Allstate Explorations NL v Beaconsfield Gold

[1999] NSWSC 482

CITATION:	Allstate Explorations NL & Ors v Beaconsfield Gold & Ors [1999] NSWSC 482
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	3089/98
HEARING DATE(S):	18 May 1999
JUDGMENT DATE:	18 May 1999
PARTIES :	Allstate Explorations NL (P) Beaconsfield Gold NL (D)
JUDGMENT OF:	Master McLaughlin

COUNSEL :	Mr. A. W. Street, SC; Ms. R. Pepper (P) Mr. J. Styring (D)
SOLICITORS:	Blake Dawson Waldron (P) Phillips Fox (D)
CATCHWORDS:
DECISION:	See paragraph 17

- 1 -

SUPREME COURT OF
NEW SOUTH WALES
EQUITY DIVISION

MASTER McLAUGHLIN

Tuesday, 18 May 1999

3089/98 ALLSTATE EXPLORATIONS NL & ORS -v- BEACONSFIELD GOLD NL & ORS

JUDGMENT

1 MASTER: By notice of motion filed on 3 May 1999 the plaintiffs, Allstate Explorations NL, Allstate Prosecting Pty Ltd and ACN 070 164 653 Pty Ltd seek substantively an order pursuant to Part 31 rule 2 of the Supreme Court Rules, that certain questions set forth in the schedule to that notice of motion be determined separately from any other question or issue in the proceedings and before any final hearing of the proceedings. That application is contested by the defendants, Beaconsfield Gold NL, Beaconsfield Operations Pty Ltd and Beaconsfield Tasmania Pty Ltd. 2 The substantive proceedings arise out of what is referred to as the Beaconsfield Mine Joint Venture Agreement. 3 There have been a considerable number of pleadings filed in these proceedings, including pleadings in relation to a cross-claim brought by the defendants. There have already been a number of interlocutory applications made in these proceedings. 4 In support of the notice of motion there has been filed an affidavit by Gary Lance Kent sworn on 12 May 1999, he being the member of the firm of solicitors for the plaintiffs who is directly responsible for the conduct of the proceedings. Mr Kent refers to evidence upon which the plaintiffs proposed to rely for determination of the proposed separate questions. He expresses an estimate that a trial of the entire proceedings would occupy approximately three days but that the determination of the separate questions should occupy no more than three to four hours, and refers to the costs which would be incurred having a full trial of the proceedings, rather than a determination of the separate questions. 5 I have been taken to a number of authorities relating to the circumstances in which it is appropriate that the Court should order separate determination of questions before a final hearing. In particular, I have been taken to the decision of the Court of Appeal in CBS Productions Pty Ltd v. O'Neill (1985) 1 NSWLR 601 (especially the judgment of the then President, Kirby P.) In that case the Court held (as set forth in the headnote):

The procedure under Pt 31 r 2, should be confined to cases which are ripe for this treatment; a matter is ripe for separate and preliminary determination where it is a central issue in contention between the parties, the resolution of which will either obviate the necessity of litigation altogether or substantially narrow the field of controversy.

6    I have also been taken to the decision of Giles CJ Comm. Div. in Tallglen Pty Ltd & Anor v. Pay TV Holdings Pty Ltd & Ors (1996) 22 ACSR 130 where his Honour said at p 141 concerning this procedure:

In the ordinary course all issues in proceedings should be decided at the one time, but separate decision of a question may be appropriate where, for example, the decision of the question is critical to the outcome of the proceedings and (at least if decided in one way) will bring the proceedings to an end. In particular circumstances the separate decision of a question may be appropriate even if it will not bring the proceedings to an end, such as where there is a strong prospect that the parties will agree upon the result when the core of their dispute is decided or where the decision will obviate unnecessary and expensive hearing of other questions, but such occasions must be carefully controlled lest fragmentation of the proceedings (particularly when the exercise of rights of appeal is borne in mind) brings delay, expense and hardship greater than that which the making of an order was intended to avoid. It is often the case that the need to make findings of fact for a decision of the separate question, especially findings which may involve issues of credit, tells strongly against the making of an order because related facts, and renewed issues of credit, will or may arise at a later stage in the proceedings. Experience teaches that it should be able to be seen with clarity that decision of a separate question will be beneficial in the conduct of the proceedings and the resolution of the parties' dispute.

7    I have also been taken on behalf of the defendants to a number of other decisions, including Carl Zeiss Stiftung v. Herbert Smith & Co & Ors (1968) AC 93, the judgment of Lord Denning MR and Radstock Co-operative & Industrial Society Limited v. Norton-Radstock Urban District Council (1968) 1 Ch 605. In that latter case Harmon LJ said at 624:

"At this juncture I should like to protest against this method of procedure. This is not a preliminary point at all. It deals with the whole subject-matter of the action, and without any evidence, and the court is left in a most unsatisfactory position and has to guess at many things which, on a hearing would be properly proved in evidence."

8    Essentially, the defendants submit that the matter is not one which is, in the words of the Court of Appeal in CBS Productions Pty Ltd v. O'Neill, "ripe for this treatment". The defendants submit that answers to the first two of the five questions will not result in a determination of the proceedings as a whole, because there will still remain in issue the defendants' assertion that the plaintiffs, irrespective of the construction of the joint venture agreement and irrespective of the legal rights of the plaintiffs under that agreement, are yet in breach of a fiduciary duty which, so the defendants assert, the plaintiffs owed to the defendants. 9    Further, the defendants submit that the remaining three questions which are posed by the plaintiffs in the present application are questions which require findings of fact for their determination and that it is inappropriate that disputed questions of fact in this case should be the subject of questions determined separately and before a final hearing of the totality of the proceedings. 10    As I understand it, it is submitted on behalf of the plaintiffs that if the answers to the questions posed are in one direction, then those answers will be determinative of the proceedings as a whole, but if the answers are in the other direction, then the matter must, of necessity, go to a final hearing. 11    The Court is given a discretion to make an order of the nature which is presently sought. The procedure is not limited to cases which are regarded as extremely lengthy or extremely complex or extremely expensive. The purpose of the procedure is to facilitate a determination of disputes. But it is not to deprive a party of the entitlement of that party to have its case heard in an appropriate fashion by the calling of evidence and the cross-examination of witnesses concerning disputed questions of fact. The disadvantages of the procedure are highlighted in the extracts which I have read from the decisions of Giles J in Tallglen and of Harmon LJ in Radstock. 12    Where, as here, the decision on the questions will not, of necessity, result in the determination of the proceedings, but will result in such determination only if the answers go in one direction, it seems to me that the defendants should not be deprived of their right to have the matter heard at a final hearing of the entirety of the proceedings. That is especially so where, as here, the defendants have raised on the pleadings the assertion that the plaintiffs are in breach of a fiduciary duty, and especially to where, as here, a decision on some, at least, of the questions must depend upon disputed questions of fact. 13    I am not satisfied, therefore, that it is appropriate that the Court should make an order of the nature which is sought in the present application. Accordingly I propose to dismiss the notice of motion of the plaintiffs. 14    Does anyone wish to address me concerning costs? 15    (Mr Styring sought costs of the notice of motion.) 16    (Mr Street submitted it should be a question of the defendants' costs in the cause.) 17    MASTER: I do not need to hear you on the question of assessment, Mr Styring. As a matter of course, I make an order of the nature which you have referred to. I make the following orders:

1. I order that the notice of motion filed by the plaintiffs on 3 May 1999 be dismissed.
2. I order that the plaintiffs pay the costs of the defendants of the aforesaid notice of motion.
3. I grant leave to the defendants to proceed forthwith to assessment of the foregoing costs.
All exhibits may be returned.

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