AJ Lucas Operations Proprietary Limited v CPW Trailer Sales and Repairs Proprietary Limited
[2013] NSWSC 2053
•19 September 2013
Supreme Court
New South Wales
Medium Neutral Citation: AJ Lucas Operations Proprietary Limited v CPW Trailer Sales and Repairs Proprietary Limited [2013] NSWSC 2053 Hearing dates: 19 September 2013 Decision date: 19 September 2013 Before: Rothman J Decision: 1. An order pursuant to r 23.8 of the Uniform Civil Procedure Rules 2005 that the representatives as set out in paragraph 3 enter into the premises at 24 Quinns Hill Road East, Staplyton and to carry out a detailed visual inspection of the 6 5/8 horizontal directional drilling pipes (Pipes) the subject of these proceedings;
2. The inspection detailed in paragraph 1 to be carried out in accordance with the provisions of clause 3;
3.
a) Within 7 days, the respondents' solicitors to provide a date and time on which the inspection of the Pipes can take place, such inspection to take place no later than 18 October 2013.
b) The inspection of the pipes is to take place at the address referred to in paragraph 1, where they are currently located.
c) For the respondents, the following persons will attend the inspection: Mr Stephen Coe; Mr Stephen Buchanan, solicitor for the respondents; and Mr A James of counsel.
d) For the applicant, the following persons to attend the inspection: Mr Graham Maher, solicitor for the applicant; Mr Paul Shields, employee of the applicant; Mr M Luitingh of counsel; and any other person that may identify the Pipes or give evidence about their value subject to the reasonable consent of the respondents.
4. Pursuant to the inspection, the applicant to provide a report as to its findings and any evidence that it intends to rely upon within 14 days of the inspection;
5. The representative for the applicant and the applicant's legal advisors be permitted to take photographs of the pipes during the inspection;
6. The costs of the notice of motion to be costs in the cause.
Legislation Cited: Commonwealth of Australia Constitution Act 1900 (Imp)
Civil Procedure Act 2005
Supreme Court Act 1970
Uniform Civil Procedure Rules 2005
Judiciary Act 1904Category: Interlocutory applications Parties: A J Lucas Operations Pty Ltd (Plaintiff/Applicant)
C.P.W. Trailer Sales and Repairs Pty Ltd (First Defendant/Respondent/First Cross-Claimant)
Coe Drilling Pty Ltd (Second Defendant/ Respondent/Second Cross-Claimant)
Stephen James Edward Coe (Third Defendant/ Respondent/Third Cross-Claimant))
Global Drilling Services Pty Ltd (First Cross-Defendant)
Stephen Loneragan (Second Cross-Defendant)Representation: Counsel:
M. Luitingh (Applicant/Plaintiff)
A. James (First, Second and Third Respondent/Defendant)
M. Wiggins (First and Second Cross-Defendant)
Solicitors:
File Number(s): 2011/142924 Publication restriction: None
EX TEMPORE Judgment
HIS HONOUR: The Court has before it a motion, notice of which was filed by the plaintiff seeking an order for the visual inspection of pipes, which are the subject of the substantive proceedings.
The substantive proceedings are proceedings between competitors in the horizontal drilling industry relating to the use of or ownership of particular pipes called 6-5/8 horizontal directional drilling pipes. It is unnecessary to deal with the substantive claims. It is sufficient for present purposes to make clear that orders are sought in the nature of mandatory injunction for the return of the pipes and damages.
The visual inspection is sought, on the material before the Court, for the purposes of, it is said, identifying the pipes as pipes that belong to the plaintiff. The orders are sought by the plaintiff. The effect of the inspection and, therefore, its purpose indirectly perhaps is twofold. First, it allows identification of the pipes, or may allow identification of the pipes, and, secondly, it would determine the current condition of the pipes; the latter aspect being one that affects whether the plaintiff will proceed with its claim for the return of the pipes in the substantive proceedings.
The defendants raise a number of issues. First, as already stated, these are proceedings between competitors in business. It has the usual reluctance to allow a competitor to examine its stock for any purpose. That reluctance is understandable. It is cynical of the capacity of the plaintiff to identify particular pipes as its own because the pipes that they believe to be the ones in issue have no markings of a kind that they can identify that would suggest that the pipes are of a particular batch or a particular ownership.
The Court is not unmindful of the reasonableness of a reluctance by one party in an industry to allow another in an industry, being a competitor, to inspect its stock. Indeed, on one view, such an inspection may itself be anti-competitive behaviour or affect competition. Nevertheless it seems to me that the purposes given by the plaintiff are proper purposes for the purpose of facilitating the proceedings.
The proper test under the Uniform Civil Procedure Rules 2005 (UCPR) is contained in r 23.8. That is, the orders would be made, only if, they facilitated the proper determination of the proceedings. I bear in mind the similarity of that terminology with the terminology in ss 56, 57 and 58 of the Civil Procedure Act 2005, which impose upon the Court, the parties and their legal representatives a duty to facilitate the just, quick and cheap resolution of the real issues in the proceedings. It seems to me that an inspection of the kind sought would, subject to a couple of aspects, facilitate the quick, just and cheap resolution of the real issues between the parties and the orders would facilitate the proper determination of the proceedings.
Rule 23.8 of the UCPR can be used for the purposes of non party inspections and, as has been described on a number of occasions, requires the Court to consider the inconvenience caused by any such inspection and issues such as those raised by the defendants relating to the arm's length relationship between competitors in an industry.
As to convenience, I am grateful for the candour of the defendants' and those they have called on their behalf and rely or refer particularly to the affidavit of Steven Patrick Buchanan of 3 September 2013, filed on 4 September, who is a legal representative or the legal representative of the defendants. Mr Buchanan candidly states in a manner that is continuingly relevant that he has made contact with the person who is either the owner or occupier of the premises upon which it is said the pipes are located and, subject to the convenience of that person, permission to access the yard for the purposes of a visual inspection can be facilitated. I am grateful for that indication.
The other matter that has been raised is whether the provisions of the UCPR and, in particular r 23.8, is applicable or whether as a matter of law this Court should apply, as I understand the argument, pursuant to its powers under one or other of the cross-vesting statutes, the rules that apply to proceedings in the Queensland Supreme Court.
The first matter, which requires some comment, is that I am unaware that the test for an inspection of property as it would be utilised by the Queensland Supreme Court is a test that is different from the test under r 23.8 of the UCPR. In dealing with "foreign" jurisdictions in this Court, is that unless otherwise advised, the assumption is that they would apply in the same way that the proceedings applies in this Court.
The second aspect is that it seems to me the argument, while ingenious, is misplaced. This is not an order that is dealing with land in another State. It is an order that is made for the purpose of facilitating civil proceedings.
The Civil Procedure Act 2005 applies to civil proceedings in this Court by virtue of the provisions of s 4 thereof. "Civil proceedings" are defined in s 3 as "any proceedings other than the criminal proceedings". It is not suggested these orders would be criminal proceedings or arise in criminal proceedings.
Therefore, the provisions of the Civil Procedure Act and by virtue of r 1.5 of the UCPR, the UCPR apply to all civil proceedings, including proceedings under s 23 of the Supreme Court Act 1970 of this kind. To the extent that no other power exists, which I doubt, the Court would have the jurisdiction to make an order of this kind for the inspection of property under the provisions of s 23 of the Supreme Court Act or under its inherent jurisdiction.
However, it seems also that the Court would have jurisdiction to make orders of this kind pursuant to the powers that arise from a jurisdiction conferred by combined effect of s 75 of the Constitution and s 39 of the Judiciary Act 1904. As a consequence of that, it seems to me the Court has authority to make the orders that have been sought.
Lastly, I deal with the question of costs. Essentially, the plaintiff argues that it should have the costs of and incidental to the motion on an indemnity basis. It does so, as I understand the submission, because of the "misconduct" of the defendants, namely that they have behaved, to use the words of counsel, "extraordinarily unreasonably".
The defendants have refused to allow the inspection of the pipes or facilitate the inspection of the pipes without pre-conditions. Those pre-conditions related to the plaintiff beforehand disclosing that which they say would identify the pipes as their own. It seems to me that the pre-condition that has been relied upon is a pre-condition that is not extraordinarily unreasonable, although in my view, inconvenient.
It is a pre-condition that arises from, dare I say it, the cynicism and competition that exists between persons engaged in the same industry and the reluctance of the defendants to have the plaintiff inspect all pipes held in stock without what it sees as a good reason or capacity to identify the pipes that are the subject of these proceedings. I consider that such a reluctance is reasonable, albeit it is not a condition I impose on the orders that I make.
However, I do make it a condition of the making of order 1 on the motion that the inspection occur at a time reasonably convenient to the occupier of the premises at which the pipes are located and that, if any markings or other information are said to be ones by which certain parts can be described, those markings or that information be disclosed as soon as practicable after the inspection occurs. In the foregoing circumstances and subject to the condition I have just described, I make the orders in the motion, save for the question of costs.
As to the question of costs, it seems to me that while the plaintiff has been successful on the motion and while there was resistance by the defendants to the motion, the plaintiff is seeking an indulgence beyond the ordinary course. That indulgence is one, that facilitates the conduct of the proceedings, but overall I take the view that costs should be costs in the cause.
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Decision last updated: 05 September 2014
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