Bocce Pty Ltd v City of Stirling
[2014] WASC 4
•10 JANUARY 2014
BOCCE PTY LTD -v- CITY OF STIRLING [2014] WASC 4
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 4 | |
| Case No: | CIV:1080/2013 | 29 NOVEMBER 2013 | |
| Coram: | REGISTRAR C BOYLE | 10/01/14 | |
| 12 | Judgment Part: | 1 of 1 | |
| Result: | Statement of claim struck out in part | ||
| C | |||
| PDF Version |
| Parties: | BOCCE PTY LTD CITY OF STIRLING |
Catchwords: | Pleading Application to strike out Principles Misfeasance in public office Whether sufficient facts pleaded Negligence Striking out where law uncertain Turns on own facts |
Legislation: | State Administrative Appeals Tribunal Act 2004 (WA) |
Case References: | Dansar Pty Ltd v Byron Shire Council [2013] NSWSC 17 Hall v The Governor & Company of the Bank of England [2000] EWCA Civ 140 Kimberley Downs Pty Ltd v Western Australia (Unreported, WASC, Library No 6414, 25 August 1986) MM Constructions (Aust) Pty Ltd v Port Stephens [2012] NSWCA 417 Neilson v City of Swan [2006] WASCA 94 Northern Territory of Australia v Mengel (1995) 185 CLR 307 Odhavji Estate v Woodhouse [2003] 3 SCR 263 Pancontinental Mining Ltd v Posgold Investments Pty Ltd (1994) 121 ALR 405 [414]; 13 ACSR 117 [127] Three Rivers District Council v Governor & Company of the Bank of England (No 3) [2003] 2 AC 1 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
CITY OF STIRLING
Defendant
Catchwords:
Pleading - Application to strike out - Principles - Misfeasance in public office - Whether sufficient facts pleaded - Negligence - Striking out where law uncertain - Turns on own facts
Legislation:
State Administrative Appeals Tribunal Act 2004 (WA)
Result:
Statement of claim struck out in part
Category: C
Representation:
Counsel:
Plaintiff : Mr P B Dobson
Defendant : Mr R J Price
Solicitors:
Plaintiff : Hotchkin Hanly
Defendant : DLA Piper Australia
Case(s) referred to in judgment(s):
Dansar Pty Ltd v Byron Shire Council [2013] NSWSC 17
Hall v The Governor & Company of the Bank of England [2000] EWCA Civ 140
Kimberley Downs Pty Ltd v Western Australia (Unreported, WASC, Library No 6414, 25 August 1986)
MM Constructions (Aust) Pty Ltd v Port Stephens [2012] NSWCA 417
Neilson v City of Swan [2006] WASCA 94
Northern Territory of Australia v Mengel (1995) 185 CLR 307
Odhavji Estate v Woodhouse [2003] 3 SCR 263
Pancontinental Mining Ltd v Posgold Investments Pty Ltd (1994) 121 ALR 405 [414]; 13 ACSR 117 [127]
Three Rivers District Council v Governor & Company of the Bank of England (No 3) [2003] 2 AC 1
- REGISTRAR C BOYLE:
Three refusals reconsidered
1 The plaintiff company was at the relevant time the registered proprietor of land in Hasler Road, Osborne Park. That is within the municipality that is the defendant. The plaintiff made three applications to the defendant in relation to the land.
2 The first, in September 2009, was for planning approval. The governing planning scheme contained a provision that an application not dealt with within a certain time was deemed to be refused. The application was not dealt with within the prescribed time and so was deemed refused. That triggered the plaintiff's rights of appeal. On appeal, the State Administrative Tribunal (SAT) invited the defendant to reconsider the application. On reconsideration, the defendant approved the application.
3 The second application in July 2010 followed the same path: application; failure to deal resulting in deemed refusal; appeal; invitation to reconsider; and approval on reconsideration.
4 The third application was made in April 2011 and the defendant refused it. On appeal, SAT invited reconsideration and on reconsideration the defendant approved the application.
5 The owner has sued, alleging the torts of misfeasance in public office and also negligence. I will consider each in turn below and analysis the pleadings summarised above in more detail.
6 I deal with the misfeasance claim before the negligence claim, but before dealing with either I will note the principles applicable to an application for striking out.
Grounds on which a statement of claim may properly be struck out
7 There is no controversy about the principles, which are well settled by binding authorities. In this State, the summary set out in the decision of Master Staples in Kimberley Downs Pty Ltd v Western Australia (Unreported, WASC, Library No 6414, 25 August 1986) has been referred to with approval on numerous occasions. Most relevantly for this application, it was specifically approval by the Court of Appeal (Wheeler JA, Pullin JA and Buss JA) in Neilson v City of Swan [2006] WASCA 94.
8 To the principles there laid out it can be added that the question is whether it would be open to the plaintiff upon the pleadings to prove facts at the trial which would constitute a cause of action: Pancontinental Mining Ltd v Posgold Investments Pty Ltd (1994) 121 ALR 405 [414]; 13 ACSR 117 [127].
The tort of misfeasance in public office
9 Actions for misfeasance in public office are not commonly brought, and rarely is such a case made out. The elements of the cause of action need to be analysed carefully.
10 That means that an application such as this engages principle 4 of the Kimberley Downs principles: extensive argument may be necessary to demonstrate that the plaintiff's case cannot possibly succeed.
11 The present state of the tort of misfeasance in public office has been considered at high appellate level in the United Kingdom in Three Rivers District Council v Governor & Company of the Bank of England (No 3) [2003] 2 AC 1, a decision of the House of Lords, and Hall v The Governor & Company of the Bank of England [2000] EWCA Civ 140, a decision of the Court of Appeal (Civil Division).
12 The High Court considered the applicable principles in Northern Territory of Australia v Mengel (1995) 185 CLR 307.
13 The Court of Appeal of this State considered all those authorities, and more, in Neilson.
14 In Neilson Buss JA (Wheeler JA and Pullin JA agreeing) referred with approval to the analysis by Lord Millett in Three Rivers (No 3) at [2003] 2 AC 1 [235]:
The tort is an intentional tort which can be committed only by a public official. From this two things follow. First, the tort cannot be committed negligently or inadvertently. Secondly, the core concept is abuse of power. This in turn involves other concepts, such as dishonesty, bad faith, and improper purpose. These expressions are often used interchangeably; in some contexts one will be more appropriate, in other contexts another. They are all subjective states of mind.
It is important to bear in mind that excess of power is not the same as abuse of power. Nor is breach of duty the same as abuse of power. The two must be kept distinct if the tort is to be kept separate from breach of statutory duty, which does not necessarily found a cause of action. Even a deliberate excess of power is not necessarily an abuse of power. Just as a deliberate breach of trust is not dishonest if it is committed by the trustee in good faith and in the honest belief that it is for the benefit of those in whose interests he is bound to act, so a conscious excess of official power is not necessarily dishonest. The analogy is closer than may appear because many of the old cases emphasis that the tort is concerned with the abuse of a power granted for the benefit of and therefore held in trust for the general public.
15 In this case the statement of claim invites the Court to infer the necessary mental element of the tort from the aggregate of a series of pleaded facts.
16 The individual in the employ of the defendant said to have acted in a way establishing the tort was a Mr Andre Gillot. I have outlined the three applications the plaintiff made to the defendant for various species of approval. In the case of the first two applications, the allegation is that Mr Gillot failed diligently to process the applications so that they could be considered by the defendant before they were deemed to have been refused. In the case of the third application, the allegation is that Mr Gillot did not act reasonably when assessing the application. The plaintiff thus seeks to establish its cause of action by combining one allegation of acting unreasonably with two allegations of unreasonably failing to act. (I add here that 'reasonably' and 'unreasonably' are the words used in the pleadings).
17 The differences between acting and failing to act as foundations of the tort were considered by Lord Millett in Three Rivers (No 3) at [236] - [237]:
The parties are agreed that there is no conceptual difference between sins of omission and sins of commission. This may be so; but factually there is a great difference between them. It is no accident that the tort is misfeasance of public office, not nonfeasance in public office. The failure to exercise a power is not in itself wrongful. It cannot be equated with acting in excess of power. The tort is concerned with preventing public officials from acting beyond their powers to the injury of the citizen, not with compelling them to exercise the powers they do have, particularly when they have a discretion whether to exercise them or not. There seems to be only one case in the books where a failure to exercise a power gave rise to the tort: R v Dythan [1979] QB 722, 727g, where Lord Widgery CJ said in terms that the neglect must be 'wilful and nor merely inadvertent'. Ferguson v Earl of Kinnoull (1842) 9 Cl & Fin 251 and the cases there cited were all cases of wilful breach of duty. Henly v Lyme Corpn 5 Bing 91 was in my opinion a case of breach of statutory duty, not of misfeasance in public office.
In conformity with the character of the tort, the failure to act must be deliberate, not negligent or inadvertent or arising from a misunderstanding of the legal position. In my opinion, a failure to act can amount to misfeasance in public office only where (i) the circumstances are such that the discretion whether to act can only be exercised in one way so that there is effectively a duty to act; (ii) the official appreciates this but nevertheless makes a conscious decision not to act: and (iii) he does so with intent to injure the plaintiff or in the knowledge that such injury will be the natural and probable consequence of his failure to act.
18 In Neilson Buss JA also referred with approval to Odhavji Estate v Woodhouse [2003] 3 SCR 263, where Iacobucci J said:
The tort is not directed at a public officer who is unable to discharge his or her obligations because of factors beyond his or her control but, rather, at a public officer who could have discharged his or her public obligations, yet wilfully chose to do otherwise.
The misfeasance pleading
19 It is now time to consider the plaintiff's pleading in detail. I note that the parties agree that the application should be treated as relating to an amended statement of claim filed 28 June 2013, even though that was filed after the defendant's application to strike out the statement of claim as it originally stood.
20 After identifying the plaintiff and defendant respectively, par 3 of the statement of claims sets out the position and duties of Mr Andre Gillot. Paragraph 3(b) pleads that Mr Gillot,
Owed a duty to the plaintiff to act reasonably, and to progress diligently, and in good faith, planning applications and applications to commence a development made to the defendant by the plaintiff inferred from the statutory time limits set for making a decision.
21 Appended as particulars to that subparagraph are details of the time limits in the various statutory instruments relating to the three applications, providing for deemed refusals if those applications were not dealt with within the times limited.
22 Paragraphs 4 - 10 of the statement of claim deal with the first application. As already outlined, this application was deemed refused because no determination of it was made by the defendant within the time prescribed. The allegation against Mr Gillot is set out in par 6:
In breach of the duty pleaded at paragraph 3(b) above, Andre Gillot took no steps, alternatively did not diligently progress the First Application.
23 Paragraph 7 pleads that the application was deemed refused on or about 3 October 2009. Paragraphs 8, 9 and 10 set out the history of: subsequent application to SAT for a review; orders by the Tribunal pursuant to s 31 of the State Administrative Tribunal Act inviting the defendant to reconsider; and approval on the reconsideration.
24 The history of the second application is set in pars 11 - 18. The central allegation against Mr Gillot in par 13 is identical to that in par 6 in relation to the first application.
25 Both the governing statutory provisions and procedure are slightly different. The second application followed the same path: of deemed refusal because it was not dealt with within the time limited; application to SAT; invitation by SAT for the defendant to reconsider; and approval by the defendant on reconsideration.
26 The third application is dealt with at par 19 - 26 of the amended statement of claim. This application was different in that it is pleaded that the defendant refused it. That is at par 22. Immediately preceding that at par 21 is the central pleading as to the nature of the offending conduct by Mr Gillot. That is different from what is set out at par 6 and 13:
21. Andre Gillot did not act reasonably when assessing the Third Application.
Particulars
- A. The plaintiff infers and will ask the Court to infer that Andre Gillot did not act reasonably by reason of the matters pleaded in paragraphs 22 and 23.
B. Further particulars may be provided after discovery and interrogatories.
28 Before dealing with the defendant's more general attack on the way the statement of claim is structured, it appears to me that there is a particular problem with the pleading in relation to the third application. That is that there is no link pleaded between Mr Gillot's not acting reasonably when assessing the application, and the refusal of the application. It is not pleaded what Mr Gillot's assessment was. Did he recommend refusal? Why? Did Mr Gillot's unreasonableness in assessing the application lead to its refusal? It seems to me to be critical to the plaintiff's cause of action that there be pleaded a link between Mr Gillot's claimed unreasonableness in assessing the application and the result of the application - that is, that the defendant (not Mr Gillot) refused it. It is not pleaded that for example, Mr Gillot recommended to the defendant that the application be refused for grounds that are pleaded (in par 23) to have been so unreasonable that no person acting reasonably could have made it.
29 The factual history is then drawn together by par 27 of the statement of claim:
27. By reason of the aggregate of those matters referred to in paragraphs 4 to 26 above, the plaintiff infers and will ask the Court to infer that Andre Gillot deliberately delayed the process of assessing and progressing the First Application and, the Second Application, and deliberately failed to act reasonably when assessing the Third Application.
30 Paragraph 28 pleads that Mr Gillot knew matters including: that the plaintiff intended to develop the property for financial reward; that a failure to assess the first and second applications, and a failure to act reasonably in assessing the third application, would be likely to cause damage to the plaintiff; and that those failures were 'outside the scope of his obligations and powers as Manager Approvals'.
31 Paragraph 29 invites the Court to conclude that by reason of the aggregate of the matters set out in par 4 - 30, Mr Gillot acted in bad faith, and par 30 pleads that the defendant is liable for any loss and damage occasion by his conduct.
Is the misfeasance pleading adequate?
32 As the authorities make clear it is not enough to ground the tort merely that a public officer failed to act as obliged. It is not enough even that the failure be unreasonable. It must be a failure that is deliberate and either intended to harm the plaintiff, or to the knowledge of the official likely to cause harm.
33 Where the tort is said to be constitute by positive action the mental state of the offending public officer must be as described by Brennan J in Mengel at [357]:
I respectfully agree that the mental element is satisfied either by malice (in the sense stated) or by knowledge. That is to say, the mental element is satisfied when the public officer engages in the impugned conduct with the intention of inflicting injury or with knowledge that there is no power to engage in that conduct and that that conduct is calculated to produce injury. These are states of mind which are inconsistent with an honest attempt by a public officer to perform the functions of the office. Another state of mind which is inconsistent with an honest attempt to perform the functions of a public office is reckless indifference as to the availability of power to support the impugned conduct and as to the injury which the impugned conduct is calculated to produce. The state of mind relates to the character of the conduct in which the public officer is engaged - whether it is within power and whether it is calculated (that is, naturally adapted in the circumstances) to produce injury.
34 The structure of this statement of claim is that the plaintiff does not plead the requisite mental element in relation to each of the three applications in turn. That is, the plaintiff does not plead that Mr Gillot deliberately chose not to process the first or second application, or that he made that deliberate choice either intending to harm the plaintiff, or knowing that it would harm plaintiff, or indifferent as to whether it would harm the plaintiff. Nor is there a distinct pleading of the mental element in relation to the third application. Rather, the Court is invited to infer from the totality of the circumstances the relevant state of mind.
35 Tying two - or three - stones together will not make them float.
36 The failure to process either of the first or second applications, or both taken together, is not capable of giving rise to an inference that the defendant by Mr Gillot deliberately failed to act and that this failure was actionable. Mr Gillot's failure to act could have been due to any one of a range of factors, including an excessive workload, misdirection by his superiors, his subordinates not properly doing their jobs, or even just not being very good at his job. More would be needed. For example, if the plaintiff were able to show that its applications were the only applications not processed within time at the relevant dates, that might contribute toward some colourable hope of success. As the pleading stands, evidence to that affect would not even be admissible: the form of the present pleading is that the plaintiff has limited itself to relying only on the concurrence of the bare histories of the three applications to make out its case.
37 The difficulties of proving misfeasance by omission are noted in the passage quoted above from Three Rivers (No 3), as cited in Neilson at [47]. Adding two otherwise unexplained episodes of claimed omission together does not get anywhere near discharging the burden: two instances is hardly sufficient to draw an inference of pattern. Given the defect I have already referred to in the pleading in relation to the third application - that there is no pleaded link between Mr Gillot's claimed unreasonableness and the refusal of the application - the history of the third application is not such as to be capable of giving rise to the inference the plaintiff asks the Court to draw. Given that the third application was an instance of commission rather than omission, the only pattern that might be said to emerge is that the three applications were either deemed to be refused or actually refused. The plaintiff may have been down nil-three at that point, but that of itself cannot establish a case of misfeasance against the defendant. To mix sporting metaphors slightly, three successful reviews does not show that the umpire was guilty of misfeasance.
38 For those reasons, pars 27 - 30 of the amended statement of claim must be struck out.
The negligence claim
39 The plaintiff claims, in the alternative to the cause of action in misfeasance in public office, that the defendant was negligent. That claim is articulated at pars 31 to 33 of the amended statement of claim. The defendant attacks the pleading on three, or possibly four, grounds.
40 The first is that the defendant owed no duty of care to the plaintiff; the second is that the failure of the defendant to discharge that duty (breach) is not properly pleaded; the third is that causation is not properly pleaded; and the fourth that damages are not properly pleaded.
41 To some extent, the attacks as to causation and damage relate to both causes of action.
Duty of care
42 In advancing the proposition that the defendant, as a matter of law, owed no duty of care to the plaintiff as an applicant for permissions, the defendant relies principally on the decision of the Court of Appeal of New South Wales in MM Constructions (Aust) Pty Ltd v Port Stephens [2012] NSWCA 417, and another New South Wales decision, Dansar Pty Ltd v Byron Shire Council [2013] NSWSC 17.
43 It was not agreed that the factual situations in those cases were the same as those in this. The defendant was not able to cite any High Court or Western Australian authority bearing directly on the point.
44 With the greatest respect to those eminent tribunals, those decisions are not binding on me. The sixth and final Kimberley Downs principle is that a court at first instance should be careful not to risk stifling the development of the law by summarily rejecting a claim where there is a reasonable possibility that, as the law develops, it will be found that a cause of action will lie. I do not think that it would be proper for me to strike out the negligence claim on the basis that no duty was owed. That there was controversy between the present parties about whether the facts in this case were materially the same as in those cases the defendant relied on makes a point: whether a particular defendant in particular circumstances owes a duty of care to a particular plaintiff is something that, outside well-known and established categories, depends on a careful examination of all the facts as developed by evidence. That can only happen at trial. I could not find that the plaintiff's case is on this ground unarguable. That really takes one back to the first Kimberley Downs principle: the rule is reserved for those claims that are not arguable.
Causation and damage
45 Paragraph 33 of the amended statement of claim pleads that,
By reason of the matters referred to in paragraphs 4 to 28 above, in breach of that duty, the defendant failed, or refused to take reasonable steps to properly assess the First Application, the Second Application and the Third Application.
46 That is followed at par 34 by the mere assertion that the plaintiff has suffered loss and damage, particulars of which are to be given after discovery and prior to trial.
47 Both pleadings are patently inadequate and embarrassing and must be struck out.
48 The defendant is entitled to insist that the plaintiff properly identify the material facts (they are not mere particulars) of how the defendant is said to have failed, or refused to take reasonable steps, to properly assess the applications. In fact, the plea is also embarrassing for duplicity: is the allegation failure or refusal?
49 Similarly, the material facts of damage must be pleaded. Quantum may be a matter for particulars, but the plaintiff must identify the damage claimed. That is particularly so in these circumstances where the ultimate result of the appellate processes is that in each case the defendant, having been invited to do so, eventually approved the plaintiff's application.
Should the plaintiff have leave to re-plead?
50 I have found that the amended statement of claim does not plead facts (nor would it allow evidence to be led) that would make it possible for the plaintiff to succeed at trial on the misfeasance claim. The negligence claim is inadequately made out but capable of remedy.
51 The question then is whether the plaintiff should be given leave to re-plead the misfeasance claim. In my view, it should be given one more opportunity to do so. That is because this is on any basis an unusual and difficult area of law. I have identified the defects in the plaintiff's case as presently pleaded. I simply do not know whether those advising the plaintiff have available to them evidence of facts that would, if added to the pleading, make an arguable case. Of course, because of the serious nature of an allegation of misfeasance in public office, there is a heavy professional obligation on the pleader to be satisfied that there is such evidence available. If there is not, the claim will have to be abandoned. The court can rely on the integrity of the practitioners as to this point. The plaintiff must accept advice on whether this claim can be maintained.
52 This is an application that was properly flagged at an early stage by the defendant; there has been conferral between the practitioners, leading to an amended statement of claim; and the application was fully argued with carefully considered written submission in support. However, I do not know whether the plaintiff has to hand or can reasonably obtain within a short time the facts that could be added to make a sustainable pleading. I think the plaintiff should be given a limited time within which to bring in a minute of proposed substituted statement of claim, and persuade the Court that it should be allowed.
53 There will be orders that pars 27 to 34 of the statement of claim be struck out and that the plaintiff have leave to bring in a minute of proposed substituted statement of claim within a time to be limited for the purpose. I will then hear the parties as to whether that should stand. The question of whether the plaintiff should have leave to re-plead is thus to that extent reserved. The plaintiff must pay the costs of the application to this point and I will hear counsel with a view to fixing those costs.
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