Bride v The Australian Bank Ltd

[1999] WASC 110

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   BRIDE & ANOR -v- THE AUSTRALIAN BANK LTD & ORS [1999] WASC 110

CORAM:   MASTER BREDMEYER

HEARD:   16 JULY 1999

DELIVERED          :   30 JULY 1999

FILE NO/S:   CIV 1570 of 1989

BETWEEN:   EDWARD JAMES BRIDE

WENDY MARGARET BRIDE as TRUSTEES OF THE PINWERNYING FAMILY TRUST
Plaintiffs

AND

THE AUSTRALIAN BANK LTD
First Defendant

SOUTHERN ROLLED OATS PTY LTD (formerly SOUTHERN FOODS (1986) PTY LTD)
Second Defendant

MILNE FEEDS PTY LTD

Third Defendant

FILE NO/S              :CIV 1804 of 1989

BETWEEN              :EDWARD JAMES BRIDE

WENDY MARGARET BRIDE as TRUSTEES OF THE PINWERNYING FAMILY TRUST
Plaintiffs

AND

PEAT MARWICK MITCHELL
Defendant

Catchwords:

Practice - Trial of preliminary issues - Application to join a new party

Legislation:

Nil

Result:

Application allowed in part

Representation:

CIV 1570 of 1989

Counsel:

Plaintiffs:     In person

First Defendant             :     Ms C H Thompson

Second Defendant         :     Ms C H Thompson

Third Defendant           :     No appearance

Solicitors:

Plaintiffs:     In person

First Defendant             :     Freehill Hollingdale & Page

Second Defendant         :     Freehill Hollingdale & Page

Third Defendant           :     No appearance

CIV 1804 of 1989

Counsel:

Plaintiffs:     In person

Defendant:     Ms C H Thompson

Solicitors:

Plaintiffs:     In person

Defendant:     Freehill Hollingdale & Page

Case(s) referred to in judgment(s):

Bride & Anor as Trustees for the Pinwernying Family Trust v The Australian Bank Ltd, Southern Rolled Oats Pty Ltd & Milne Feeds Pty Ltd, unreported; FCt SCt of WA; Library No 950632; 21 November 1995

Bride v Milne Feeds Pty Ltd & Anor, unreported; FCt SCt of WA; Library No 950622; 21 November 1995

Bride v Milne Feeds Pty Ltd & Anor, unreported; FCt SCt of WA; Library No 970060; 21 February 1997

Milne Feeds Pty Ltd v Bride & Ors (1993) 10 WAR 542

Case(s) also cited:

Nil

1. MASTER BREDMEYER:  The plaintiffs have applied in both these actions for the following orders:

   1.      Australian Quality Ingredients Pty Ltd, of 2 Creek Street Katanning, in the State of Western Australia, be joined as a party to this action and thereafter be referred to as, The Fourth Defendant.

   2.      That the Plaintiffs be given leave to amend The List of Papers for the Judge, dated 14th May 1997 to Plead the causes of action the Plaintiffs now have against Australian Quality Ingredients Pty Ltd.

   3.      That all the matters relating to the validity of the appointment of Receivers Managers by the First Defendant on 9th August 1984 be tried and determined as a "Preliminary Issue".  Such matters to be:

   a.      Whether the First Defendant on the 8th August 1984 made proper and lawful "Demand" for money's said to be due and owed to the First Defendant by the Plaintiffs.

   b.      Whether the Receivers Managers, on the 9th August 1984 were validly and legally appointed pursuant to the First Defendants "Security Documents" and specifically Mortgages C646218 and C337514.

   c.      Whether the Receivers Managers and the First Defendants knew and were aware that "At Law" the Receivers Managers were in Fact and Law in Trespass of the Plaintiffs land on a from the 9th August 1984.

   d.      Whether as a consequence thereof the actions, conduct and Receivership of the Plaintiffs, Land, Business and Assets was AT LAW:

   (1)     Fraudulent with intent to "Defraud and Mislead" the Plaintiffs and the unsecured creditors thereof.  As a consequence thereof:

   (2)     Void Ab Inito, Void at First Instance.  As a consequence thereof:

   (3)     A Nullity.

   4.      That the determination of the "Preliminary Issues" be heard before A Judge in Chambers, for 3 days by way of an expedited hearing.

   5.      That the parties hereto be given leave to subpoena witnesses, both local and interstate to:

   a.      Prove the evidence relating to the appointment of Receivers Managers, and the legal question of "Demand".

   b.      Give sworn testimony on the evidence.  (Supra)

   6.      The costs of this Application be the Plaintiffs in any event.

   7.      Any other orders that This Honourable Court deems fit.

2. In relation to the first two paragraphs of the chambers summons, seeking to join Australian Quality Ingredients Pty Ltd as a fourth defendant in CIV 1570 of 1989, I propose to dismiss this application.  The plaintiffs are at liberty to re‑apply but I direct that that application be served on the proposed new defendant.  Normally a plaintiff has a right to join a new defendant if that is necessary to ensure that all matters in dispute may be effectually and completely determined, but the material before me at present is insufficient in that regard.  By a written notice dated 8 May 1996 Mr Bride gave notice to the directors of Australian Quality Ingredients Pty Ltd of the alleged defects in the title of Southern Rolled Oats Pty Ltd to the property at Katanning and warned them that they held the property on constructive trust for the rightful owners, the plaintiffs.

3. I have directed that notice of this be given to the proposed new defendant as that company may wish to argue against the joinder, that the plaintiffs have no possible cause of action against it.  The following decisions may be relevant: Milne Feeds Pty Ltd v Bride & Ors (1993) 10 WAR 542, a decision of Malcolm CJ affirmed on appeal in Bride v Milne Feeds Pty Ltd & Anor, unreported; FCt SCt of WA; Library No 950622; 21 November 1995; Bride & Anor as Trustees for the Pinwernying Family Trust v The Australian Bank Ltd, Southern Rolled Oats Pty Ltd & Milne Feeds Pty Ltd, unreported; FCt SCt of WA; Library No 950632; 21 November 1995, and Bride v Milne Feeds Pty Ltd & Anor, unreported; FCt SCt of WA; Library No 970060; 21 February 1997.

4. I turn now to the application for a trial of preliminary issues in these two actions.  I note that, although the defendants are different, the statement of claim in each action is practically identical.  I am told by Mr Bride that an order has been made by the Court that the evidence in one is to be used as evidence in the other.  I have not sighted that order but can see the sense of it.  I note further that on 5 May 1997 in action CIV 1570 of 1989 Master Sanderson made a number of orders in that action and I quote the relevant ones:

   "4.All issues of liability and quantification other than any liability of the third defendant to the plaintiffs and the quantification thereof be tried as a preliminary issue.

   5.The plaintiffs have the carriage of the preliminary issue.

   6.The preliminary issue be tried by a Judge in court.

   7.The parties have liberty to apply."

   On the basis of those orders, the solicitors for the third defendant (Milne Feeds Pty Ltd) advised that he would not attend the hearing of this application.

5. In his affidavit in support of the application Mr Bride says that the trial of the preliminary issue pursuant to the order of Master Sanderson has been set down for six weeks and that the trial of the preliminary issues which he seeks in this application will be heard in two or three days thus saving the parties and the Court huge costs.

6. I note that the trial of preliminary issue ordered by Master Sanderson on 5 May 1997 will not save the parties or the Court much time.  Milne Feeds Pty Ltd is very much a minor party in the pleaded dispute.  The statement of claim in the papers for the Judge in action CIV 1570 of 1989 runs to 28 pages of which less than one page is devoted to pleading the case against the third defendant.  I note that it was the third defendant which applied for the trial of preliminary issues which was granted by Sanderson M.  The "misdeeds" of the defendants, of which Mr Bride complains, largely took place in 1984 and most of the pleading concerns the legality or otherwise of those actions.  The third defendant purchased the business from the second defendant in November 1988 and the plea against it is brief that Mr Bride gave notice to the third defendant prior to its purchase of his complaints about the second defendant's title.  The third defendant went ahead with the purchase nevertheless and it is pleaded that the third defendant holds the property as constructive trustee for the plaintiffs.  My point is that the current trial of preliminary issues represents very little saving in Court hearing time and in costs. 

7. The plaintiffs proposal for a trial of preliminary issues in both actions - I am considering it here is broad outline - represents substantial savings in Court time and in costs to the parties.  It concentrates on the alleged illegality of various steps taken by The Australian Bank and Peat Marwick Mitchell in taking over the plaintiffs' assets and in selling them.  The relevant evidence on those issues is largely documentary and I suspect that those documents are not in dispute or not much in dispute.  The disputes are over the legal effects of those documents and that is a matter for argument.  If the plaintiffs are successful in proving some of the allegations, for example that the receivers and managers were appointed invalidly, then that could determine the action in favour of the plaintiffs.  I consider that a trial of preliminary issues is well justified and should be granted.  However, I do not propose to accept the plaintiffs' formulation of those preliminary issues as set out in the chambers summons.  These actions have proceeded a long way and the pleadings have been the subject of much argument and some judicial decision.  They have been refined in that way.  I consider the preliminary issues must be defined by reference to the pleadings.

8. Subject to any submissions from the parties, I consider that the preliminary issues in CIV 1570 of 1989 should those issues as pleaded in par 1 to par 17, par 19 to par 24, par 26, par 27, par 29, par 30, par 33 to par 38 and the prayers for relief which relate to those paragraphs, and to par 1 to par 10, par 12, par 13, par 15, par 16 and par 17 of the first defendant's defence.  The issues also include the second defendant's defence par 1 to par 7 and par 9.  To give effect to orders in this form I consider I should revoke order number 4 made by Master Sanderson on 5 May 1997 as my order supersedes it.  Part of that order will remain in effect.  I will order that the third defendant will not be involved in the trial of preliminary issues.

9. In action CIV 1804 of 1989, subject to the submissions of the parties, I propose that the preliminary issues be those as defined in par 1 to par 16, par 17.2 to par 20, par 22, par 24, par 25, par 26 and par 28 of the statement of claim, and the prayers for relief which go with those paragraphs, and to par 1 to par 11, and par 13 to par 15 of the defence.

10. Subject to any contrary submission of counsel, costs of this application should be in the causes of the two actions.