Wintle v Stevedoring Industry Finance Committee and Ors

Supreme Court of Victoria|2002-09-03|Before: Ashley J

Practice and procedure - application for consent orders by some of the parties to a proceeding - power in the Court not to make or to delay making the orders sought - circumstances in which the Court may so act - application for orders presently refused.

As I noted in my Reasons on an earlier application[1] the plaintiff and the first defendant compromised the issues between them in October 2002. Terms of Settlement were signed. I should set out certain parts of them:

"1. SIFC pay the Plaintiff in her capacity pursuant to Part 3 of the Wrongs Act 1958 (vic) and in her capacity pursuant to the Administration & Probate Act 1958 (Vic) the sum of $400,000.00 inclusive of all costs between SIFC and the Plaintiff, whether such costs be reserved or otherwise determined in favour of either party. .... 4. In the 2000 proceedings there be orders by consent that: (a) the Plaintiff's claim as against the first defendant is barred by operation of section 20 of the Wrongs Act 1958 (Vic); (b) there be judgment for the first defendant; .... 9. The parties will use their best endeavours to secure orders from the court in the terms of paragraphs 3 and 4 herein. If the court refuses to make any or all of the said orders or any of the said orders are set aside then it will be a fundamental term of the parties agreement that: (b) the Plaintiff will apply and take all steps necessary to discontinue the 2000 proceedings against SIFC and will not take any further step against SIFC in the prosecution of the 2000 proceedings or the claims which are the subject of the 2000 proceedings;"

It is to be noted that payment was to be made to Mrs Wintle in her capacity both as a plaintiff for the purposes of Part 3 of the Wrongs Act 1958 and in her capacity as executrix for the purposes of s. 29 of the Administration & Probate Act 1958. It is further to be noted that the amount payable, $4000,000.00, was evidently far in excess of the amount that the plaintiff could have recovered under s. 29. It necessarily included a very substantial Wrongs Act component.

On 29 August 2002, pursuant to a summons filed on 25 July, counsel for SIFC and the plaintiff sought orders in the terms of paragraphs 4(a) and (b) of the Terms of Settlement. That application was opposed by counsel for CSR and Hardie.

s Contribution proceedings by SIFC against Hardie and CSR;

s Contribution proceedings by Hardie and CSR against SIFC.

I was asked to assume, for the purposes of the present application, that CSR's claim for contribution against SIFC was not doomed to failure by operation of s. 23B(3) of the Wrongs Act.[2] Mr Kaye of Queens Counsel for CSR submitted that it would have been convenient to have had argument on the hearing of the application whether that assumption was correct; for if CSR's contribution claim was hopeless there would be no basis upon which CSR could resist the application for consent judgment. But Mr Gorton of Queens Counsel for SIFC did not take up the challenge. Hence the assumption to which I referred a moment ago.

That assumption apart, I should mention two concessions made by SIFC for the purposes of this application:

s One of the purposes of the Terms of Settlement was to take advantage of any impact they might have on existing or potential contribution proceedings; and

s The settlement sum of $400,000.00 has been paid to the plaintiff; and whether or not judgment is entered by consent will have no effect on the operation of the Terms.[3]

Mr Gorton submitted that it was appropriate that orders sought be made. There was, he argued, a clear factual foundation for judgment in accordance with paragraph 4(a) of the terms. Mr Wintle had brought a claim against SIFC in his lifetime. The present procedure had been commenced outside the ordinary limitation period, and s. 20(2)(b) of the Wrongs Act would preclude a successful application to extend time.

Mr Gorton, in asserting the propriety of orders being made in accordance with the terms, referred also to s. 23B(5) of the Wrongs Act. He argued that "judgment" where there appearing should be understood to include a consent judgment. The effect of the subsection, he said, would be to conclusively determine for the purposes of contribution proceedings - in accordance with the true factual situation - that SIFC had an unanswerable limitation defence to the plaintiff's action.

Mr Kaye did not contend that at no time should SIFC and the plaintiff have the orders which they sought. But he submitted that for a number of reasons the orders should not be made at present. I summarise them this way:

First, to make such orders would or might preclude the litigation of proceedings which were alive between his client and SIFC; and as well between Hardie and SIFC. He did not concede that James Hardie & Co Pty Ltd v Seltsam[4] would inevitably prevent his client successfully pursuing contribution proceedings against SIFC if the proposed orders were made; but there was a prospect that it would do so. It would be wrong in principle, he submitted, for the court to enter a consent judgment which would or might have the effect of stifling the litigation of aspects of a proceeding presently before the court.

Second , the orders sought by SIFC evidenced a tactical ploy by that defendant designed to defeat the litigation of contribution proceedings brought by the other parties. SIFC was seeking not only judgment in its favour against the plaintiff, in circumstances where it had agreed to pay her a large amount of money, but also an order that the plaintiff's claim against it under Part 3 of the Wrongs Act was barred by s. 20 of that Act. Not content with reliance on James Hardie v Seltsam it was seeking to set up another defence to contribution proceedings in reliance upon an order in the form of paragraph 4(a) of the Terms of Settlement and s. 23B(5) of the Wrongs Act.

Third, it was wrong to say that the proposed orders reflected the reality of the situation as between the plaintiff and SIFC. SIFC was on the one hand asking the court to say that it had an unanswerable limitation defence to Mrs Wintle's Wrongs Act claim; whilst on the other hand it had evidently paid her a large amount in respect of such a claim. In any event, s. 23B(5) of the Wrongs Act was intended to address only substantive determinations by a court[5], in which case the second layer defence intendedly set up by an order corresponding with paragraph 4(a) of the Terms of Settlement would not achieve its purpose.

Fourth, apart from the circumstance that if the proposed orders were not presently made SIFC would be deprived of an advantage sought by its tactical ploy, it would suffer no detriment. Its compromise with the plaintiff would stand. Other than that, it would be a party to extant contribution proceedings which would be proved to be good or bad as the case might be. Neither would the plaintiff be disadvantaged were the orders not made. She had been paid and would retain the amount paid to her. It was CSR (and Hardie) which faced detriment if the Court proceeded to now make the orders sought.

Mr Batt of counsel for Hardie supported Mr Kaye's submissions. He argued, inter alia, that there was no basis for SIFC having judgment entered in its favour in circumstances where it had paid a substantial amount to the plaintiff. The orders sought were a device. They were at odds with the orders commonly sought where a plaintiff and defendant settle. Further, the order sought in accordance with paragraph 4(a) of the Terms of Settlement was inappropriate, there having been no adjudication as to the operation of s. 20 of the Wrongs Act as between the plaintiff and SIFC. The Court in exercising power to make a consent order was not obliged to do simply what the parties asked.

In my opinion the orders sought by the SIFC and the plaintiff should certainly not be made at the present time. The following considerations are pertinent: first, it was not in contest that counsel for CSR and Hardie had a right to be heard on the application. Indeed they did. Within the overall proceeding, proceedings are extant between each of them and SIFC. The orders sought by SIFC, consequential upon a private agreement reached between that defendant and the plaintiff, would or might preclude CSR and Hardie from pursuing those proceedings. If it was not otherwise apparent from those circumstances that CSR and Hardie had a right to be heard on the application, observations in James Hardie v Seltsam by implication make the matter very clear[6].

Second, the ordinary inference to be drawn from the circumstance that a party has a right to be heard in opposition to an application for orders by consent (including the giving of judgment) is that in such a case the court is not bound simply to rubber stamp the consent. That conclusion may be reached by other routes. So, the giving of judgment or the making of orders is a judicial act. It is not the less so because the judgment given or orders made are by consent of all or some of the parties to a proceeding. Again, the conclusion is implicit in the passages in James Hardie v Seltsam to which I referred a moment ago. There it was said that by not opposing the application for consent orders the appellant had (or at least, might have) denied itself the opportunity to appeal against the making of such orders.

Third, the Court should be jealous to protect its processes. No doubt it encourages parties to litigation to settle their differences. But it is not the necessary corollary of such encouragement that the Court should accede to an application for consent orders made in consequence of compromise arrived at by some parties to a proceeding where the effect of the orders will or may be to stifle the hearing and determination of other aspects of the proceeding which involve one of the parties to the proposed consent orders.

Fourth, even in a case where all the parties to a proceeding agree upon consent orders, the Court retains to itself a right not to make the orders sought[7]. The position must be the stronger where not all the parties agree to the proposed order.[8]

Fifth, whilst it certainly appears to be a good enough reason not to make consent orders that to do so would or might frustrate the hearing and determination of aspects of a proceeding involving a party to the consent orders, the position must be the stronger where a purpose of orders being sought at all, a fortiori in a particular form, is to frustrate such hearing and determination. In the present case, had the pertinent concession not been made, it would have been crystal clear in any event that such a purpose was present. If pressed, I should have concluded that it was the dominant purpose. I need not go so far as to describe the proposed orders as an abuse of process.

Sixth, in a particular case, if the Court is doubtful whether proposed orders reflect the true state of facts, that circumstance may be an additional reason why the orders sought should not be made[9]. I could not say, in the absence of full argument, that the order sought in accordance with paragraph 4(a) of the Terms of Settlement, its obvious purpose being later reliance on s. 23B(5) of the Wrongs Act, inevitably reflects the outcome of the factual circumstances applied to s. 20(1)(2) of the Wrongs Act.

Seventh, the case is not one in which to presently decline to make the orders sought will prejudice either of the parties to the compromise save that SIFC will lose the advantage of its stratagem. On the other hand, to make the orders sought would or might gravely disadvantage CSR and Hardie by precluding them from successfully seeking contribution against SIFC. To those observations I add this: by not making the orders SIFC, CSR and Hardie will be left free to pursue their respective contribution proceedings. But if the orders were made, it is possible that SIFC would obtain a singular advantage: retain its ability to successfully pursue contribution from CSR and Hardie, whilst those other defendants would or might be precluded from successfully pursuing their contribution proceedings against it.[10]

Eighth, Mr Gorton made the point that CSR and Hardie on the one hand submitted that consent orders should not be made; yet on the other hand contended that if the orders were made there would be answers to the James Hardie v Seltsam and s. 23B(5) problems. He made the point also that the statutory language considered by the High Court in James Hardie v Seltsam was different to that applying in Victoria; and that counsel for CSR and Hardie had argued nothing to show that the decision would apply in the Victorian context. In the result, he submitted, no reason had been shown why the orders should not be made.

The two points made by Mr Gorton were correct. But it does not follow that no reason was shown why the proposed orders should not be made. It is crystal clear, if the orders were made, that SIFC would rely upon James Hardie v Seltsam and upon s. 23B(5) with respect to the further prosecution by CSR and Hardie of their claims for contribution. It cannot be said, in the absence of full argument, whether such reliance would prevail. It certainly cannot be said that it would not prevail. It seems to me to require too much of CSR and Hardie that the Court be satisfied, before presently declining to make the proposed orders, that they would certainly erect a barrier to the successful pursuit of contribution claims made by those parties. That is why, at various points in these Reasons, I have said that if the orders were made they would or might erect such a barrier; and have used other language of like import.

I refuse, presently, to make the orders sought. It does not necessarily follow, however, that at some future time the Court would not make those orders. Subject to anything that counsel may wish to submit, I think that the proper course, in the circumstances, is to adjourn the further hearing of the first defendant's summons sine die.

[1] [2002] VSC 294 paragraphs 8 - 10.

[2] See paragraph 12 of my Reasons in [2002] VSC 294.

[3] The plaintiff, as I apprehend it, would be bound to apply and take necessary steps to discontinue against SIFC if the Court altogether refused to give judgment.

[5] Counsel referred briefly to various extrinsic materials.

[6] [1998] HCA 78; 196 CLR 53 at paras 17 - 20 per Gaudron and Gummow JJ and at para 133 per Callinan J.

[8] As to the overriding power of a court to control its own proceedings, being not obliged to act upon the request of some of the parties that consent orders be made see James Hardie v Seltsam, ibid at para 17 per Gaudron and Gummow JJ, and see also, as to principle, the dissenting judgment of Kirby J at para. 87. R.D. Werner & Co Inc v Bailey Aluminium Products Pty Ltd (1988) 18 FCR 389 cited by Gaudron and Gummow JJ, was a different type of case, involving relief from a breach of interlocutory orders made by consent.

[9] See, by analogy, Damberg v Damberg [2001] NSWCA 87; (2001) 52 NSWLR 492 at 522.

[10] See s. 23B(1)(2) and (4) but note s. 24(2B) of the Wrongs Act.

Probate Act 1958(Vic)

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