Supreme Court of Queensland|2008-07-25|Before: Daubney J

WMJ Attractions Pty Ltd v. Ireland & Ors [2008] QSC 167 (25 July 2008)

HIS HONOUR: On the 30th of June 2008 I pronounced in open Court that there would be summary judgment for the defendants in this proceeding and published my reasons. As there was no appearance for the defendants at the delivery of the judgment I directed the parties to file submissions as to costs within 7 days. By agreement between the parties that period was extended. The defendants filed their submissions on costs on the 14th of July 2008.

On the 9th of July 2008, however, the plaintiff's solicitors had written to the Court and their opponents advising that they had now engaged the services of Mr O'Donnell QC, seeking the opportunity to make further submissions to the Court in respect of the matter and requesting that no order be taken out or perfected until the plaintiff had had that opportunity, stating "In particular the submissions will go to why our client should have the further opportunity to formulate a different pleading against the third defendant". The defendants' solicitors not surprisingly indicated their opposition to this course.

No order embodying the judgment pronounced by me on the 10th of June 2008 has been filed under Rule 661(1) of the Uniform Civil Procedure Rules.

The matter came on before me yesterday afternoon at which time Mr O'Donnell QC appeared for the plaintiff and submitted that, whilst he did not oppose the judgment being entered on behalf of the first and second defendants, the plaintiff sought that judgment not be entered in favour of the third defendant but rather that it be ordered that the further amended statement of claim filed 1 October 2007 be struck out and that the plaintiff have leave to file and serve a further amended statement of claim against the third defendant.

Mr O'Donnell has submitted a draft of the proposed further amended statement of claim (Exhibit 1). It would seek to plead two causes of action against the third defendant:

(a) a claim in contract for moneys alleged to be owed under the agreement dated 12th May 2005;

(b) a claim to avoid the contract for misrepresentation with a consequent claim for restitutionary relief which, so it would be pleaded, can be achieved by giving the third defendant credit for all amounts paid to the plaintiff under the agreement and the plaintiff claiming for what it says to be the value of the work performed on the project less the amounts paid under agreement, leaving a balance due to the plaintiff of some $167,000.

The first of these causes of action was conspicuously absent from the case previously pleaded on behalf of the plaintiff. The proposed pleading further properly articulates a claim for avoidance of the agreement, which the previous pleading had not, and sets out an intelligible claim for restitutionary relief.

There is abundant authority for the proposition that until an order made by a Judge has been perfected by being passed and entered (or, to use the terminology of Rule 661, "filed") the Court has an inherent jurisdiction to withdraw, alter, modify or vary the order. That inherent power is complemented by the specific provision of Rule 667(1) which provides:

(1) The court may vary or set aside an order before the earlier of the following -

(b) the end of 7 days after the making of the order.

I am aware of no case to suggest that the power to extend time conferred by Rule 7(1) cannot be used to extend the 7 day period referred to in Rule 667(1)(b) in appropriate circumstances and, to the extent necessary, I would grant an extension in this case.

It is also clear to me that the discretion extends to enabling a judge who has pronounced an order to reconsider the matter at any time before the order is perfected by being filed. (See for example Re Harrison's Share 1955 1 Ch 260 at 280 and the cases there cited.)

Accepting that I do have such a discretion and accepting, of course, that such a discretion must be exercised judicially and not capriciously, the question is whether I ought exercise it in the manner suggested by Mr O'Donnell in this case. Ultimately, that comes down to a question of doing justice between the parties.

Mr O'Donnell pointed to two matters in support of exercising the discretion in his client's favour. The first was that if judgment were entered in favour of the third defendant then, in any subsequent proceedings by the plaintiff against the third defendant, there would be a risk that the third defendant would have a complete defence to the causes of action advertised in the draft further pleading (Exhibit 1) on the basis of a res judicata in respect of the causes of action presently pleaded and an Anshun estoppel in respect of the cause of action which could have been, but was not, pleaded in this proceeding.

That risk was defused, however, by the proffering of an undertaking by the third defendant not to raise such estoppels by way of defence in proceedings of the type contemplated by the advertised further pleading (Exhibit 1) which the plaintiff might subsequently commence against the third defendant.

The second matter was that if the current proceeding against the third defendant is terminated by the entry of judgment, the $200,000 which is being held pursuant to the undertaking given in August 2006, when the plaintiff sought an injunction to restrain the sale of the complex, would be disbursed and that the plaintiff's claim in any future proceeding would be against a corporate shell.

It is regrettable in the extreme that circumstances have reached this pass. Mr O'Donnell acknowledged that this application was being brought at the eleventh hour. I think his watch is slow. The minute hand is hovering fractionally before the instant when the bell otherwise would have tolled for his client. But, to mix metaphors, the "fail-safe" point has not yet been reached. The purpose of the exercise of my discretion is to do justice between the parties, not effectively to punish one party for the conduct of those who previously represented it in this matter.

The undertaking proffered by the third defendant with respect to proposed future proceedings has the side effect of rendering further litigation between these parties effectively inevitable. In those circumstances, and provided that the proceeding is now conducted with accelerated expedition, I think that the justice of this case calls for me to accede reluctantly in these peculiar circumstances to Mr O'Donnell's request.

I would therefore vary the orders pronounced by me on the 30th of June 2008 to order that there be summary judgment in the proceeding for the first and second defendants against the plaintiff; to order that the further amended statement of claim be struck out and that the plaintiff have leave to file and serve a pleading in terms of the document entitled statement of claim No 4 which is Exhibit 1 against the third defendant.

In relation to costs, the plaintiff will pay the first and second defendants' costs of and incidental to the proceeding including the costs of the summary judgment application on the standard basis. Notwithstanding the submissions made in that regard on behalf of the defendants I do not consider the circumstances in this case to be so unusual as to warrant an order for indemnity costs.

Further, the plaintiff will pay the third defendant's costs of and incidental to the application for summary judgment, again on the standard basis for the same reason.

The plaintiff will, however, pay the third defendant's costs of the present application on the indemnity basis, this being such an unusual application brought in such unusual circumstances as to warrant the exercise of the extraordinary discretion to award indemnity costs.

WMJ Attractions Pty Ltd v. Ireland & Ors [2008] QSC 167 (25 July 2008)

At a glance

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Before

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Judgment (25 paragraphs)

WMJ Attractions Pty Ltd v. Ireland & Ors [2008] QSC 167 (25 July 2008)