Blackburn v Logos Research Institute Pty Ltd (No 3)
[2016] SADC 97
•7 July 2016
DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
BLACKBURN & ANOR v LOGOS RESEARCH INSTITUTE PTY LTD & ORS (No 3)
[2016] SADC 97
Reasons for Decision of His Honour Judge Slattery
7 July 2016
EQUITY - EQUITABLE REMEDIES - SPECIFIC PERFORMANCE
Application by the plaintiff under R244 seeking orders against the third defendant requiring in her capacity as the sole director of the first defendant she carry out the defendants’ obligations under agreed minutes of order made by the Court on 18 January 2016.
Whether for R244, the Court is satisfied that the first defendant has disobeyed the orders made by the Court.
Whether the Court is satisfied that any basis exists for making an order against the third defendant under R244.
Held:
1. In order for the Court to make an order under R244 it is necessary to prove to the satisfaction of the Court the disobedience by the first defendant of an order of the Court.
2. The evidence before the Court does not disclose that the first defendant has disobeyed an order of the Court sufficient to attract the jurisdiction of the Court under R244.
3. Application dismissed with costs.
District Court Rules R 232, R 233, R244; Development Act s 69, referred to.
Blackburn & Anor v Logos Research Institute Pty Ltd & Ors [2015] SADC 175; Fitzgerald v Leonhardt (1997) 189 CLR 215; The Queen v JG Hammond and Co Ltd [1914] 2 KB 866; Pattison v Bell [2007] FCA 137; Davies v Beyond Building Systems Pty Ltd [2009] NSWCA 1282, discussed.
Butt v McDonald (1896) 7 QLJ 68; Secured Income Real Estate (Aust) Ltd v St Martins Investment Pty Ltd (1979) 144 CLR 596, considered.
BLACKBURN & ANOR v LOGOS RESEARCH INSTITUTE PTY LTD & ORS (No 3)
[2016] SADC 97JUDGE SLATTERY
Plaintiffs’ interlocutory application under Rule 244 dated 21 June 2016 (FDN131) in the following terms:-
1. That the third defendant Ellina Christi in her capacity as sole director of and sole shareholder in the first defendant cause the first defendant to carry out and fully comply with the order for specific performance dated 18 January 2016.
2. That the third defendant Ellina Christi in her capacity as sole director of and sole shareholder in the first defendant cause the first defendant to construct a retaining wall in accordance with the quotation of Retaining Wall Builder Bruce Colbert (“the builder”) dated 2 July 2014 as amended and with an engineering specification obtained by the builder on the first defendant’s land subject to Mitcham Council planning and building approval.
3. That the third defendant do all things reasonably necessary for the first defendant to obtain the approval of the second defendant.
4. That any such application for approval be made by the third defendant on behalf of the first defendant within 28 days of the date of this order.
5. That on all approvals being granted the third defendant take all reasonable steps to cause the builder to undertake the construction of the retaining wall in a workmanlike manner within 8 weeks.
6. That the third defendant provide the plaintiffs’ solicitor with a copy of the applications to Mitcham Council and a copy of the approvals from Mitcham Council within 7 days of lodging such applications and receiving such approvals.
7. That the third defendant forthwith do all such things and execute all such instruments as may be necessary for the first defendant and the third defendant to carry into effect the terms of the judgment and order made in this action on the 18th day of January 2016.
8. That the first and third defendant pay the plaintiffs’ costs of and incidental to this application.
9. Such further or other orders as this Honourable Court deems fit.
At the conclusion of the argument before me, I made orders dismissing the plaintiffs’ application. I said then that I would later deliver reasons for my decision. These are those reasons.
Rule 244 reads as follows:-
244—Powers directed at securing compliance with judgment by company
If a judgment against a company has been disobeyed, the Court may, on its own initiative or on application by a person entitled to the benefit of the judgment, make orders against a director, officer or other person who may be in a position of control or influence requiring the director, officer or other person to take specified steps with a view to securing the company's compliance with the judgment.
In support of the interlocutory application, the plaintiffs read the 18th affidavit of John Wayne Abbott sworn 20 June 2016 (FDN130), the affidavit of Trevor Kokkinakis sworn 1 July 2016 (FDN133) and the 20th affidavit of John Wayne Abbott sworn 1 July 2016 (FDN134). The first and third defendants read the affidavit of Ashley Alyce Cameron sworn 24 June 2016 (FDN132). Neither party sought to cross examine any of the deponents of the affidavit material filed in support or in opposition to the application.
In the background of this application is the judgment delivered by me in this action on 23 December 2015.[1] That judgment dealt with the plaintiffs’ application for summary judgment in the action under Rule 232 and Rule 233 of the District Court (Civil) Rules. The plaintiffs sought an order for enforcement of an agreement which they alleged had been reached between the parties on 12 September 2014. That agreement was allegedly made in the background of an action between the plaintiffs and the first and third defendant for nuisance arising out of an excavation (for a tennis court) by the predecessors in title of the first defendant of a hill upon which the plaintiffs’ home and land sat. The allegations in those proceedings were that the excavation of the hill has caused subsidence and therefore an actionable nuisance which could only be resolved by restoration of the hill or by the building of an appropriate retaining wall. As my judgment of 23 December 2015 describes, in the lead up to the trial and then the formation of the alleged agreement, there were exchanges of experts’ reports. There were also emergency orders made by the Mitcham City Council under s 69 of the Development Act for the plaintiff to abate a threat to safety as a result of the excavation either by reinstating the hill or alternatively constructing an engineered re-enforced wall of sufficient strength (to maintain the hill side and therefore to obviate any further slippage).
[1] Blackburn & Anor v Logos Research Institute Pty Ltd & Ors [2015] SADC 175.
The action between the parties was due to commence on 22 September 2014 and ten hearing days were set aside. As part of the management process for the trial, I had made orders with specific directions for a conclave of experts which was to be held no later than 17 September 2014. These orders and directions were particularly focussed on the engineering experts retained by the parties.
The conclave of experts did not occur as ordered by me and on 17 September 2014 I was advised by both parties that there had been a settlement between them.[2]
[2] As above at [72].
At paragraph [80] et seq. of my judgment, I set out the exchange of correspondence between the parties said to give rise to the settlement reached between them. It was this alleged contract of settlement which was the subject of the plaintiffs’ application for summary judgment. After considering the summary judgment argument, I formed the view that a contract (of settlement) had been formed between the parties on 12 September 2014. I found that the terms of the contract were reflected in the contents of the letter of the first defendant’s solicitors to the plaintiffs’ solicitor dated 11 September 2014 accepted by the plaintiffs’ solicitor’s letter of 12 September 2014 and as informed by the Retaining Wall Builder quotation signed by Mr Bruce Colbert dated 2 July 2014. I found that the obligation for the fulfilment of the retaining wall work fell upon the first defendant under the terms of the contract. I found that there was no reasonable basis for the first defendant to defend the claim of the plaintiffs that a contract was formed between them on 12 September 2014.
I then gave consideration to the question of the orders for specific performance sought by the plaintiffs. I decided that the plaintiffs had not sufficiently addressed the questions to be considered by the Court on such an application and I set out my reasoning at paragraph [138] et seq. of my judgment. I then gave leave to the plaintiffs to address further the question of specific performance. That matter was eventually set for hearing on 18 January 2016.
On that day, Mr N Swan appeared for the first and third defendants and the plaintiffs informed the Court of a resolution between the parties[3]. The parties had agreed terms of consent minutes of order. Orders were made by the Court in accordance with the request of the parties; they are set out hereunder. The salient point is that the consent minutes of order revolve around and are intrinsically connected to the settlement which the Court found was made between the parties on 12 September 2014. Consequently, the issues between the parties rise or fall upon the terms of that agreement.
[3] It has been a feature of this litigation that the first and third defendants have changed solicitors and counsel many times. The first and third defendants did not appear at the hearing of the plaintiff's application for summary judgment.
The first two orders in the interlocutory application are directed against the third defendant Eleni Christi. Ms Christi was joined in the proceedings in circumstances where the Court concluded that it was necessary to ensure the maintenance of the asset of the defendant company for the benefit of any judgment of the Court in favour of the plaintiffs. Ms Christi was the beneficiary under a bare trust, the trustee of which was the first defendant. Ms Christi is the sole director and shareholder of the first defendant. The relevant asset was the right of indemnity from the trust estate. If the trust estate was distributed in specie to the third defendant, that right may become worthless. At the time, distributions of portions of the trust estate to the third defendant Ms Christi as a beneficiary presently entitled had occurred.
On 18 January 2016 I made orders by consent for the final disposition of the action between the plaintiffs and the first and third defendants. Those orders were as follows:
THE COURT ORDERS that:
1. As between the Plaintiffs and the Defendant Logos Research Institute Pty Ltd the agreement between them made on 12th September 2014 referred to in the statement of claim for the construction of a retaining wall on the land situated at 18 Hannaford Road Blackwood is to be specifically performed and carried into execution.
2. The first defendant at its costs construct a retaining wall in accordance with the quotation of Retaining Wall Builder Bruce Colbert (“the builder”) dated 2 July 2014, as amended and with an engineering specification obtained by the builder, on its land subject to Mitcham Council planning and building approval.
3. The first defendant do all things reasonably necessary to obtain the approval of the second defendant.
4. Any such application for approval is to be made by the first defendant within 28 days of the date of this order.
5. On all approvals being granted the first defendant will take all reasonable steps to cause the builder to undertake the construction of the retaining wall in a workmanlike manner within 8 weeks.
6. The first defendant will provide the plaintiffs’ solicitor with a copy of the applications to Mitcham Council and a copy of the approvals from Mitcham Council within 7 days of lodging such applications and receiving such approvals.
7. The plaintiffs construct a galvanised ARC Garden safety fence in neutral tones on the entirety of the western boundary of their land to a height of 1.2 metres.
8. The plaintiffs and the first and third defendants forthwith do all such things and execute all such instruments as may be necessary to carry into effect the terms of this judgment and order.
9. Further consideration of these proceedings be adjourned.
10. The parties may apply for further directions and orders.
11. The counterclaim of the first defendant dated 16th April 2015 against the plaintiffs do stand dismissed and the plaintiffs shall have the costs of the counterclaim in any event.
12. The question of any other costs between the plaintiffs and the first and third defendants is reserved for further argument and consideration.
My judgment dated 23 December 2015 dealt with the plaintiffs’ allegations that the parties had entered into a settlement agreement on 12 September 2014 in compromise of the whole of the plaintiffs’ claim against the first defendant arising under an action for private nuisance. In my judgment, I found that the plaintiffs and the first defendant had made an enforceable contract and that the terms of their contract were reflected in the contents of the letter of offer of the first defendant’s solicitors to the plaintiffs’ solicitors dated 11 September 2014 which was accepted by letter of the plaintiffs’ solicitors dated 12 September 2014. In my judgment, I did not make orders for specific performance for reasons which I set out at paragraphs [138] et seq of my judgment. The question of whether there should be an order for specific performance was reserved for further consideration.
The issue of specific performance was therefore resolved by the agreement between the parties which is reflected in the orders that I made on 18 January 2016. Under order 1, the agreement of 12 September 2014 was to be specifically performed and carried into execution. It required the first defendant at its cost to construct a retaining wall in accordance with the quotation of Retaining Wall Builder Bruce Colbert (the builder) dated 2 July 2014 as amended and with an engineering specification obtained by the builder on the land of the first defendant and subject always to the Mitcham Council planning and building approval process. Under orders 3 and 8, the first defendant and the third defendant (as well as the plaintiffs) were to do all such things and execute all such instruments as may be necessary to carry into effect the terms of the judgment and order.
The offer of the first defendant which was accepted by the plaintiffs and which formed the terms of the contract between the parties is set out at paragraphs [81] and [82] of my judgment on 23 December 2015.[4] Those paragraphs read as follows:
[4] [2015] SADC 175.
[81]In a letter from Von Doussas, solicitors for the first defendant, dated 11 September 2014 and addressed to the solicitors for the plaintiffs, an open offer was made. It was in the following terms:-
OPEN OFFER
1. That the first defendant at its cost will construct a retaining wall in accordance with the quotation of retaining wall building Bruce Colbert dated 2 July 2014 (Builder) and the costs estimate of Jeremy Carter dated 31 July 2014 as amended, and with an engineering specification obtained by the Builder, on its land subject to Mitcham Council Planning and Building Approval (construction).
2. That the first defendant will do all things necessary to obtain the approval of the second defendant (SA Water).
3. That any such application for approval is to be made by the first defendant within 28 days of the date of the acceptance of this offer.
4. That on all approvals being granted the first defendant will take all reasonable steps to cause the builder to undertake the construction in a workman like manner within 8 weeks.
5. That the first defendant will provide the plaintiffs’ solicitors with a copy of the application to Mitcham Council and a copy of the approval from Mitcham Council within 7 days of lodging such application and receiving such approval.
6. That the proceedings listed for 22 September 2014 be adjourned to a date to be fixed.
7. That the plaintiffs construct a galvanised ARC Garden Safety Fence in neutral tones on the entirety of the Western boundary of their land to a height of 1.2m.
8. That the plaintiffs pay the first defendant costs of and incidental to the proceedings on a party/party basis as agreed or taxed save as to the costs order made in relation to the vacation of the hearing in December 2013 (Vacated Hearing). That the first defendant pays to the plaintiffs the costs of the Vacated Hearing in the amount of $5,000 or as taxed on a party/party basis.
9. This offer can be accepted in writing up to 2.00 pm on 12 September 2014 and after this time the offer will lapse. This offer can be accepted with or without paragraph 8. If paragraph 8 is not accepted then the matter of costs can be listed for argument.
As our client intends to construct the retaining wall your claim for injunction will fail. Further, there will be no damages as a result.
Next Steps
If your clients reject this offer or do not accept this offer our client proposes to approach the Court forthwith and to have orders made to vacate the conclave of experts. We propose to put before the Court the open offer that a retaining wall will be built by our client and the only matter that will be before the Court is the question of costs and we will seek to have that set down for hearing following the construction of the retaining wall. The amount of costs that is sought by your client is patently excessive and unlikely to be awarded by the Court. It is therefore not appropriate to run a 10 day hearing with a hope that your clients will be awarded costs.
We further demand that you provide a copy of all invoices for legal fees and disbursements for our client’s consideration.
Yours faithfully
VON DOUSSAS
[82]By letter dated 12 September 2014 addressed to Mr David Heppenstall at Von Doussas Solicitors, the plaintiffs through their solicitor Mr Wayne Abbott responded to the offer in the following terms:-
Dear David,
Re: Blackburn and Blackburn v Logos Research Pty Ltd
Thank you for your letter of 11 September 2014.
My clients have instructed me to accept the offer set out in paragraphs 1 to 7 of the Open Offer contained in that letter. My clients do not accept the offer set out in paragraph 8 of the Open Offer.
In respect of costs my clients seek from your client a contribution of $72,000 towards their party/party costs or their reasonable party/party costs to be agreed or assessed by the Court. Alternatively the question of costs (other than costs already ordered to be paid) can be determined by the Court once the agreed terms have been put into effect.
Yours faithfully
In his affidavit (FDN130), Mr Abbott informs the Court that as at 20 June 2016, he has not been provided with a copy of any application made to the Mitcham Council by the first defendant for planning and building approval in compliance with the orders made by me on 18 January 2016. In exhibit 41 to this affidavit of Mr Abbott are copies of correspondence between Mr Abbott’s firm and the firm of solicitors TressCox, the current solicitors for the first defendant. In a letter of 1 March 2016, TressCox inform Mr Abbott that they (the solicitors) have commissioned the Retaining Wall Builder (Mr Colbert) to obtain an engineering specification and that TressCox understood that the engineer would inspect the property that week to prepare the engineering specification. By letter of 3 March 2016 Mr Abbott reminded TressCox that order 4 of the orders made on 18 January 2016 required any application for approval by the third defendant made to the Mitcham Council to be filed and delivered within 28 days of the order. Neither of those orders had been complied with.
By letter of 7 March 2016, TressCox informed Mr Abbott that they had been in contact with Mr Colbert, had requested that he obtain the engineering specification and they had provided Mr Colbert with a copy of the orders of the Court and a further copy of his quotation of 2 July 2014. Contact had been made with Mr Colbert on 16 February 2016 and he had provided to the solicitors a costs estimate for the engineering specification. He was instructed to proceed with obtaining the specification in accordance with the previous quotation. TressCox followed up with Mr Colbert on 1 March 2016 and Mr Colbert indicated that he was having some difficulties with the engineer who hoped to be on site in the week commencing 29 February 2016. The solicitors were therefore still awaiting a copy of the engineer’s specification.
By letter of 29 March 2016, Mr Abbott wrote again to TressCox referring to the previous correspondence, the fact that the engineer was to inspect the site in the week commencing 29 February and that it was anticipated that the engineering specification would be prepared and delivered. No such specification had been delivered. Mr Abbott again reminded TressCox of the content of the orders of 18 January 2016 which required the lodgement with the Mitcham City Council of the application for planning and building approval by 15 February 2016. No such documents had been provided. No reply was received to the letter of Mr Abbott of 29 March 2016 and on 16 May 2016 he again wrote to TressCox solicitors and informed them that unless the first defendant complied with the orders requiring it to lodge with the Court the application for approval of the retaining wall, the plaintiffs would seek an order that the third defendant be required to take steps with a view to securing the compliance of the first defendant with the terms of the orders made by the Court on 18 January 2016.
TressCox responded to the letter of Mr Abbott of 16 May 2016 by a further letter of 23 May 2016. TressCox reminded Mr Abbott that the terms of the order of 18 January 2016 required a retaining wall to be built in accordance with the quotation of Colbert of 2 July 2014 and with an engineering specification obtained by the builder. TressCox confirmed that instructions had been given by them to the builder to obtain the engineering specification. So much is obvious from the earlier correspondence. The solicitors TressCox then suggested that the obtaining of an engineering specification is now outside of the control of the first defendant. TressCox informed Mr Abbott that follow up attempts with the builder had been made on 22 March 2016, 29 March 2016, 18 April 2016 and 19 May 2016. These communications enquired as to the progress of the obtaining of the engineer’s specifications. They informed that the builder now says that he is unable to re-engage the engineer previously involved in the matter and that he has attempted to engage with the engineer retained by SA Water as well as two other alternative engineers. Absent the engineering specification, it is impossible to make an application to Mitcham Council for development approval.
The affidavit of Mr Cameron contains one exhibit identified as “AAC1”. The exhibit is page numbered. It contains, inter alia, copies of the correspondence passing between solicitors that I have summarised above. In pages 73-79, there is an email trail of communications between TressCox and the builder. In an email of 17 June 2016, addressed to TressCox, the builder says as follows:
Good afternoon.
In my opinion, the walling work on this site has become greater than first quoted and I would comfortably say that it is no longer in my capability. Factors now are more accessed to large cranes to get into the site to lift larger drilling equipment into the site had me thinking it can’t be done that way anymore. My quote was based on engineering and it requires more than originally thought.
In my view, from what engineering has been provided, I am unable to complete the works required as it is out of my scope of expertise.
Regards,
Bruce Colbert
In the 20th affidavit of Mr Abbott, the Court is provided with copies of email correspondence between the former counsel for the first defendant, Mr Miller QC and Mr Eardley and Mr Lyndon Sanders of the firm Golder Associates Pty Ltd, the engineers formerly retained by the first defendant. That email chain indicates that Golder Associates Pty Ltd reached a point where it was no longer prepared to assist the first defendant absent satisfaction of its outstanding accounts for professional services rendered. In paragraphs 13, 14 and 15 of his affidavit of 1 July 2016, Mr Abbott avers that there has been no material change to the area in which the retaining wall is to be constructed or is likely to be affected by the proposed construction and therefore the facts disclosed in the affidavit of Mr Cameron sworn 24 June 2016 do not disclose a genuine attempt by the first defendant to do all things necessary to carry into effect the terms of the judgment and order.
In his affidavit sworn 1 July 2016, Mr Kokkinakis said that he had read the quotations of Colbert and expresses the opinion that a retaining wall can be constructed at the rear of the property in accordance with the method of construction set out in the quotation under the supervision of an engineer. At paragraph 6 of his affidavit, Mr Kokkinakis says:
6.I am of the opinion that a professional consulting engineer who works in the civil/structural field could prepare an engineering specification for the construction of a retaining wall at the rear of the property at 18 Hannaford Road Blackwood in accordance with the method of construction set out in the quotation in sufficient time to enable an application for planning and building approval to be lodged with the Council within 28 days from the date on which instructions for the preparation of the specifications are given.
7.There are many engineers practicing in Adelaide who are competent to prepare such a specification.
I have no reason to doubt and I accept the evidence given by Mr Kokkinakis. There is no explanation why Colbert did not seek out Mr Kokkinakis as the person to provide the specification when he appears (unsuccessfully) to have attempted to make contact with the engineers for the second defendant, SA Water. There is no explanation for that oversight.[5]
[5] An obvious observation is that Colbert has not had the benefit of a specification prepared by an engineer such as Mr Kokkinakis.
It is in that background that I consider this application under Rule 244. The first defendant and the third defendant came to the Court to meet an application under that Rule. In the course of submissions before me, it became clear that there was no evidence that the third defendant had acted in any way to stultify the orders made by me on 18 April 2016. In argument the plaintiffs contended that the basis of the application before me was that the obligations of the first and third defendants under the orders could not be abdicated to solicitors or a builder because the obligations fall upon the first defendant. That contention re‑emphasises that under a Rule 244 application, the attack becomes one upon the third defendant rather than the first defendant because it may be seen as an application preparatory to a charge of contempt being made against the third defendant. The plaintiffs submitted that it is the responsibility of the first and third defendant to retain a wall builder in the event that Colbert ‘washes his hands’ of the job. The orders that I made by consent of the parties and at their request was for the first defendant at its costs to retain Colbert to build the retaining wall in accordance with his quote of 2 July 2014. This was in accordance with the settlement reached between the parties.
The plaintiffs submitted that the first defendant had failed to comply with the terms of the order of the Court in that it had failed to retain the builder. I am unable to agree with that submission. I am satisfied both from the affidavit evidence of Mr Abbott and the material contained within the affidavit of Mr Cameron that through the agency of the solicitors, the first defendant gave clear instructions to the builder to retain the engineer to prepare the relevant specification to be placed before the Council. This was in conformance with the order of the Court made by consent of the parties.
The first and third defendants now contend that the position reached is that the matter is at an end. They assert there has been a frustration of the contract of settlement due to circumstances out of the control of any of the parties. As no submissions have been made to me on that issue I need express no view. However that contention of the first and third defendants may be contrasted with the actual terms of the offer of the first defendant set out in paragraph [81] of my judgment. I make further reference to the terms of this offer in paragraphs [113] and [114] of my judgment. As I have not received any submissions on these matters I will leave them to one side also.
The plaintiffs then relied upon the fact that Golder and Associates Pty Ltd, engineers, had refused to undertake any further work because of a failure by the first defendant to pay them for previous professional services. The plaintiffs submitted that the reason why the first defendant has not been able to obtain an engineering specification is because of a refusal by the first defendant to pay their engineers for earlier work. As a result the first and third defendants were in breach of the settlement agreement because they failed to do all such things necessary to carry into effect the terms of the judgment. The first and third defendants met that contention by pointing to the evidence before me that the builder had sought out other engineers (unsuccessfully) and finally came to the conclusion that he could not fulfil the basis of his quotation. These are two different things. As I have not heard from the builder I am unable to do any more than express my dissatisfaction that the builder did not seek out Mr Kokkinakis and that he is not in a position to undertake the work. The plaintiffs are undoubtedly distressed by these events: it is a very unsatisfactory situation.
The plaintiffs also reject the contention by the first and third defendants that the contract had been frustrated and contend that the first defendant had not complied with the orders and therefore an order may be made against the third defendant. This was because the first defendant has not made genuine attempts to discharge the obligations upon it and it is incumbent upon it to proceed to obtain the specification. The plaintiffs contend, and I accept, that it is plain that the builder could obtain an engineering specification. This is because I accept the evidence of Mr Kokkinakis that such a specification could be prepared. However, whether my acceptance of his evidence assists the plaintiffs is a matter to be seen.
Finally, the plaintiffs contend that there has been no satisfactory explanation given as to why the builder who quoted on a number of occasions and said that a job quoted could be done then says that the job is too hard and cannot be done. The plaintiffs complain that no evidence has been tendered in an affidavit or other form from the builder or anyone else who may give such evidence on an admissible basis to explain why that was impossible. The plaintiffs then contend that in the absence of such information, the only thing the plaintiffs could do was to draw the conclusion that the real reason was because the persons from whom the specifications were sought refused to provide their cooperation because they had not been paid.
The plaintiffs relied upon a number of authorities,[6] and I will discuss them briefly below. In the present circumstances they do not greatly assist the plaintiffs.
[6] Fitzgerald v Leonhardt (1997) 189 CLR 215 at 219; The Queen v JG Hammond and Co Ltd [1914] 2 KB 866.
The decision of the High Court in Fitzgerald affirmed the rule (see Griffith CJ in Butt v McDonald (1896) 7 QLJ 68 at 70-71; Secured Income Real Estate (Aust) Ltd v St Martins Investment Pty Ltd (1979) 144 CLR 596 at 607) that it is an implied term in every contract that each party must do all such things as are necessary on their part to enable the other party to have the benefit of the contract. This is a rule of broad application and may be used as part of the armoury of the Court to make orders to assist a party who is dealing with a recalcitrant counter party. In Fitzgerald the rule required the landowner to get the permits necessary to enable the drilling for water to occur. But that is not this case. The material before me on this more narrow application does not support a basis for the Court to make any order on the question of a party being under an obligation to fulfil a contractual obligation. Those authorities may well be of assistance to the plaintiffs on a different application.
The first and third defendants contend that on a Rule 244 application it is necessary first to identify that the judgment of the Court has been disobeyed. The ordinary meaning of that word taken from dictionary definitions is a deliberate non-compliance with an order or direction and this could include merely ignoring such an order or direction. That is an entirely different case from the situation where the factual circumstances have turned out quite differently than may have been contemplated by the terms of the order. The first and third defendants emphasise that it was Colbert who said the wall could be built and that he could obtain an engineering specification for the wall. That has not occurred in circumstances that were entirely out of the control of the first and third defendants. Thus, it could not be said that the first basis of the application could be made out, as the plaintiffs could not establish that the first and third defendants have disobeyed any order of the Court.
The first and third defendants then submitted, but I do not accept, that it was not possible to subpoena Mr Colbert who could for example explain to the Court that he was too busy to do this job. The suggestion for example that all that Mr Colbert would say that he was too busy is not in any sense a persuasive submission and does not assist the first and third defendants. However I consider that the first and third defendants are correct when they say that disobedience of the orders of the Court has not been disclosed. The first and third defendants relied upon the Federal Court decision in Pattison v Bell[7] and Davies v Beyond Building Systems Pty Ltd.[8]
[7] [2007] FCA 137.
[8] [2009] NSWCA 1282 per Brereton J.
The decision in Pattison v Bell concerns a contempt case and the relevant discussion commenced at paragraph [34]. There Gray J confirmed what is perhaps a fairly obvious and fundamental proposition: that a person should not be found guilty of contempt of Court for ‘… failing to do something that could not be done’. This proposition is really no more than an extension of the proposition that a person cannot be in contempt of a Court order that is so vague and poorly drawn that it is incomprehensible. In light of my decision that case needs no further discussion.
The decision of Brereton J in Davies concerns an interlocutory application to vary extant orders, costs and a late application to further amend the statement of claim. Leave was refused because on the face of the proposed amendments no legal conclusion was pleaded to flow from the facts alleged and so no viable cause of action was disclosed. The relevance of this decision is not immediately apparent.
The first and third defendants also point to the fact that the order was made by consent, it was in terms that were agreed between the plaintiffs and the defendants and it was an order in aid of the plaintiffs’ application to enforce an agreement that they said was made with the first and third defendants. If there is any ambiguity within the order, then that is a matter that lays with the plaintiffs. Ultimately, it cannot be shown that there has been a disobedience of the order because all of the communications emanating from the firm of solicitors TressCox, show that they have been diligent in following up with the obligations of the defendants and have done everything in their power, as could have been done by the first and third defendants, to comply with the orders of the Court.
I accept the submissions of the first and third defendants in that respect, only on the basis that I consider that the test prescribed under Rule 244 has not been satisfied. I do not consider that the judgment against the company has been disobeyed in light of the material placed before me in the affidavits read by the parties. The wording of clause 2 of the orders of 18 January 2016 requires the first defendant at its cost to construct the retaining wall in accordance with the quotation of Colbert and in accordance with an engineering specification obtained by Colbert. It would not be until such time as the engineering specification is obtained (by the builder) that an application could be made to the Mitcham City Council for planning and building approval. Both the first and third defendants were required to do all things necessary to obtain the approval of the second defendant SA Water and the evidence discloses that SA Water has not raised any objection. The eighth order requires the third defendant to do all such things and execute all such documents to carry into effect the terms of the order. If it could be said that the third defendant has not complied with that order and, as a result, the first defendant has been in breach of the order or has disobeyed the order, then an application could ordinarily be made against the third defendant for failure to so act. The evidence before me does not justify an assertion that the third defendant has disobeyed the terms of the order.
I am not satisfied that the plaintiffs have established any basis for the orders that they seek and I would dismiss the application. In light of the order of 18 January 2016 I also can see no basis or utility in making the orders sought by the plaintiffs. This view does not circumscribe or limit the capacity of the Court to hear and determine any other applications brought by the plaintiffs on some different grounds. That is a matter for the plaintiffs.
The plaintiffs’ application is dismissed and the first and third defendants are to have the costs of the application. Certificate for counsel.
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