC 143

Supreme Court of Victoria|2001-05-10|Before: Kellam J

PRACTICE COURT - appeal of Order of a Master permitting trial of the proceeding without pleadings - plaintiffs' claims against defendant including allegations of unconscionability, duress, estoppel and illegal appointment of receiver - appeal of Order of a Master upon pleading summons - appeal upheld - Supreme Court Rules Ch. I r.14.09.

The plaintiffs issued proceedings against the defendant by writ on 16 February 2001.

On 23 March 2001 Warren J made orders by consent that (inter alia) the plaintiffs' statement of claim be struck out with a right to file and serve an amended statement of claim.

Pursuant to the order of Warren J an amended statement of claim was filed by the plaintiffs on 20 April 2001.

On 24 April 2001 the defendant filed a summons seeking orders that parts of the amended statement of claim be struck out. That summons came on before a Master on 27 April 2000.

The Master made orders to strike out parts of the statement of claim. At the same time he ordered that the proceeding be tried without pleadings. In addition, he ordered that the proceeding be tried by judge alone without a jury.

On 1 May 2001 and pursuant to r.77.05 of the Rules, the defendant filed notice to appeal from the Master's order striking out some parts of the statement of claim but not other parts as sought to be struck out by the defendant, and further from the order of the Master that the proceeding be tried without pleadings. No appeal is brought against his order that the proceeding be tried by a judge alone without a jury.

Upon the appeal coming on for hearing before me on 9 May 2001 the defendant submitted that pleadings are essential in this case. It is submitted that although the dispensation of pleadings may avoid interlocutory challenges and thus enable the trial to come on for hearing more quickly, problems will be created for the trial judge in controlling evidence and in isolating issues for determination. It is further submitted by the defendant that there will be uncertainty as to the case the defendant has to meet and furthermore that problems may arise in the event of an appeal to the Court of Appeal if there have been no pleadings.

Rule 14.09 grants a wide discretion to the court in relation to pleadings and in particular provides that the court may order that a proceeding be tried without pleadings. Pleadings fulfil several functions. The first object of pleadings is to define with clarity and precision the issues or questions which are in dispute between the parties and which are to be decided by the court. Secondly, pleadings are intended to enable each party to give fair and proper notice of the case to be met by the other party. A third object of pleadings is to inform the court of the precise matters in issue between the parties. Fourthly, pleadings provide a permanent record of the issues and questions raised in the proceedings.

It follows that an order that a proceeding be tried without pleadings may be appropriate in circumstances where the above objects are capable of being achieved without pleadings. There may be occasions in litigation in this court where pleadings are unnecessary because the issues between the parties are easily identified and so clear that to require pleadings would impose an unnecessary cost burden upon the parties. A simple debt case or a common trespass case may be examples. There may be cases where the facts are not in dispute, or where resolution of the case depends upon the construction of a word or a phrase in an agreement. These cases would justify such an order.

The case before me, however, is not such a case. The relief sought by the plaintiffs is based upon unconscionability, duress and estoppel. The claim relates to a complicated set of financial dealings between a number of the plaintiffs and the defendant bank. It involves consideration of a number of securities including personal guarantees, company guarantees, debentures and mortgages. Allegations made by the plaintiffs include allegations that a receiver and manager was appointed without proper authority and that the actions of the receiver were thus illegal.

In my view and notwithstanding the sympathy I have for the difficulties faced by the unrepresented plaintiffs in formulating their claims, pleadings are necessary in the circumstances of this proceeding. They are necessary to ensure that the parties know the case they have to meet. They are particularly necessary to ensure that the resources of the court are not wasted in dealing with issues peripheral to the main differences between the parties. Accordingly, the appeal must be allowed in respect of the order of the Master that this proceeding be tried without pleadings and appropriate orders made in substitution therefore.

I turn now to the appeal brought by the defendant in relation to the order of the Master striking out part of the plaintiffs' statement of claim.. The Master ordered that paragraphs 13, 14, 15, 23, 25, 26 (both paragraphs), 28, 29, 30, 31 and 32, together with the sentence commencing, "The receiver ... " in sub-paragraph (g) of paragraph 20 of the statement of claim be struck out. Paragraphs 1, 2, 3, 5, 6, 7 and 8 of the plaintiffs' claim for relief were also struck out. The complaint of the defendant is that those orders are not wide enough and that other paragraphs of the statement of claim are embarrassing, improper, irrelevant or unsustainable and should be struck out.

Upon the hearing before me the defendant produced written submissions and relied upon an exhibit marked "DTN1" to the affidavit of Damien Thomas Neylon sworn on 24 April 2001. That exhibit was a copy of the amended statement of claim with the deletions sought by the defendant marked upon it. This proved to be an efficient and simple manner of dealing with the issues raised upon the appeal from the Master.

Furthermore, upon the hearing before me the plaintiffs for whom the third named plaintiff, Carmen Walter, appeared as a spokesperson, put submissions in writing before me. Those written submissions were headed "Outline of Defence". Regrettably, however, they did not deal with the issues raised by the summons of the defendant upon the appeal which was before me. Rather, the written submissions sought to rely upon (inter alia) Magna Carta, the Act of Settlement 1701, "major biblical events", issues related to Freemasonry and the Australian Constitution to argue that the trial of the proceeding should be by a "jury of 12".

As explained by me to Ms Walter in the course of the hearing, the issue of the nature of the trial of the proceeding has been decided by the order of the Master that the proceeding be tried by a judge without jury. That order was not the subject of any appeal and accordingly there is no issue before me as to that matter. However, the nature of the content of the "Outline of Defence" in my mind emphasises the necessity for pleadings to identify the real issues in the case in the interests both of the litigants and the resources of the court.

I turn now to the arguments of the defendant relating to the amended statement of claim:

(a) In addition to paragraphs 13, 23, 28, 29, 30 and 31 of the amended statement of claim which paragraphs have already been struck out by the Master, I am further satisfied that the allegations contained in paragraphs 18,19, 20(b)(d) and (e), and paragraph 24 are unsustainable, misconceived and do not give rise to any cause of action or relief.

(b) Paragraphs 12, 13 and 29 in addition to paragraphs 14, 25 and 26 (where it twice appears) make allegations of breach of criminal laws by the defendant. Such allegations are improper and immaterial in this proceeding.

(c) Paragraphs 1(iii), 2, 8(iii), 8(b), 10(iii), 16(c) and 22 contain wholly immaterial and irrelevant statements, conclusions and questions which should be struck out.

(d) Paragraphs 3, 8(iii), 8(c), 10(iii) and 12 seek to import into the pleadings contents of certain affidavits. This is an improper, immaterial and irrelevant method of pleading.

(e) Paragraphs 8(iv), 8(v)(c), 12, 16(d), 18, 23, 24 in addition to 20(g) which paragraph was struck out by the Master are unintelligible and embarrassing in that they appear to be directed towards a particular claim such as unconscionability, but contain a mere allegation without particulars, of another cause of action such as negligence, conspiracy or fraud.

(f) In addition to paragraph 32 which was struck out by the Master, paragraphs 8(iii), i(iv)(c), 10(iii), 15, 16(a), 16(b), 16(c), 16(d), 17, 18, 20(a) and 33 contain allegations which are unintelligible or embarrassing and to which the defendant cannot meaningfully plead.

(g) Paragraphs 6 (where it first appears), 12 and 24 seek, in a vexatious manner, to base an allegation or some unspecified cause of action on statements said to have been made by the defendant's counsel in the course of previous interlocutory hearings in this court and related to this proceeding.

It follows that the following orders should be made:

2. Paragraphs 1 and 2 of the orders of Master Evans made on 27 Apriil 2001 be set aside.

3. The amended statement of claim filed by the plaintiffs pursuant to the order made on 23 March 2001 by the Honourable Justice Warren be struck out in accordance with the deletions shown in Exhibit "DTN-1" to the affidavit of Damian Thomas Neylon sworn on 24 April 2001 (but not paragraph 4 of the "Relief and Remedy Sought" at p.24).

4. On or before 16 May 2001, the plaintiffs file and serve an amended statement of claim which omits the paragraphs and parts struck out under paragraph 3 of this order.

6. The plaintiffs pay the defendant's costs of the appeal.

7. Pursuant to the provisions of s.4 of the Appeal Costs Act 1998 I grant an indemnity certificate to the plaintiffs in respect of the costs of this appeal.

At a glance

Court

Decision date

Before

Source

Judgment (25 paragraphs)

Parties