Bond Corporation Pty Ltd v Thiess Contractors Pty Ltd
[1987] FCA 64
•24 FEBRUARY 1987
Re: BOND CORPORATION PTY LIMITED
And: THIESS CONTRACTORS PTY LTD and OVE ARUP PTY LTD; ARUP PARTNERS PTY LTD
and OVE ARUP CONSULT PTY LTD
No. WA G114 of 1986
Practice and Procedure
COURT
IN THE FEDERAL COURT OF WESTERN AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
French J.
CATCHWORDS
Practice and Procedure - Engineering construction dispute - application for stay of proceedings under s.86 of the Trade Practices Act 1974 pending determination of arbitration - application to restrain party from prosecuting arbitration - application to stay or dismiss claim - abuse of process - no reasonable cause of action frivolous and vexatious proceeding - schedule of rates contract for road and earthworks for subdivision - precontractual representations - alleged misleading and deceptive conduct - tort and breach of contract also alleged against construction engineer - consulting engineers as co-defendants - construction engineer claims short payment - refers claim to arbitration - power of court to stay proceedings pending arbitration - inherent power - application to Federal Court of s.53 Commercial Arbitration Act 1985 (WA) - direct application - application by operation of s.79 Judiciary Act 1903 - principles regulating grant of stay - power to restrain party to arbitration - principles applicable - summary dismissal - principles applicable.
Trade Practices Act 1974 ss. 52, 82
Commercial Arbitration Act 1985 (WA)s.53
Judiciary Act 1903 s.79
Federal Court of Australia Act 1976 s.23
Federal Court Rules O.20, O.11
Huddart Parker Ltd v The Ship Mill Hill (1950) 81 CLR 502
G.W.J. Blackman & Co. SA v Oliver Davey Glass Co. Pty Ltd (1966) VR 570
W.C. Thomas & Sons Pty Ltd v Bunge (Australia) Pty Ltd (1975) VR 801
Halifax Overseas Freighters Ltd v Rasno Export ("The Pine Hill") (1958) 2 Lloyds Rep. 146
The Eschercheim (1974) 3 All ER 307
Tasmanian Pulp and Forest Holdings Ltd v Woodhall Ltd (1971) Tas. SR 330
W. Bruce Ltd v J. Strong (1951) 2 KB 447
St. Justins Properties Pty Ltd v Rule Holdings Pty Ltd (1980) 40 FLR 282
Stack v Coast Securities (No. 9) Pty Ltd (1983) 154 CLR 261
HEARING
PERTH
#DATE 24:2:1987
Counsel for the Applicant: Mr S.J. Archer
Solicitors for the Applicant: Robinson Cox
Counsel for the First Respondent: Mr R. Davis
Solicitors for the First Respondent: Keall Brinsden
Counsel for the Second Respondent: Mr L.E. James
Solicitors for the Second Respondent: Kott Gunning
ORDER
The First Respondent its servants or agents be restrained until further order from prosecuting an arbitration between the First Respondent and the Applicant in accordance with the Notice of Reference to Arbitration served by the First Respondent on 12 September 1986.
The First Respondent have liberty to apply to vary or set aside this order on 48 hours written notice.
The First Respondent's motion dated 16 December 1986 be dismissed.
Costs of both motions be reserved.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
JUDGE1
This case concerns time and cost overruns in the performance of a contract for the provision of road and associated earth works for a residential subdivision.
The aggrieved developer sues both the civil engineer responsible for the conduct of the works (the first respondent) and the consulting and supervising engineers responsible for their design, cost and time estimates, tender documentation and supervision (the second respondents).
The first respondent says that it has not been paid by the applicant for all the work that it has done and wishes to claim the shortfall.
Under the terms of its contract it has referred that claim to arbitration and it wishes the arbitration to proceed.
The applicant wants all matters in issue between it and the respondents resolved in this court and invites the first respondent to pursue its claim by way of cross claim in these proceedings.
To effect that objective it now moves for an order restraining the first respondent from prosecuting the arbitration until further order.
The first respondent on the other hand seeks a stay of the proceedings in this court, insofar as they relate to it, until the arbitration is concluded.
In the alternative it moves for an order staying or dismissing generally the claim against it on the grounds that no reasonable cause of action is disclosed by the statement of claim and that so far as they relate to the first respondent the proceedings are frivolous or vexatious and an abuse of the process of the Court.
The motions involve factual considerations which are not completely straight forward and it is necessary to refer in some detail to the history of the dispute and the background to the institution of these proceedings.
Factual Background
The applicant owns land at Millenden, 11 kilometres north of the town of Midland which lies about 30 kilometres east of Perth.
The land was acquired in 1982 for development as a residential subdivision under the name "Brigadoon Country Estate".
The applicant engaged the second respondents to act as consulting and supervising engineers for road, earth and drainage works associated with the subdivision.
In November 1984 the second respondents provided the applicant with a cost estimate for work on stage 1 of the project. The estimate was $1,285,700.00. This figure was given prior to certain changes to the works which, according to the second respondents, would have altered their estimated total cost to $1,417,500.00.
Tender documents for a Schedule of Rates Contract were prepared by the second respondents in January 1985 and tenders were invited.
The General Conditions of Contract AS2124-1981 published by the Standards Association of Australia were to be incorporated in the contract.
Practical completion of the works was to be achieved by 21 June 1985.
Four companies tendered and the results of their tenders were as follows:-
1. Thiess Contractors Pty Ltd $2,169,256.00
2. Leightons Contractors Pty
Ltd $2,233,059.00
3. Consolidated Constructions $2,828,743.10
4. McMahon Constructions Pty Ltd $3,077,118.00
As is apparent the lowest figure, that provided by the first respondent, considerably exceeded the second respondents' estimate.
In a letter dated 13 February 1986 informing the applicant of the tender results the second respondents explained the shortfall between their estimate and the lowest price tendered as attributable to:-
(a) The very short construction period.
(b) Weather.
(c) The need to let a single large contract to produce 150 lots rather than staging the work as had originally been envisaged.
(d) The fact that the predicted volume of excavation in soft and hard rock based on the completed design, geological reports and an inspection of pegged alignments exceeded their intitial estimates.
Their advice to the applicant was as follows:-
"It is our considered opinion that you will not achieve substantial savings or meet your sales program by recalling tenders. The works cannot be staged using smaller contractors working simultaneously because of clashes with access to and from the gravel pit sites. We would therefore recommend that negotiations be conducted with the two lowest tenderers in order to reduce the price from (sic) $1,786,000.00 approximately and that the lowest of the resulting prices be accepted."
Some discussion followed between the first and second respondents. The second respondents wrote to the first on 19 February listing a number of "cost saving suggestions" arising out of the discussions in relation to certain elements of the works and as a consequence of which they sought adjustment of the tendered rates.
The first respondent replied by letter the following day, 20 February, attaching a schedule of revised rates for some 6 items.
Three further items were quoted at a reduced rate in a telex later on the same day.
There is no evidence of further discussion before 22 February when the second respondent sent a letter to the applicant advising it that they had conducted negotiations with the two lowest tenderers. The letter asserted that the negotiated price of the first respondent was now $1,764,953.00. Leighton Contractors were said to have reduced their price by $201,600.00 giving a negotiated final price of $1,890,459.00.
As the state manager for the first respondent Mr Jukes said in his affidavit, the cost savings which had been suggested by the first respondent to the second respondents were of an insignificant order when compared to the reduction claimed in the letter of 22 February.
The text of the second respondents' letter does not seem fully to reflect the fact that the contract in issue was a Schedule of Rates and not a lump sum contract.
The first respondent according to Jukes was at this time aware that certain changes were planned to the scope of the works but did not know how the second respondents had arrived at the reduced "negotiated price" and the reduction and scope of works upon which it was based.
Ultimately on 11 April 1985, when the performance of the contract had been under way for a month, the first respondent did receive a breakdown of the new total from the second respondents. In the breakdown were a number of significant scope changes and other reductions which in Jukes' view "were designed to artificially reduce the tender price".
He was not concerned with what he described as "this manoeuvre" as the contract was a Schedule of Rates Contract. He said in his affidavit:-
"While the scope of the works had been reduced from that for which the first respondent had tendered and the price reduced proportionately on the basis of the first respondent's tendered rates, the first respondent knew that if the second respondent subsequently increased the scope of works the first respondent would be entitled to be paid in accordance with the terms of the contract."
This statement according to counsel for the applicant, showed on the part of Jukes a cynical disregard for the applicant's rights and position.
With all due respect I cannot accept that submission. On the material presently before the court, Jukes was simply adverting to the fact that if there were an alteration to the scope of the works the first respondent would be protected because it was operating under a Schedule of Rates Contract.
Returning to the chronology, the second respondents, by their letter of 22 February recommended to the applicant that the first respondent be appointed to perform the works.
That recommendation was accepted. On 12 March 1985 the second respondents wrote to the first respondent in the following terms:-
"Our client, the Bond Corporation Pty Ltd., has instructed us to accept your tender for the works on a revised schedule giving a contract sum of $1,722,453.00 for a construction period of 21 weeks.
The contract start date is 13 March, 1985. Contract documents and schedule are being purchased and will be available shortly."
The first respondent commenced work on the site on 13 March 1985.
A formal instrument of agreement dated 21 May 1985 was executed by the applicant and the first respondent. Documents deemed to form and be read and construed as part of the agreement were listed:-
(a) General Conditions of Contract AS2124-81
(b) The Drawing Scheduled in the Tender Documents
(c) Specifications and Tender documents No. 3141, including Addendum No. 1.
(d) Letters from the second respondent dated 19 February 1985 and 12 March 1985 and 11 March 1985.
(e) First Respondent's tender dated 12 February 1985 and its later letters dated 20 February 1985 and 15 March 1985.
(f) The first respondent's telexes dated 20 February 1985 and 27 February 1985.
It is sufficient for present purposes to refer to clause 49.1 of the General Conditions which sets out a procedure for settlement of disputes. The clause provides inter alia, that, "all disputes or differences arising out of the Contract or concerning the performance or non-performance by either party of his obligations under the contract whether before or after the completion of the works shall be determined as follows".
The procedures then prescribed require notification of a dispute to the engineer designated as "Superintendent". Any party dissatisfied with the Superintendent's determination may give notice in writing to the other party requiring that "the matter at issue be referred to arbitration".
The clause then sets out steps to be taken to select an arbitrator and concludes:-
"(d) A reference to arbitration under this clause 49 shall be deemed to be a reference to arbitration within the meaning of the laws related to arbitration in force in the State or Territory named in the Annexure hereto and the arbitration proceedings shall be conducted in that State or Territory. The arbitrator shall have all the powers conferred by those laws and it shall be competent for him to enter upon the reference without any further or more formal submission than is contained in this clause. The arbitrator shall also have the power to award interest."
It is common ground that problems developed in the execution of the works.
According to the applicant's state property manager, Mr Bruce Buckley, there were extensive delays and practical completion was not achieved until 27 March 1986, some 30 weeks past the date specified under the contract.
Mr Jukes said in his affidavit that at the outset the scope of the works the first respondent was directed to perform was quite different from that on which it had tendered. Increases and changes ordered by the Superintendent resulted in the need to reprogramme the works so that they extended into the winter months.
The costs substantially exceeded the tender figure. The applicant says that to date it has paid the first respondent the sum of $2,774,573.00. The first respondent has an outstanding claim for $1,684,604.00.
On 16 June 1986 the first respondent notified the superintendent of a dispute pursuant to clause 49 of the General Conditions. Being dissatisfied with the superintendent's response, it referred the matter to arbitration on 12 September 1986. The notice of reference to arbitration described the matters in issue as:-
"(a) Payment of a reasonable sum or upon a quantum meruit for work (including variations) carried out by the contractor; and/or
(b) Payment pursuant to the contract for work (including variations) carried out by the contractor; and/or
(c) Payment of other moneys pursuant to the contract; and/or
(d) Damages; and
(e) Payment of interest
and the superintendent's rejection thereof."
Detailed particulars were contained in a five volume enclosure.
Interestingly the first respondent's letter to the applicant enclosing the notice and supporting material said:-
"The reference to arbitration is made without prejudice to our right to pursue our claims by means of litigation should we so decide."
Discussion ensued between representatives of the applicant and the first respondent in which the applicant evidently sought to persuade the first respondent that all matters in dispute should be resolved either by way of an arbitration to which the second respondents could be joined as a party, or in judicial proceedings in which the applicant would join the second respondents as a third party.
In the event the discussions floundered. On 24 November 1986 the applicant instituted these proceedings.
Against the first respondent the applicant pleads that at the time of submitting its tender to the second respondents in February 1985 it made various representations relating inter alia, to its management and procurement ability and experience, its knowledge of and experience in the relevant ground and weather conditions, its competence in relation to the planning and execution of the works with a minimum of interruption due to wet weather, the availability to it of plant and labour necessary to complete the works promptly and its capacity to carry out the works within the programmed term of 21 weeks.
These representations which it is said were made in trade or commerce to induce the applicant to engage the first respondent to carry out the works, are alleged by the applicant to have been untrue and to have caused it to suffer loss and damage.
A further representation attributed to the first respondent and said to be untrue was that it was capable of doing the work for its initial tender figure and the reduced figure of $1,722,453.00.
By this conduct also, the applicant was said to have suffered loss and damage.
The third area in which the first respondent is said to have been guilty of misrepresentation was in connection with the tender process. According to the statement of claim the first respondent and Leighton Contractors colluded in the preparation of artificially depressed tender figures representing an amount substantially less than that which they intended to charge for carrying out the works and substantially less than the price at which other suppliers of such services in Western Australia would offer to carry them out.
The first respondent and Leighton Contractors it was alleged, intended at the time the arrangement was made that by submitting such tender to the second respondents consideration would not be given to tenders submitted by other suppliers of such services because the prices offered by the first respondent and Leighton Contractors would be substantially less.
Mr Buckley who was cross examined by counsel for the first respondent was asked whether he was aware of any facts to support the allegation of collusive tendering in an exchange which proceeded as follows:-
Q. Mr Buckley, are you aware of any facts which support that allegation?
A. At present, Mr Davis, no, I do not, but I understand the process from here is a discovery of documents, right, which I would like to see take place.
Q. Are you aware of any fact which suggests that those documents would throw up any such facts?
A. I have no firm facts at this point in time.
Q. Are you aware of anyone else in your corporation who has any such facts in their possession?
A. Our corporation is investigating that at the moment.
Q. Are you aware of anyone else in your corporation which has such facts in his or her possession?
A. At the moment no."
Later in re-examination albeit of a leading character, he said that the applicant's belief as to the existence of a collusive tender was influenced by the size of the tenders submitted, the discrepancy between the lowest tenders and the rest of the field and the eventual actual cost of the project.
Following from the allegation of collusive tendering the statement of claim alleges that the first respondent by submitting its tender falsely represented:-
(a) That it was a tender arrived at independently of any other tender;
(b) That it was a realistic tender for the works;
(c) That it was a competitive tender for the carrying out of the works having regard to the nature and extent of the same.
By these false representations the applicant was again said to have suffered damage.
The three groups of misrepresentations alleged against the first respondent are said to constitute misleading and deceptive conduct on its part and are relied upon to support claims for damages under s.82 of the Trade Practices Act 1974. Although not expressly set out in the statement of claim, it is evident that the applicant seeks to characterise the conduct of the first respondent as contravening s.52 of the Act.
In addition the applicant alleges that the first respondent has breached various express and implied terms of the agreement in that it did not:-
(a) Exercise due care,skill and diligence in carrying out the works.
(b) Pursue completion of the words with all due expedition.
(c) Complete the works by 10 October 1985, the revised completion date fixed by Ove Arup.
(d) Give proper consideration to and take into account in the carrying out of the works the weather conditions likely to prevail during the time when the works were to be carried out.
(e) Adopt proper wet weather techniques.
(f) Make all proper enquiries as to the ground and weather conditions likely to prevail during the time when the works were to be carried out.
(g) protect the works from damage from rain and runoff.
(h) Ensure that sufficient plant and machinery was assigned to the works.
(i) Ensure that plant and labour assigned to the carrying out of the works was utilised to its maximum capacity.
(j) Co-operate with other contractors working on Brigadoon."
It is also contended that the first respondent was in breach of its common law duty to exercise reasonable care and skill in carrying out the works. Further, the statement of claim alleges in effect, that the first respondent fraudulently represented to the second respondent that it would be able to carry out the works for a price of $1,722,453.00.
As against the second respondents, the applicant alleges that they misrepresented their experience and expertise in design and supervision of land subdivisions, their ability to provide competent engineers with such experience, their ability to provide accurate estimates of subdivisional costs and their ability to provide accurate estimates of the costs of subdividing Brigadoon and of carrying out the works.
These representations it is said were made in trade and commerce were false and caused the applicant to suffer damage. The applicant claims that as a result of its reliance upon the second respondent's advice it is likely to have to pay more than $5.4m in excess of the estimated total cost of the subdivisional development.
Further it is alleged, the second respondent represented to the applicant that the work could be carried out for about $1,786,000.00. At the time of the representation it was said the second respondents did not have and could not have any reasonable expectation that the works could be carried out for that amount. The representation is said to have constituted misleading and deceptive conduct. Again, the applicant pleads that by reason of this advice it has suffered damage.
It was also contended against the second respondents that in breach of their contract with the applicant they failed to exercise reasonable care, skill and judgment in the performance of their duties as consulting and supervising engineers and in estimating the total cost to the applicant of subdividing the land. Extensive particulars of the alleged breach involving some 29 separate items are set out in the statement of claim.
It is also alleged the second respondents were in breach of their duty of care to the applicant in relation to the performance of their duties and the provision of cost estimates.
By way of relief the applicant claims against them damages pursuant to Part VI of the Trade Practices Act, damages for breach of contract and for negligence and a declaration that they are liable to indemnify the applicant in respect of any moneys which may be found due and owing to the first respondent.
Allegations of Bad Faith Against the Applicant
The first respondent contends as set out in the affidavit of its general manager, Mr B.J. Campain, that the applicant is not acting in good faith in instituting its proceedings against the first respondent in this court. According to Mr Campain the only purpose for which the applicant has commenced proceedings is to bring about a situation whereby the first respondent will, for reasons of economy and efficiency, chose to abandon its contractual right to arbitrate its claims against the applicant alone and pursue its claims by cross claiming in the proceedings, thereby enabling the applicant to seek an indemnity from the second respondents. He says that while that situation might well result in economies for the applicant, the fact remains that the first respondent would, in non consensual curial proceedings have to incur additional delays and costs and in effect be deprived of its contractual entitlement to have its disputes resolved in a one on one arbitration with the applicant.
In support of the allegation that the claim brought by the applicant against the first respondent is not genuine, extensive reference is made in the affidavit to negotiations and discussions and some correspondence between representatives of the applicant and the first respondent over the period from December 1986 to October 1986.
The first respondent points to the following elements of the applicant's conduct during this period being:-
1. Its acknowledgement during the period that the first respondent was not responsible for the problems being experienced on the works.
2. Its apparent acceptance that the second respondents were to blame for the problem.
3. Its reluctance to settle the first respondent's claims for fear of jeopardising its position as against the second respondent.
4. The desire on the part of the applicant to involve the first respondent as a party in any litigation with the second respondents.
5. The failure by the applicant to make any complaint of a breach of the Trade Practices Act by the first respondent until 10 October 1986.
6. The failure by the applicant to make any complaint of breach of contract, negligence or alleged fraud on the part of the first respondent until its letter of 14 November 1986 which enclosed a copy of a proposed statement of claim.
Counsel for the first respondent submitted that the applicant had instituted these proceedings against the first respondent for an improper purpose.
That purpose was, as counsel formulated it, to compel the first respondent to litigate in this court the contractual claim it has against the applicant contrary to its contractual entitlement to have the matter arbitrated.
The purpose is said to be improper as, it is alleged, the applicant has no reasonable expectation of succeeding in its claim for damages under the Trade Practices Act or otherwise.
In answer to these contentions, Mr Buckley in a supplementary affidavit, says that prior to the meeting held on 10 October 1986 the applicant was not in possession of any substantial information about dealings between the respondents.
Arising from discussions with representatives of the second respondents shortly before the meeting on 10 October, the applicant warned the first respondent that unless the dispute as a whole could be resolved in tripartite proceedings either by way of litigation or arbitration, then the applicant would bring an action under the Trade Practices Act 1974.
After the meeting, according to Buckley the applicant was provided by the second respondents with records of various communications, representations and transactions which had taken place before and after the contract was entered into.
Buckley says that the applicant has, in connection with these proceedings taken advice of two counsel including senior counsel who have settled the statement of claim.
The applicant admits that it would prefer to have the dispute between the parties resolved in one forum and by one method of dispute resolution and, said Buckley, he tried to persuade the respondents to such a course on a number of occasions.
Turning to the statement of claim filed by the applicant, it must be said there are some curious features about it.
Jukes' affidavit was not contradicted in its description of the first respondent as "a nationally prominent civil engineering construction company with annual turnover in excess of $200,000,000". The company has, it is said, operated in the construction industry for over 20 years.
Whatever the rights and wrongs of its execution of the Brigadoon works, it is indeed a dramatic allegation which contends in effect that the company has neither the management nor procurement capability nor the experience to undertake these subdivisional road and associated earthworks.
The first respondent's capacity to undertake the works is of course an issue that is logically distinct from its performance of the contract in this particular case.
Further, to make good its claim that the first respondent misrepresented its capacity to do the work for the sums of $2,169,250 and $1,722,453 respectively, the applicant faces the considerable difficulty that the first respondent was tendering on a Schedule of Rates Contract not on a lump sum basis.
It is in respect of this second group of representations that the applicant accuses the first respondent of fraud.
This is a serious accusation indeed. On the evidence before the Court at present there appears to be a complete answer to it on the part of the first respondent.
Whatever initial impressions may emerge from the papers however it is not appropriate that on conflicting evidence, largely on affidavit and not substantially tested by cross examination, I should draw any inference of mala fides on the part of the applicant.
Certainly the applicant desires to have all matters in dispute resolved.
If the applicant were manufacturing a sham dispute with the first respondent where none existed solely in order to get the first respondent into the court, then that would constitute an abuse of the process of the court.
In Packer v Meagher (1984) 3 NSWLR 486 it was held that an action will be an abuse of process when a plaintiff uses the process of the court to effect an object not within the scope of the process or for a purpose other than that for which the action is properly designed or to serve some collateral advantage beyond what the law allows.
To find in this case an abuse of process it would be necessary first to conclude that the applicant's claim against the first respondent is without merit. That is not to say that every case of abuse of process arising from an improper purposes would require such a finding.
In my opinion, while the claim against the first respondent, on the material presently before the court, has a number of obstacles in its way, it is not possible to say that it will not succeed in the end.
A fortiori it is not possible to say that the applicant is careless of the outcome of the proceedings as against the first respondent.
To find that there is bad faith on the part of the applicant is to make a finding seriously adverse to its credibility. It is not a finding to be made on conflicting affidavits essentially untested by cross-examination. The evidence of Mr Buckley under cross examination does not support an inference of bad faith.
In my opinion, the evidence presently before me does not support the allegation of bad faith against the applicant in connection with the institution or conduct of these proceedings.
The Proceedings to Date
The applicant has filed its statement of claim and the respondents have entered appearances. That entered by the second respondents is stated to be conditional.
No defences have been filed to date.
Pursuant to clause 49 of the General Conditions the President of the Institute of Arbitrators has, at the request of the first respondent, nominated Mr William Brown to act as arbitrator. By a letter dated 5 December 1986 Mr Brown gave notice to the applicant and the first respondent that he intended to call a preliminary conference in the arbitration on Friday, 19 December 1986 in Melbourne.
Pending the hearing of the motions presently before the court, the first respondent has taken no further steps in the arbitration and the date set down for the preliminary conference has been vacated.
The applicant's motion seeks an order that the first respondent, its servants or agents, be restrained until further order from prosecuting the arbitration between the respondents and the applicant in accordance with the notice of reference to arbitration served by the respondents on 12 September 1986.
The first respondent moves for orders in the following terms:-
1. That the claim made by the application and statement of claim against the first respondent herein be stayed until the determination by arbitration of the issues between the applicant and the first respondent.
2. Alternatively, that the claim against the first respondent be stayed or dismissed generally on the grounds that:-
(i) no reasonable cause of action is disclosed by the statement of claim against the first respondent;
(ii) the proceeding against the first respondent is frivolous or vexatious;
(iii) the proceeding against the first respondent is an abuse of the process of the court.
Source of the Power to Stay Proceedings in the Federal Court
The court has a general power to control its own proceedings and that power extends to enable it to order a stay of proceedings - Hughes Motor Service Pty Ltd v Wang Computer Pty Ltd (1978) 35 FLR 346,351 per Bowen CJ; Muller v Fencott (1981) 53 FLR 184, 189 per Toohey J.
In the circumstances of this case however, consideration must be given to another source of power to stay these proceedings.
In Western Australia the arbitration process is regulated by the Commercial Arbitration Act 1985,
The Act came into operation in 1986 and replaced the Arbitration Act 1895.
By sub-s.3(2) it is expressed to apply to arbitration agreements whether made before or after the commencement of the Act.
An "arbitration agreement" is defined by s.4 as an agreement in writing to refer present or future disputes to arbitration.
Clause 49 of the General Conditions AS2124-1981 brings the agreement between the applicant and the first respondent into that category.
The Supreme Court of Western Australia designated as "the Court" is, under that designation, given certain powers with respect to arbitrations including jurisdiction to hear appeals on questions of law arising out of an award.
Section 53 of the Act however refers to courts generally and is not limited to the Supreme Court in providing as follows:-
"53(1) If a party to an arbitration agreement commences proceedings in a court against another party to the arbitration agreement in respect of a matter agreed to be referred to arbitration by the agreement, that other party may, subject to sub-section (2) apply to that court to stay the proceedings and that court, if satisfied -
(a) that there is no sufficient reason why the matter should not be referred to arbitration in accordance with the agreement; and
(b) that the applicant was at the time when proceedings were commenced and still remains ready and willing to do all things necessary for the proper conduct of the arbitration,
may make an order staying the proceedings and may further give such directions with respect to the future conduct of the arbitration as it thinks fit.
(2) An application under subsection (1) shall not, except with the leave of the court in which the proceedings have been commenced, be made after the applicant has delivered pleadings or taken any other step in the proceedings other than the entry of an appearance.
(3) Notwithstanding any rule of law to the contrary, a party to an arbitration agreement shall not be entitled to recover damages in any court from another party to the agreement by reason that that other party takes proceedings in a court in respect of the matter agreed to be referred to arbitration by the arbitration agreement."
The question arises whether the provision applies in relation to proceedings instituted in the Federal Court where such proceedings are in respect of a matter agreed to be referred to arbitration by an arbitration agreement.
It is unlikely as counsel for the first respondent seemed to suggest, that the State law is a direct source of power for the federal court.
It is the Parliament of the Commonwealth which is given by s.77 of the Constitution, legislative power to define the jurisdiction of federal courts.
The powers with which such courts are equipped in aid of the exercise of their jurisdictions are conferred by the Parliament of the Commonwealth as an incident of the express legislative authority given to it by s.77 of the Constitution.
In John Robertson & Co. Limited v Ferguson Transformers Pty Ltd (1973) 129 CLR 65, Menzies, Gibbs and Mason JJ expressed the view that s.37 of the Limitation of Actions Act 1936 (S.A.) did not apply directly to an action commenced in the South Australian Registry of the High Court.
Gibbs J. at 87 said:-
"It was conceded by the defendant that this section cannot of its own force apply to bar the present action. That concession was in my opinion, correct. The legislature of South Australia has no constitutional power to prescribe a limit of time within which proceedings may be brought in this Court or in any other federal court, and a statute of limitations enacted by that legislature must be construed as applicable only to proceedings in courts subject to the legislative power of South Australia: Pedersen v Young (1964) 110 CLR 162 at pp.165, 167."
At 93 Mason J. said:-
"I am unable to perceive any basis on which the Parliament of South Australia could validly prescribe a rule of procedure to be applied directly in actions in the High Court. That topic, so it seems to me, is one which falls within the legislative power of the Commonwealth Parliament ((see Pedersen v Young per Menzies J. (1964) 110 CLR 162, at p.167)."
It is not necessary in this case however to consider further the propounded direct application of s.53 of the Commercial Arbitration Act 1985 to this court.
For s.79 of the Judiciary Act 1903 provides:-
"The laws of each State or Territory including the laws relating to procedure, evidence and the competency of witnesses, shall, except as otherwise provided by the Constitution or laws of the Commonwealth, be binding on all courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable."
The operation of s.79 in relation to a state law empowering state courts to stay their proceedings pending the determination of an arbitration was referred to in Lady Carrington Steam Ship Co. Ltd v The Commonwealth (1921) 29 CLR 596.
There the plaintiff had instituted proceedings in the original jurisdiction of the High Court to recover compensation in respect of the requisitioning of its ship under the War Precautions (Shipping) Regulations 1918.
The Commonwealth applied for a stay of proceedings in the action under s.6 of the Arbitration Act 1902 (NSW) alleging that the parties had made a "submission" of the matter to arbitration.
The court (Knox CJ, Higgins and Starke JJ) would have refused a stay on the basis that the proceedings could involve the determination of more than one point of law including a constitutional question.
Their Honours expressly declined to state any view on whether s.79 of the Judiciary Act empowered the court to grant a stay under the provisions of the Arbitration Act although Knox CJ at 599 said of the question that it "...may be a point of some difficulty".
Huddart Parker Ltd v The Ship Mill Hill (1950) 81 CLR 502 involved proceedings instituted in the Admiralty Jurisdiction of the High Court.
Two suits were commenced against the Ship Mill Hill and her cargo for compensation for salvage services.
Application was made by summons for a stay of the proceedings on the basis that certain provisions of an agreement between the ship's agent and the plaintiffs constituted a submission to arbitration.
Dixon J. (as he then was) dismissed the two summons' for a stay but in doing so held that the court had the power under s.5 of the Arbitration Act 1928 (Vic) to stay the proceedings.
At 507 he said:-
"There is no express statutory power conferred upon this Court to stay, on such a ground, proceedings otherwise properly brought in its original jurisdiction. It is not a power that can arise otherwise than from statute. Section 79 provides that the laws of each State, including the laws relating to procedure, evidence and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all courts exercising federal jurisdiction in that State in all cases to which they are applicable. This section is based on a provision of the law of the United States which has a long and controversial history, originating as it does in the thirty-fourth section of the Judiciary Act of
1789. See for example Camden & Suburban Railway Co. v Stetsen (1900) 177 US 172. But section 79 is more widely expressed than the American provision and I think that it should be interpreted and applied liberally. Notwithstanding the doubts expressed in Lady Carrington Steam Ship Co. Ltd v Commonwealth (1921) 29 CLR 596, I should be prepared to regard such a provision as section 5 of the Victorian Arbitration Act 1928, corresponding to section 4 of the Arbitration Act 1889 of the United Kingdom, as made applicable to the High Court exercising its federal jurisdiction. cf. Cohen v Cohen (1929) 42 CLR 91, at p.99 and Musgrave v Commonwealth (1937) 57 CLR 514 at pp.531-532, 543, 547, 548, 551."
The application of s.79 of the Judiciary Act has been considered in a number of decisions of the High Court and this court. I have been unable to find any other than that cited above which related to powers under state law to stay proceedings pending the determination of an arbitration.
Section 79 picks up state laws which, in their terms, apply to courts generally even though they are, as a matter of construction, directly applicable to state courts only.
In John Robertson & Co. Limited v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 95 Mason J. (as he then was) said:-
"To ensure that State laws dealing with the particular topics mentioned in the section are applied in the exercise of federal jurisdiction by courts other than State courts, it is necessary that State laws be applied according to the hypothesis that federal courts do not necessarily lie outside their field of application. Section 79 requires the assumption to be made that federal courts lie within the field of application of State laws on the topics to which it refers, at least in those cases in which the State laws are expressed to apply to courts generally."
Menzies J. at 80-81 agreed with the exposition of s.79 advanced by Mason J. A like view was expressed by Gibbs J. at 88-89.
Problems may arise in the case of State laws which refer explicitly to a particular state court - Australian National Airlines Commission v Commonwealth of Australia and Canadian Pacific Airlines Ltd (1975) 6 ALR 433 at 435 per Mason J.
This case however is not a case in which the relevant state law is applied to a designated state court.
In that sense it is analogous to the case before Pincus J. in Neilsen v Hempston Holdings Pty Ltd (1984) 65 ALR 302 where the question arose as to the applicability in proceedings in this court of s.72 of the Common Law Practice Act (Qld) empowering Courts of Record in Queensland to award interest in judgments for debt or damages.
Pincus J. at 311 said inter alia:-
"The expression " a court of record" in the Queensland section means a Queensland Court of Record, but that does not prevent section 79 of the Judiciary Act from making it applicable in cases in this court. State statutes picked up by section 79, especially those relating to "procedure, evidence and the competency of witnesses", must be drawn so as to apply to State courts only and when section 79 makes such statutes binding on "all courts exercising federal jurisdiction in that State.....". It must mean to make them binding as if they were referred to in the latter category of courts.
.
.
.
Here the state statute applies to Courts of Record generally and not merely to a particular named State Court; the problem referred to by Mason J. in Australian National Airlines Commission v Commonwealth of Australia
(1975) 6 ALR 433 at 435-6 therefore does not arise."
Section 53 of the Commercial Arbitration Act 1985 applies to courts generally although as a matter of construction it would be limited in its direct application to Western Australian courts.
Section 53 of the Commercial Arbitration Act in my opinion is therefore picked up by s.79 and made applicable to the proceedings now before the court.
Application of Section 53 to the Present Proceedings
Given that s.53 of the Commercial Arbitration Act is capable of application by virtue of s.79 of the Judiciary Act to proceedings in this court, the question then arises whether it does apply to these proceedings.
As already pointed out, the agreement between the applicant and the first respondent is, by virtue of clause 49 of the General Conditions AS2124-1981 an "arbitration agreement" within the meaning of that term as defined in s.4 of the Commercial Arbitration Act.
It has also been already pointed out that the proceedings instituted in this court are proceedings in respect of a matter agreed to be referred to arbitration by the arbitration agreement between the parties within the meaning of sub-s.53(1).
The first respondent has, as required by sub-s.53(2) not delivered pleadings or taken any step in the proceedings other than the entry of an appearance. I would not consider the alternative claims in the first respondent's motion by which it seeks summary stay or dismissal of the action as a step in the proceedings prior to its application for a stay pending the determination of the arbitration.
Even if the filing of the motion including this claim for alternative relief, could be treated as such a step for the purposes of sub-s.53(2), I would not hesitate if it were necessary, to grant leave to enable the applicant to apply for the stay. - See - Reliable Roof Treatments Pty Ltd v Citra Constructions Pty Ltd (1974) 1 NSWLR 285, 289.
There remain two conditions upon which the availability of the power depends and these are as set out in paragraphs (a) and (b) of sub-s.53(1).
As to the second of these conditions there is no dispute that the first respondent was at the time that this action was commenced, and still remains ready and willing to do all things necessary for the proper conduct of the arbitration.
The remaining question is whether there is any sufficient reason why the matter should not be referred to arbitration pursuant to the agreement.
While the language of paragraph (a) of sub-s.53(1) might be thought to place a burden on the party moving for a stay to establish that there is no sufficient reason for the matter not to go to arbitration, such a construction would be inconsistent with decisions on similar provisions in other state acts.
In Huddart Parker Limited v The Ship Mill Hill (supra) Dixon J. speaking of s.5 of the Arbitration Act 1928 (Vic) said at 508:-
"Under the statutory power expressed in section 5 of the Arbitration Act 1928 (Vict.) the court or the judge, assuming that the other necessary conditions are fulfilled, must be satisfied that there is no sufficient reason why the matter should not be referred in accordance with the submission. This language might appear to place the burden upon the defendant applying for a stay. But the courts begin with the fact that there is a special contract between the parties to refer and therefore in the language of Lord Moulton in Bristol Corporation v John Aird & Co. (1913) AC 241 at p.259, consider the circumstances of a case with a strong bias in favour of maintaining the special bargain or as Scrutten LJ said in Metropolitan Tunnel and Public Works Ltd v London Electrical Railway (1926) Ch.371 at p.389, "a guiding principle on one side and a very natural and proper one, is that parties who have made a contract should keep it". At the same time, as is shown by the two cases cited, the Court's discretion has not been restricted by any exclusive definition of the circumstances which will warrant a refusal of a stay; see per Lord Parker in Aird's case (1913) AC at p.260 and per Scrutten LJ in the Metropolitan Tunnel case
(1926) Ch. at pp 389, 390."
This approach was followed by the Victorian Full Court in G.W.J. Blackman & Co. S.A. v Oliver Davey Glass Co. Pty Ltd (1966) VR 570 at 574 where in a joint judgment of Winneke CJ, Adam and Gillard JJ it was said:-
"In form the section throws upon the party to a submission, who desires that the agreement for a submission should be enforced, the burden of satisfying the court that there is no sufficient reason why the matter should not be referred in accordance with the submission. But in applying this section the courts have consistently acted on the view that the parties should be kept to their bargain unless strong reasons are shown why an action commenced in defiance of the agreement for a submission should be allowed to continue. In substance it is the party who is resisting the application for a stay who has the burden of satisfying the court that there are strong grounds for refusing to allow the dispute to be determined in accordance with the submission."
That view was reaffirmed by the Victorian Full Court more recently in W.C. Thomas & Sons Pty Ltd v Bunge (Australia) Pty Ltd (1975) VR 801 at 805.
Insofar as the motion for a stay relies upon the power of the court to regulate its own proceedings, there is no reason to suppose that that power is cut down by the existence of s.53 and its application to the court by virtue of s.79 of the Judiciary Act 1903.
Nevertheless, given that s.53 of the Commercial Arbitration Act 1985 applies to the case and that there is a line of authority establishing principles for its application, those principles may as a matter of discretion, be applied in the exercise of the power more directly conferred on the court.
The claims made by the applicant against the first respondent are concerned to a substantial extent with the performance by it of its contract with the applicant.
That is not to say that the precontractual representations alleged do not form a significant part of the application as pleaded.
However insofar as it relates to the performance of the terms of the contract by the first respondent,the application relates to disputes or differences which arise out of the contract or concern the performance or non-performance by either party of his obligations under the contract.
To that extent therefore, the matters raised by these proceedings as against the first respondent are within the scope of clause 49 of the General Conditions and, subject to the court's overriding discretion, the first respondent is entitled to have them dealt with by arbitration.
The discretion to order a stay of judicial proceedings in favour of arbitration must be exercised according to the circumstances of each case.
There are nevertheless certain general considerations which emerge from decided cases in this regard.
The fact that a dispute raises questions of law of some difficulty or complexity is a consideration which may weigh against the grant of a stay. - Lady Carrington Steam Ship Co. Ltd v The Commonwealth (1921) 29 CLR 596, Halifax Overseas Freighters Ltd v Rasno Export ("The Pine Hill") (1958) 2 Lloyds Rep. 146,151; Dillingham Construction Pty Ltd v Downes (1969) 90 WN (Part 1) (NSW) 258; O'Neill & Clayton Pty Ltd v Ellis & Clarke Pty Ltd (1978) 20 SASR 132.
In The Eschercheim (1974) 3 All ER 307 on the other hand, Brandon J. attached only small importance to the argument that difficult questions of law or of mixed fact and law would be involved in a proposed arbitration.
The desirability of avoiding a multiplicity of proceedings and the possibility of inconsistent findings of fact by different tribunals is also a matter that weighs in the balance against the grant of a stay. - The Pine Hill (supra) at 151; Taunton-Collins v Cromie (1964) 2 All ER. 332, 333, 334; Tasmanian Pulp and Forest Holdings Ltd v Woodhall Ltd (1971) Tas. SR 330, 345-348.
The last mentioned case had some similarities to the present in that the plaintiff sued its engineers, its builders and the installers of certain equipment in connection with the construction of a wood chip mill.
There was a possiblity of separate arbitrations between the plaintiff and different parties if a stay were to be granted.
Neasey J. with whom Burbury CJ agreed observed at 346:-
"It is true there are a number of grave issues raised by the pleadings against the engineers which are not raised against the respondent; concerned primarily with the advice given the appellent by the engineers, and designing done by the engineers. It would seem to me, prima facie, that the resolution of those issues is likely to be closely connected with resolution of the issues common to both the engineers and the respondent. That is to say, once responsibility is determined as between the engineers and the respondent for that which went wrong with the construction and operation of the mill (if and in so far as things did go wrong and either party was responsible), resolution of the issues which lie solely between the appellant and the engineers will probably at least be materially effected.
These considerations, together with others which I regard in the context as being relatively minor, and do not explore in detail (such as procedural advantages - rights of discovery and the like - which the trial process possesses over separate arbitrations in a case like this) would have been, to my mind, clearly sufficient in the whole context to outweigh the strong bias in favour of arbitration which the parties agreement sets up."
It can be said that in the present case as in that case, the resolution of issues between the applicant and the second respondents is closely connected with the resolution of issues common to both first and second respondents.
There have been cases involving chains of contracts, only one of which contained an arbitration clause and where third and sometimes fourth and fifth party proceedings were involved.
Courts have nevertheless been prepared to stay proceedings as between those parties whose contract provided for reference of their dispute to arbitration - Reid v Ericsson (1938) VLR 90; W. Bruce Ltd v J. Strong (1951) 2 KB 447.
In G.W.J. Blackman & Co. S.A. v Oliver Davey Glass Co. Pty Ltd (1966) VR 570 at 581 the Victorian Full Court said:-
"...It seems that the courts have not felt constrained to attribute much weight to the mere circumstance that a party to a submission has been made a defendant to litigation instituted by others as a ground for refusing a stay of third party proceedings which are covered by the submission."
- See also W.C. Thomas & Sons Pty Ltd v Bunge
(Australia) Pty Ltd (1975) VR 801.
However in Tasmanian Pulp & Forest Holdings Ltd v Woodhall Limited (supra) Neasey J at 348 drew a distinction between the chain of contract case and the case in which the plaintiff sues several parties all as co-defendants in the one action and where many issues of fact are common to them all.
That with respect, is a distinction which I accept as relevant for the purposes of the exercise of this discretion.
Further, the present case is one which falls into the latter category.
Whether a Stay Should Be Granted in the Present Case
In my opinion there is a probability that the arbitration proceedings between the first respondent and the applicant will raise some questions of law which are not necessarily straight forward, particularly as to whether the first respondent is in the circumstances, entitled to be paid on a quantum meruit basis and as to whether the contract was frustrated.
More importantly the arbitration will raise issues between the first respondent and the applicant which are closely related, if not common, to the issues raised between the applicant and the second respondents.
There is a possibility that inconsistent findings of fact may emerge from the arbitration and from the proceedings in this court.
There are issues of law raised in the proceedings in this court which are closely related to some of the questions that may arise in the arbitration and which cannot be resolved by the arbitrator.
The question whether the first respondent has contravened s.52 of the Trade Practices Act 1974 is related to its performance of the contract which will, it seems, be relied upon by the applicant to falsify certain of the representations attributed to it.
That is not to make any comment about the strength of the applicant's case against the first respondent. As I have already indicated, it is plainly not without difficulty.
In the end however I am of the view that in order to avoid a multiplicity of proceedings, the possibility of inconsistent findings and to enable the proper resolution of questions of law which may arise, the first respondent's motion for a stay of the proceedings pending the determination of the arbitration hearing should be refused.
Proposed Restraint on First Respondent In Arbitration Proceedings
The applicant seeks an order restraining the first respondent until further order from prosecuting the arbitration proceedings which it has instituted.
The threshold question is whether or not the Court has power to make such an order.
The substantive application as against the first respondent relies upon causes of action said to arise under s.82 of the Trade Practices Act. In such matters the court has exclusive jurisdiction by reason of s.86 of that Act.
The controversy between the applicant and the first respondent in my opinion, embodies the applicant's claims in tort and contract which the Court may adjudicate upon in the exercise of its accrued jurisdiction - Fencott v Muller (1983) 152 CLR 570.
The first respondent's claim against the applicant which it has referred to arbitration is also in my opinion, a part of the same controversy. The kind of assessment involved in arriving at that conclusion is not susceptible of nice analysis but remains as was said in Fencott v Muller (supra), a matter of impression and practical judgment.
That being so, the first respondent's claim against the applicant also falls within the accrued jurisdiction of this court.
Given that this court has jurisdiction in the relevant area, it would have the power under s.23 of the Federal Court of Australia Act to restrain the first respondent from proceeding to pursue a claim for further payments in the Supreme Court of the State pending the determination of the litigation in this court - St. Justins Properties Pty Ltd v Rule Holdings Pty Ltd (1980) 40 FLR 282. A fortiori the Court has power to restrain the first respondent from proceeding with its claim in the arbitration pending the resolution of the present litigation.
I can see no reason why the principles applicable to an application to restrain a party to proceedings in this court from taking steps in proceedings in a state court are not appropriate where it is sought to restrain a party from taking steps in an arbitration pending the outcome of litigation in this court.
The relevant principles are set out in the judgment of Gibbs CJ and the joint judgment of Mason, Brennan and Deane JJ in Stack v Coast Securities (No. 9) Pty Ltd (1983) 154 CLR 261, 285 and 298.
It is perhaps sufficient to set out the relevant passage from the joint judgment at 298:-
"The first and paramount consideration in the exercise of this discretion is to do what is best in the interests of the litigants. In this respect the Federal Court can resolve the entire controversy; the Supreme Court cannot do so because the second limb of section 86 of the Act stands in its way. The court which can resolve the entire controversy has an obvious advantage. Generally speaking, its determination of all the issues will be made more effectively and more expeditiously and at less expense than the resolution of the controversy which depends on determinations made by two courts in separate proceedings in which the issues are necessarily fragmented.
To offset this advantage offered by the Federal Court powerful countervailing reasons need to be shown. For example, it may appear that the federal issue is raised at such a late stage in the Supreme Court proceedings that it would be a waste of time and lead to needless expense and inconvenience not to proceed to a hearing in that Court. Or it may appear that the federal issue is so insubstantial or removed from the non-federal issues that the Supreme Court should proceed with the determination of those issues. It may even appear that the federal issue is but one of many issues making up the entire controversy and that it is indistinquishable from one of the non-federal issues in the sense that the resolution of one necessarily leads to a resolution of the other. In such a case there will be stronger ground for allowing the action to proceed in the Supreme Court."
It is relevant in the present case to have regard to the following factors:-
1. The arbitration proceedings have not gone beyond the point of the initial notice and appointment of arbitrator.
2. There is no real prejudice demonstrated by the first respondent were it to prosecute its claim as a cross claim in this court.
3. All disputes between all parties can be resolved in these proceedings.
4. There are overlapping issues as between the proceedings in this court and the dispute referred to arbitration which would lead to inconsistent findings of fact and law as between the two tribunals.
5. This is not a case in which the resolution of the arbitration proceedings would lead to a resolution of issues in this litigation.
It is of course, a relevant distinction to make that proceedings instituted by one party in a State Supreme Court are non-consensual in character whereas the availability of arbitration arises from the parties agreement to resolve their disputes in that manner.
However in my opinion, that consensual element cannot play any significant role at this point having regard to the decision already taken not to order a stay of the proceedings in the Federal Court pending the determination of the arbitration.
It must be accepted that the first respondent cannot be compelled to bring into this court by way of cross claim, the claim against the applicant that it has referred to arbitration. Whether it chooses to do so or not, is a matter for it.
Nevertheless general principle and the facts of this particular case including the desirability of avoiding inconsistent findings on questions of law or fact warrant an order restraining the first respondent from proceeding with its claim in the arbitration until further order.
The continuance of the restraint so ordered will be reviewable in the light of the progress made by the applicant in prosecuting these proceedings. Should it emerge that the applicant does not prosecute the proceedings in this court with all due diligence and speed, then it will be open to the first respondent to apply to set aside the restraint order and continue with its arbitration.
The First Respondent's Motion to Stay or Dismiss the Proceedings
The first respondent seeks an order that the claim against it be stayed or dismissed generally on the grounds that:-
(i) No reasonable cause of action is disclosed by the statement of claim against the first respondent.
(ii) The proceeding against the first respondent is frivolous or vexatious.
(iii)The proceeding against the first respondent is an abuse of the process of the court.
This motion invokes O.20 r.2 of the Federal Court Rules and attacks the application in its entirety. It will not support an attack on parts of the statement of claim alleged to be defectively pleaded or inadequately particularised .
Such an attack may be brought under O.11 r.16 with the object of striking out the whole or any part of the impugned pleading.
In support of the first two grounds specified in the motion, counsel for the first respondent made criticisms of particular parts of the statement of claim relating to his client. These criticisms were made in support of what he described as the "basic submission that this document is so shot through with difficulties that it is vexatious".
I do not propose to deal with these items on a point by point basis.
It may be that there are parts of the statement of claim that are deficient and that such deficiencies may even support a motion to strike out part of the pleadings.
I am not satisfied however that the first respondent has made out a case to stay or dismiss the entire claim against it.
In coming to that conclusion I bear in mind the well established principles regulating applications for summary disposal of proceedings as enunciated in Dey v Victorian Railways Commissioners (1949) 78 CLR 62 and General Steel Industries Inc. v Commissioner for Railways (NSW) (1964) 112 CLR 125, 129 and the many cases which have followed them.
As to the third ground in which the first respondent contends that the proceeding is an abuse of the process of the court, I have already indicated that in my view the evidence does not allow me to reach that conclusion.
CONCLUSION
In the result I will accede to the applicant's motion and dismiss the first respondent's motion.
16
0